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The federal cabinet expects to make a decision on the $36-billion Pacific NorthWest LNG project, slated for Lelu Island at the mouth of the Skeena River, by late June.

cific Northwest LNG

Canada's Environment Minister wants to see significant action by the British Columbia government to combat climate change as Ottawa mulls approval of a giant project to export liquefied natural gas from the province's northern coast.

The federal cabinet expects to make a decision on the $36-billion Pacific NorthWest LNG project by late June. Backed by Malaysian giant Petronas, the LNG export terminal promises $2.5-billion in annual government tax revenue, but will generate some 5.7 million tonnes of carbon dioxide a year – enough to boost the province's total emissions of greenhouse gases by 8.5 per cent.

That makes it the most serious test so far of the federal Liberal government's willingness to balance its ambitious climate-change agenda with a desire to rejuvenate a moribund economy.

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On Monday, Environment Minister Catherine McKenna said she wants to know what the B.C. plan is to fight carbon emissions.

"We're certainly looking forward to see … what actions they are going to do to meet their own targets while still projecting LNG," Ms. McKenna said in an interview from Tokyo, where she is attending a meeting of Group of Seven environment ministers.

The B.C. government has promised to table a new strategy in June, after a report last fall concluded its "world-leading" climate action plan is veering off the rails – even without the establishment of a new LNG industry.

It launched an ambitious climate action plan in 2008, introducing North America's first carbon tax, along with hard caps on industrial emissions, with the legislated goal of reducing emissions by 33 per cent below 2007 levels by the end of 2020. The interim goals for reductions by 2012 were met.

However, the carbon tax has been frozen since 2012, the hard emission caps have been watered down and the province's emissions have started to climb again. Meanwhile, Alberta and Ontario have recently unveiled aggressive new targets to reduce GHG emissions, seeking to leapfrog ahead of British Columbia.

Alberta will have an economy-wide carbon tax starting in 2017, and there will be a cap on emissions from the oil sands. Ontario's cabinet last week reviewed a plan to spend $7-billion over the next four years in a bid to reduce emissions, with a major focus on phasing out natural gas for heating and incentives to get more electric cars on the roads.

Ms. McKenna is not the only one who is anxious to see British Columbia's new climate plan: On Monday, seven members of the B.C. climate leadership team wrote to Premier Christy Clark to decry delays in the creation of a new action plan by the province.

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"B.C. is in no position to delay or scale back its efforts," the letter states. "The rest of Canada and the rest of the world have been taking action since B.C.'s initial climate plan in 2008, and B.C.'s increasing carbon pollution is taking us in the wrong direction."

The 19-member team was appointed by Ms. Clark one year ago to provide advice on how to update the province's climate action plan to adjust for growth in the economy and, in particular, the potential creation of an LNG industry. The seven members who signed the letter include First Nations leaders, academics and environmentalists.

Merran Smith, executive director of Clean Energy Canada, is one of the authors. She said the proposed blueprint can accommodate the development of LNG, but only if the plan is accepted in its entirety. "Anything less than that is not climate leadership."

B.C. Environment Minister Mary Polak acknowledged that Ottawa needs assurances that her province's LNG agenda will not threaten the federal commitment to taking action on climate change.

"We know they have big concerns around GHG emissions, both from the LNG plant itself and upstream," she said in an interview. "We know that is something the federal government is looking at as they consider whether or not they approve PNW: What action is B.C. proposing with respect to GHG emissions, generally and specifically to the oil and gas industry?"

Ms. Polak indicated that British Columbia's updated climate action plan will include measures to reduce upstream natural gas emissions, particularly targeting methane leakage.

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The B.C. Liberals won the last provincial election promising to secure a new LNG industry that would generate enough revenue to retire the provincial debt. With the next election one year away, it has not landed a single final investment decision, and Ms. Clark's government is anxious for Ottawa's approval of this project.

The province believes the emissions from the proposed Pacific NorthWest LNG project could be reduced by a third through changes to reduce the emissions from the upstream production of natural gas. It is also making the case in Ottawa that the federal government should consider the global benefits of B.C. selling LNG to offset coal-fired power in China.

Asked if the new B.C. climate plan could influence the federal decision on the LNG project, Ms. McKenna said: "Everyone recognizes we need to take action on climate change. At the same time, we need to develop resources in a responsible and sustainable way. … And I am looking forward to understanding what actions, what significant actions, B.C. is going to take on climate change."

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