Monday, October 6, 2014

Petronas puts Federal and Provincial governments on the clock on Lelu Island project

It's shaping up to be a whirlwind of information delivery today when it comes to a proposed major industrial project for the North Coast.

As Monday morning progressed there seemed to be an avalanche of information starting to flow regarding Petronas, the parent company for the Pacific Northwest LNG project.

The days developments started with more background on the state of the current environmental process for the proposed terminal development, a helpful guideline as to what steps the company is taking towards its environmental assessment issues.

However, that information was followed by a bit of a seismic shock delivered by a press release that observes the many concerns from the company on the LNG file need to be addressed by the end of October, or the entire window of development may be gone for the next ten to fifteen years.

First a look at the environmental review items:

In early September, Pacific NorthWest LNG applied to federal and provincial regulators, seeking an extension to their Environmental Assessment process for their Lelu Island LNG terminal proposal.

Details of a September 4th letter from the head of Enviornmental and Regulatory Affairs at Pacific NorthWest LNG have been posted to the BC Envrionmental Assessment Office website, explaining the request for that extension and what they hope to address from it.

Included in that letter, is a look at the engagement to come and observations as to the redesign for some of their Terminal components. Included in that overview, details on the shift in plans that would see no dredging at the berth areas, which Pacific NorthWest suggests would prevent significant adverse environmental effects to Flora Bank, shifting the focus of the deep water berths to Chatham Sound.

They also outlined the changing nature of their intentions when it comes to the location of worker accommodations, moving all or in part from a facility on Lelu Island to a new location on private land in the District of Port Edward.

They will also review the assessment of the impacts of the camps to socio-economic and human health.

In addition to those changes to their Terminal planning, Pacific Northwest is also going to provide an updated Aboriginal Consultation Report, a copy which they had planned to deliver to the Environmental Assessment Office before mid September.

A lot of developments have taken place since that initial request in early September, most notable was the concern raised by the Petronas chairman Shamsul Abbas, who relayed his concerns regarding delays in taxation plans, the lengthy nature of the approval process for the project, as well as the desire for more incentives for the large scale development.

The main talking point following that interview was the prospect of outright cancellation of the project outlined as possible unless the provincial and federal government picks up the pace.

To highlight those concerns on the bureaucratic issues that the company is looking to address, Petronas further outlined their position on LNG development in British Columbia with a media release issued today.

With the key discussion point being segments of the final two paragraphs of the release, which outline the urgency that Petronas is attaching to the current discussions:

 "In order to remain competitive, PETRONAS needs to secure consensus on key principles vital to the success of this project by the end of October.  Missing this date will have the impact of having to defer our investments until the next LNG marketing window, anticipated in 10 to 15 years.  

In light of this, the next few weeks will be critical in ensuring that commitments made during the last meeting will be followed through by creating a tangible environment which stimulates competitiveness and investor's confidence in British Columbia. PETRONAS and its partners look forward to working with the British Columbian and Canadian government to advance with pace, clarity and purpose into turning the vision of a Canadian LNG industry into a reality"

Should the two levels of government and Petronas not find common ground by the end of the month, the prospect of the Lelu Island project becoming a reality would seem to be unlikely.

The Petronas  media release of today highlights that possibility and suggests the solution to the issue is a more fast paced level of engagement by both levels of government.

Local residents can learn more about the road ahead for the project this week with a pair of Open Houses hosted by Pacific NorthWest LNG.

They are holding the first in Port Edward on Tuesday, from 4:00 to 7:00 PM at their offices in the old Port Edward School.

Wednesday, they shift their presentation to Prince Rupert, hosting that Open House at their offices in the Capital Mall on Third Avenue West. The Prince Rupert session will run from 2 until 6 PM.

Considering the news of the last 24 hours, there should be lots to talk about.

You can review all of our items on the Pacific Northwest Lelu Island project from our archive page.

As word of the statement from Petronas began to circulate, many of the major media groups provided their review of developments, we'll update those files below, through the day:

Globe and Mail-- Petronas CEO warns of 15-year delay to B.C. LNG project
National Post-- Petronas threatens 15 year delay on LNG project if B. C. tax deal not reached
Vancouver Sun-- Petronas warns of possible delay of 11 billion B.C. LNG project
Vancouver Sun-- Petronas steals agenda with shot across LNG bow
Victoria Times-Colonist-- Petronas warns of long delay in B. C. LNG project
Victoria News-- Petronas gives deadline for LNG deal
Vancouver Province-- Petronas says ‘consensus’ on B.C. LNG terms in next few weeks is ‘critical’
24 Hours Vancouver-- B. C. an easy mark for LNG giants
CKNW-- Petronas warns B. C. of LNG investment delays if deadline not met
CBC-- Petronas LNG: CEO threatens 15 year delay to B. C. project
Bloomberg Business Week-- British Columbia LNG Project at Risk of 15-Year Delay
Business in Vancouver-- Act now on LNG, or Petronas could delay investment by up to 15 years, threatens CEO

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