Alberta and B.C. in talks to expand Canadian LNG reach globally, Danielle Smith says

VANCOUVER – Alberta Premier Danielle Smith said her province has begun talks with British Columbia as part of a push to greatly expand the reach of Canadian natural gas to more foreign markets.

Speaking on the final day of the international LNG 2023 conference in Vancouver, Smith said delegates told her that many countries in Asia cannot meet emission reduction goals without natural gas, and the goal should be for Canada to fill — and benefit from — that gap.

She expressed frustration about the lack of federal infrastructure that would allow Alberta producers to fulfil global market needs.

“With the right infrastructure in place, Western Canada would become a sought after supplier for both Asia and Europe,” Smith told conference attendees.

“Shipping LNG from Canada’s West Coast to Asia takes 11 days, compared to 20 days from the U.S. Gulf Coast.”

“With the completion of proposed projects in Atlantic Canada, shipping Western Canada’s gas to Europe would take seven to eight days, and that would be less than any other North American LNG project.”

In an attempt to spur more LNG export projects on the West Coast, Smith said she and B.C. Premier David Eby began a discussion two weeks ago to explore leveraging Article 6 of the United Nations Paris Accord, which allows Canada to gain carbon credits for reducing emissions abroad.

Smith said she wants to see Alberta and B.C. “pioneer” a way to use Article 6 to create more interest in export infrastructure that would supply Asia with LNG, while Canadian jurisdictions gain the credits that are generated from displacing more polluting fuels such as coal in those markets.

“I feel like this is an integral part of a global strategy for emissions reduction, and I think that Alberta has an obligation as the owner of the resource in our province to take a lead making sure we build that consensus,” Smith said.

The massive LNG Canada project in Kitimat, B.C., a $40-billion-dollar project that is about 85 per cent complete, is the only such export facility under construction in Canada and is scheduled to begin delivery mid-decade.

Speaking earlier this week, Eby confirmed he was speaking with other premiers about the LNG opportunity and the awareness that there is a global demand for Canadian natural gas internationally.

However, Eby said he is “not at all confident” that B.C. is on track to provide the necessary electricity to move the natural gas industry locally away from fossil-fuel usage, something that companies such as Malaysian energy giant Petronas mentioned as a key part of the Canadian LNG brand.

“It takes eight to nine years to fulfil a request from industry for the kind of electricity that they’re looking for,” Eby said. “It takes about the same time to go through the call for power all the way through to generation and transmission.”

“We have to speed that up.”

Eby said a task force had been set up to do exactly that, to ensure B.C. does not miss LNG’s economic opportunity.

Smith said Alberta is not stopping at talking to B.C., identifying the Yukon-Alaska corridor through Skagway, a Saskatchewan-Manitoba corridor to Churchill and possible links to James Bay in Ontario as ideas to explore.

“I’m looking at all of those options,” she said. “I think out best option, since we already see so many LNG projects underway with partnership of Indigenous communities, is making sure we can tie in our gas into those project lines.”

This report by The Canadian Press was first published July 13, 2023.