Former Canadian minister Jim Prentice has spoken out of the need for the Canadian gas industry to accelerate the development of liquefied natural gas (LNG) plants in order to offset competition from America and Australia, in the battle to supply LNG to Asian markets. Exportation of LNG has been put on hold due to regulatory and structural and pricing issues.
Prentice, now the executive vice-president and vice-chairman of CIBC, said: "There is a window of opportunity, and it is closing. If Canada is ultimately to win in liquefied natural gas, we need to pull together and seize that opportunity before it passes us by.”
The coast of British Columbia could be home to a potential five LNG hubs, which are due to be in place by 2020.
“Window of opportunity”
"Given the scope of the opportunity before us and given the speed with which other countries around the world are rushing to get into the game and fill LNG demand, we in Canada need to push ahead with a much greater sense of urgency," Prentice outlined."There is a window of opportunity, and it is closing. If Canada is ultimately to win in liquefied natural gas, we need to pull together and seize that opportunity before it passes us by."
However, together with the cost of implementing an LNG terminal, which costs billions of dollars, regulatory and structural complications have caused major delays in construction.
Prentice identified crucial steps that must be taken. He urged the industry establish a royalty regime and that skilled workers were available to work to tight deadlines. He also acknowledged that the government, First Nations and the region of B.C itself institute a joint management system that takes into account environmental concerns whilst concurrently seeking to reap maximum benefit from LNG development. Finally, Prentice stressed that a decision must be made as to how the terminals would be powered.
Prentice said that the cost of LNG is preventing deals from being struck with potential consumers in Asia. The US, Prentice stressed, is keen to export LNG to Asian markets, which would subordinate Canada’s effort to do that same. "The Americans”, he said, “are eager to get into LNG in a big and aggressive way. That could have real implications for our ability to do the same.
"If we're hesitant, if we continue to move slowly, we could wake up to discover that our competitive opportunity has vanished. For Canada, nothing is more urgent right now than getting in the game."
However, Japan sees Canada very much as a strong potential supplier. Shinji Fujino of Japan Oil, Gas and Metals National Corp. (JOGMEC), labeled Canada as “one of the most promising” supply regions for Japan, who, since the nuclear disaster at the Fukushima Daiichi plant, following the 2011 tsunami and earthquake, have been looking for alternative sources of energy. Fujino identified B.C.’s geographical proximity to Asia and transparent regulatory framework.
Edited from various sources by Ted Monroe
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