Feds Declare LNGC2 "National Interest" Project; Ksi Lisims LNG Approval Missing in Action

Highlights

• Carney listed LNG Canada Phase 2 as one of five projects to be "fast-tracked" by the new Major Projects Office (despite LNGC2 being effectively fully permitted already)
• Ksi Lisims LNG approval was legally due September 7th. No announcement has come and it's conspicuously absent from the new "national interest" announcement (update: approval published on Sept 15th)
• PRGT eastern amendment approved despite "lack of consensus" with First Nations
• Flows through CGL to LNG Canada remain volatile and low, suggesting continued difficulties

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Details

LNGC Phase 2 Identified as "National Interest" Project

The Carney administration listed LNGC Phase 2 as one of five "national interest" projects that the federal government will use its newly legislated authority to fast-track through regulatory processes. The only problem, as a number of commentators have pointed out, is that the project is already fully approved: it was included as part of the original LNGC and CGL environmental assessment certificate applications from 2014.* It will need some BC Energy Regulator permits before construction begins, but those are low-barrier, essentially rubber stamps. All five projects that Carney announced are more or less fully approved, which leaves the rationale for this (and the whole Major Projects Office) unclear.

One plausible explanation is that the entire stunt is PR, part of Carney's effort to make himself appear as though he is fulfilling promises and "getting things done" after what he characterizes as the ineffective Trudeau regime. That is undoubtedly part of it, but reporting suggests that the MPO may be intended to play an additional, less publicized role: acting as central office for coordinating public finance and subsidies. Bloomberg also reports that the federal government is directly engaging in negotiations with the consortium behind LNG Canada in an effort to push them to a final investment decision, which is a new development.

As part of this flurry of announcements, Carney announced plans for a "Northwest Critical Conservation Corridor" managed by the Major Projects Office that would involve a land mass "the size of Greece." Details remain scarce at this time but this is a development to watch.

*: The "$40-billion" investment number that is regularly repeated in the media and by politicians refers to estimates made for "full buildout" of the project, meaning both phases. Outlets like CBC continue to misleadingly report this number as though it represents the amount already invested in the project, or even more inaccurately, the amount invested specifically in BC.

Ksi Lisims LNG Approval Missing in Action

The EAO submitted its assessment of the Ksi Lisims LNG project to the ministers responsible for making the decision on August 7th. The ministers are required by statute to make the decision within 30 days, which has now passed. No decision has been posted, no decision has been announced, and Ksi Lisims was notably absent from the federal government's Major Projects Office list.

What seems most likely is that the approval decision was made behind closed doors and will be announced when it is convenient. There doesn't seem to be a statutory requirement about posting the decision publicly. That said, the length of time that's passed — and the absence of the project from the federal list — is certainly enough to raise eyebrows.

PRGT Eastern Amendment Approved

PRGT submitted a request to modify the first 223km of pipeline route in northeast BC in October last year. The approval is unsurprising and there is not a lot to report here, but it is worth highlighting that many First Nations consulted — including the Saulteau First Nation which supported the amendment specifically — expressed varying degrees of opposition to the pipeline more broadly and its effects on treaty rights and the environment. Saulteau, Nak'azdli Whut'en, West Moberly, and Blueberry River all expressed serious concerns about the project, with some of them explicitly rejecting the amendment. As the province euphemistically put it, "consensus" was not reached despite "the efforts made towards seeking consensus."

CGL Flows

During the summer, there was some reporting about startup difficulties at LNG Canada, but since then, most media coverage has assumed that LNG Canada startup is going just fine. The Coastal GasLink inflows, calculated based on Enbridge data, suggest otherwise.