Natural gas has been given the green stamp of approval by the government of British Columbia.
Following up on promises made by Premier Christy Clark in June that B.C.’s Clean Energy Act would be updated to address the use of natural gas for power generation, Minister of Energy and Mines Rich Coleman announced on July 24 that the legislation will now allow the use of that provincially abundant resource to power liquefied natural gas (LNG) export facilities.
That possibility has been a hot topic of conversation since February, when Clark told Pipeline News North that all the power generated by BC Hydro’s controversial Site C hydroelectric project could be used by the first phase of LNG Canada, a joint venture between Shell Canada, Korea Gas Corporation (KOGAS), Mitsubishi Corporation and PetroChina Company to move northeast B.C. natural gas to the west coast for export as LNG.
Coleman followed up on those remarks during the Fort St. John Energy Expo in May by suggesting that natural gas could be used to power LNG facilities.
That is now official.
“It’s an important signal to the Canadian industry and the international investment community that B.C. is serious about finding a way to get its resources to market,” said Geoff Morrision, BC operations manager with the Canadian Association of Petroleum Producers (CAPP).
“It’s very positive,” he added. “There was some question about how the industry could find sufficient energy supply for all the projects being proposed. And so this brings some clarity and some certainty around those questions.”
A statement from the government following the announcement indicated that natural gas would be part of the energy mix available to LNG projects, which would also include renewable energy sources such as wind and hydro.
The 93 per cent clean energy target remains intact for all power generation, not specifically for LNG export facilities.
The concern has been that burning natural gas to produce electricity would compromise greenhouse gas emissions targets set by the provincial government, but they appear confident that emissions standards for natural gas power generation plants will be strict enough that the impact will be minimal.
“The regulation as it’s set is very specific around promoting the export of natural gas,” said Morrison. “Does it initiate a wider conversation about the role of natural gas in electricity generation in BC? Perhaps.
“You need to think about the emissions targets in a global context,” he continued. “And so if you can help achieve a reduction globally, the trade off in B.C. is worthwhile.”
Although the decision has been made with LNG exports in mind, broadening domestic markets for B.C. natural gas is also welcome news to Canadian producers, according to Morrison.
“CAPP supports expanding those domestic markets as well,” he said. “So, whether it’s for vehicles or for electricity development, CAPP thinks natural gas plays an important part [and] should be part of the energy mix.
“CAPP believes that natural gas is a clean source of electricity,” he concluded, “and it can be part of that green mix in the BC context.”