The Nisga’a Nation and Western LNG are buying TC Energy Corp.’s TRP-T plans for a pipeline across British Columbia in an effort to bolster a proposal for exporting liquefied natural gas.
After the deal closes by the end of June, the new owners will be taking over TC Energy’s Prince Rupert Gas Transmission (PRGT) pipeline plans in an effort to supply natural gas to the Ksi Lisims LNG project on the West Coast.
The PRGT route was originally intended to stretch nearly 900 kilometres from northeast B.C. to Lelu Island near Prince Rupert, and transport natural gas to Pacific NorthWest LNG. But Malaysia’s state-owned Petronas cancelled the Pacific NorthWest joint venture in 2017.
Revisions need to be made to shorten the pipeline route so that natural gas would be transported from northeast B.C. to the Ksi Lisims site at Wil Milit on Pearse Island.
Eva Clayton, the elected president of the Nisga’a Lisims government, said the purchase of PRGT marks a historic time for the Nisga’a, which will co-own PRGT with Western, an LNG developer based in Houston.
“In taking an equal ownership role in this pipeline, we are signalling a new era for Indigenous participation in the Canadian economy,” Ms. Clayton said in a statement on Thursday. “First Nations are no longer being left behind as generational wealth is built from the resources of our lands. At long last, hope and optimism are returning to Indigenous communities across northern B.C.”
François Poirier, TC Energy’s chief executive officer, said he is pleased with the transaction.
“This is an important agreement that will see Indigenous co-ownership and development of an integrated LNG project,” he said in a statement.
While TC Energy has spent more than a decade on preparing PRGT, the Calgary-based company said “initial proceeds from the transaction are not expected to be material” and there could be extra payments to TC Energy in the future, assuming the pipeline gets built.
Western CEO Davis Thames also welcomed the announcement. “PRGT is fully engineered, permitted and ready to construct. Our collaboration with TC Energy has given us the benefit of their team’s experience and insight,” he said in news release. “Under our new partnership and leadership model, we will build on those learnings and on their work done to date.”
The Nisga’a, Western and a group of natural gas producers called Rockies LNG are partners in the Ksi Lisims project.
Ksi Lisims is undergoing a regulatory review to obtain environmental approval. The project has said it will comply with what the B.C. government calls credible plans to reach net-zero emissions of greenhouse gases, as outlined in the province’s Energy Action Framework announced last year.
But Gitanyow hereditary chiefs in northwest B.C. have expressed climate concerns about both Ksi Lisims and PRGT. The Gitanyow chiefs issued a news release only three hours before the joint announcement from the Nisga’a, Western LNG and TC Energy. The Gitanyow leaders say their calls for the B.C. government to pause the environmental assessment of Ksi Lisims have been rejected.
The Wilderness Committee, David Suzuki Foundation, Dogwood, Stand.earth, Sierra Club and Northwest Institute are among the climate and environmental groups warning about fossil fuels such as LNG, saying there are substantial deficiencies in Ksi Lisims’s application to the province’s Environmental Assessment Office.
Ksi Lisims plans to use two floating facilities to produce LNG, with hydroelectricity powering motors for compressors in the liquefaction process. The project would then deploy other vessels to export LNG to Asia, starting by 2029.
The contentious Coastal GasLink pipeline project, to be operated by TC Energy, will be supplying the Shell PLC-led LNG Canada joint venture in Kitimat, B.C., where exports of natural gas in liquid form to Asia are slated to begin by mid-2025.
LNG Canada is the first LNG export project to be under construction in the country. If Ksi Lisims gets built, it would be Canada’s second-largest LNG export facility, after the Shell-led terminal.
Ksi Lisims is among only a handful of remaining LNG prospects in B.C. Others include Cedar LNG in Kitimat; Woodfibre LNG near Squamish; and FortisBC’s expansion plans at its domestic Tilbury LNG site in Delta.
Cedar, which is co-owned by the Haisla Nation and Pembina Pipeline Corp., awarded a contract in January for engineering, procurement and construction of a floating production unit to Samsung Heavy Industries and Black & Veatch, subject to Cedar making a final investment decision by mid-2024.
Earlier this year, Ksi Lisims signed Shell Eastern Trading Pte Ltd. as its first purchaser of LNG.
An analysis released last week by the Institute for Energy Economics and Financial Analysis, a U.S.-based research group, said Canadian LNG proposals face continuing uncertainty.
In January, U.S. President Joe Biden decided to pause new export permits south of the border for LNG. Seven U.S. LNG export terminals are already operating, and another five facilities are likely to open by 2028.
Brent Jang