Marketing LNG as a climate saviour at Madrid summit isn’t going to work

Good news for Canada! It is no longer in the running for the Fossil of the Day Award, which is bestowed by environmental activists on countries going out of their way to ensure the planet achieves burnt toast status. This week, at the Madrid climate summit, Australia and the United States have emerged as the big winners.

The bad news? The Canadian oil and gas industry will probably leave the United Nations climate conference with no prize of its own. It had hoped that exports of liquefied natural gas (LNG) would play a role in reducing global greenhouse-gas emissions. Gas burns more cleanly than coal and the industry wanted Canada to earn emission credits by, say, exporting the fuel to China, where it might displace coal in power plants.

The idea seems to be going nowhere. Even Jonathan Wilkinson, the Environment Minister who made his international debut on Tuesday in Madrid, has played down the chances of LNG exports fitting into Canada’s emissions-reduction effort. “I think we have to be very careful about the LNG argument,” he told The Globe and Mail ahead of his arrival at the summit known as COP25.

The main purpose of COP25 is to reach a deal on Article 6 of the Paris Agreement, struck in 2015, which saw almost 200 countries set out fairly ambitious carbon-reduction targets to try to stop average global temperatures from rising more than 1.5 C over preindustrial levels. Article 6 would establish a global emissions trading system, and transparent and fair rules to govern it.

Countries with low emissions could sell their allowances to those with high emissions. Putting a price on carbon would encourage high-emission countries to clean up their act. The supply and demand of allowances would create a global carbon price and marketplace. And a high-emission country could earn allowances by, say, financing a tree-planting project in Africa.

Which brings us to Canada – specifically British Columbia and its $18-billion-plus LNG plant in Kitimat. The project, known as LNG Canada, is owned by a consortium of energy companies including Shell and PetroChina.

The consortium has a fantasy. Since natural gas burns at roughly half the carbon intensity of coal, it sees the product as a tool to lower the planet’s overall carbon emissions, assuming the Chinese and the Indians and other coal-mad countries get on board. Were China to substitute gas for coal in 20 to 40 of its plants, the country’s emissions would drop as much as 90 million tonnes, the equivalent to the emissions of 80 per cent of all the cars in Canada, LNG Canada claims. Voila! Canada would go from part of the problem to part of the solution, building a world-class export industry along the way.

In an interview in Madrid, Tim McMillan, chief executive officer of the Canadian Association of Petroleum Producers (CAPP), the industry’s lobby group, said that “without enabling our resources sector, largely gas, Canada has no chance of meeting its 2030 and 2050 [carbon reduction] commitments” (Justin Trudeau’s Liberals have pledged to go to “net zero” emissions by 2050).

What’s not to like? A lot, as it turns out.

First off, LNG is hardly clean. While it may be true that gas has a lower carbon intensity than coal, you have to consider the whole production process. Most of the gas that will be fed to the Kitimat site will come from a deep drilling technique known as fracking, which is energy-intensive and prone to leaks of methane, a monstrously powerful greenhouse gas. The gas has to be collected, transported to Kitimat, liquefied and sent by ship to Asia, so the entire process will still be highly energy-intensive.

So, selling LNG as a climate saviour to Article 6’s negotiators isn’t going to work. In Madrid, Elizabeth May, the former leader of the Green Party of Canada, told The Globe: “It’s never going to happen here. … Fracked gas can have the same carbon footprint as coal.”

The other problem is that Article 6 isn’t specifically about fuels or technology – “LNG” doesn’t appear in the draft and won’t appear in the final massaged text, once all the brackets are removed. The core function of the article is to set up a credible emissions trading system, not play favourites.

Still another problem is verification. How would LNG Canada know that any gas sold to China would be used to displace a coal burner? A gas burner might simply be an addition to China’s fleet of generating plants. When he was the NDP environment critic in British Columbia in 2016, George Heyman said, “There is absolutely no evidence [that] B.C. LNG will result in less coal use in China.”

Today, Mr. Heyman, who is at COP25, is the province’s Minister of Environment and Climate Change and has changed his tune. He insists that CleanBC – the plan to lower emissions by 2030 to 40-per-cent below 2007 levels – can be accomplished, even with LNG Canada pumping out millions of tonnes of greenhouse gases a year.

Perhaps, but the negotiators at COP25 won’t buy it. Mr. Wilkinson seems to understand that. Soon, the oil and gas industry and B.C. will have to admit defeat on this file.

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