Richelle Cooper, 22, grew up on a ranch near Dawson Creek, but she sees the energy industry as the economic catalyst for the region.
A decade ago, there weren’t nearly as many job opportunities for youth as there are today, and it was common for local high-school graduates to leave in droves to Vancouver, Edmonton, Calgary and other cities, she said after finishing a 12-hour shift as an administrator and labourer for Infinity Oilfield Services.
“Natural gas development is creating jobs, and people are realizing that now,” she says.
After completing the nursing program at Northern Lights College in Dawson Creek, Ms. Cooper could only find part-time work as a nurse, so she jumped at the chance when a full-time opening arose at Infinity in late 2012. She already makes $22.50 an hour, but with some more training and experience, she is optimistic about landing a field job that pays $35 an hour and developing a fulfilling career.
A bounty of gas
China, Japan, South Korea and Malaysia are among the Asian energy buyers that are eyeing northeastern B.C. gas, notably the Montney formation. The Liard, Horn River and Cordova plays also boast significant gas reserves.
The Montney is much larger than the Marcellus gas formation in the U.S. Northeast, notes TD Securities Inc. analyst Mike Dembicki. He estimates Montney to be the third-largest hydrocarbon resource in North America, trailing only Alberta’s oil sands and the Permian oil and gas basin in Texas and New Mexico.
Shell leads the LNG Canada project, which is proposing to build an export terminal at Kitimat, one of the leading contenders in the race to export LNG from northwestern British Columbia.
Another major player is Malaysia’s state-owned Petronas, which leads the Pacific NorthWest LNG proposal to build an export terminal at Prince Rupert. In 2012, Petronas acquired Progress Energy Canada Corp., whose key assets are natural gas properties in northeastern British Columbia.
“Our natural gas markets are being eroded in the U.S. and Eastern Canada. We’re going to have to find new markets in Asia,” says Progress chief executive officer Michael Culbert.
Enormous capital investments are required to bring LNG projects on stream. “This isn’t what junior Canadian companies do. This is what multinational companies do because the capital is so intense,” Mr. Culbert says. “We’re identifying and validating the reserves that will serve 20-year to 30-year LNG contracts.”
Progress recently had 27 rigs in northeastern British Columbia, making it the most active company in the region. Pacific NorthWest LNG estimates that almost $36-billion will need to be spent in order to make its export plan a reality by early 2019. It’s aiming to make its final investment decision by the end of 2014, while Shell-led LNG Canada is targeting a “mid-decade” deadline for its decision.
Most of the 567 wells drilled by all companies across British Columbia last year were for natural gas. B.C. drilling activity last year increased 24 per cent from 2012. Experts forecast an even busier 2014. Until it can export gas, however, B.C. is adding to a domestic market already well supplied.
The provincial payoff
B.C. Premier Christy Clark believes that if five LNG projects come to fruition, the economic benefits will include 39,000 construction jobs and a further 75,000 jobs created for operating LNG plants and pipelines. The B.C. government envisages a total of $1-trillion being added over three decades to the province’s gross domestic product.
Ms. Clark has a long-term vision modelled after the $16.7-billion Alberta Heritage Savings Trust Fund. She wants to create the British Columbia Prosperity Fund, which would become an enormous piggy bank to collect LNG tax revenue. An LNG tax regime is slated to be unveiled in the province’s budget on Feb. 18.
The Premier’s optimism helped the B.C. Liberal Party score a surprising re-election victory last May. But critics deride her LNG vision as a pipe dream, questioning whether even one project will get off the ground and saying it is unrealistic that she has set a goal to dramatically slash the province’s $62-billion debt with proceeds from LNG tax revenue.Report Typo/Error