Mark Milke is a Calgary columnist and author of a 2001 book on the 1990s-era British Columbia government
One reason why the government of British Columbia is so vocal in its unconstitutional opposition to federally approved oil pipelines (see: approved Kinder Morgan expansion) is because the NDP is tied at the political hip to the Green Party in the legislature. That is the one where a razor-thin majority for the two parties exists with the Greens at three seats, the NDP at 41, with the opposition Liberals at 42 seats and one for an independent.
The Greens oppose not only oil but also further natural-gas development and exports of the same, a position opposite that of the NDP government. Thus, in political calculations, B.C. Premier John Horgan more fiercely opposes oil to satisfy the Greens – that, and much of Mr. Horgan's own fervent anti-oil base and caucus.
That's politics, and it is driving investment away from British Columbia. Nonetheless, the B.C. government's political calculation does contain the seed of possibility that natural-gas exports could flourish sooner than previously thought, and provide a boom in employment and tax revenue to British Columbians.
That natural-gas bet is more solid with the recent forecast by Royal Dutch Shell that the market for liquefied natural gas (LNG) will soon tighten. The company, which has still not announced if it will proceed with an LNG export facility in British Columbia, pointed out that the market for LNG grew 30 per cent in 2017, more than expected. Royal Dutch Shell forecast that the market for LNG could switch from oversupplied now to a deficit by the mid-2020s.
Shell is not the only entity predicting a potential supply shortage in natural gas. The International Energy Agency's 2017 report on natural gas predicted consumption growth of 10 per cent by 2022 when compared with 2016. The IEA noted developing economies, with China in the lead, will account for 90 per cent of the increased demand for natural gas.
China, of course, is across the ocean from British Columbia. The Middle Kingdom, along with the rest of Asia, has long been importing LNG. The problem for Canada is that Australia, and as of late the United States, were both swift in responding to market opportunities for gas exports. Investment in Australian LNG amounted to nearly $200-billion in the past few decades. In the United States, five new LNG plants will be operational by 2019, including those exporting LNG to Asia.
Both countries got the jump on Canada and in part because of domestic opposition that proved to be self-fulfilling, not prescient. For example, BC Green Party Leader Andrew Weaver has slammed potential natural-gas exports as a fantasy, as akin to believing in "unicorns." Last June, he reminded a reporter that he predicted in 2013 that "LNG isn't going to happen" and "cannot happen, because there's no market for it." Of course, the reason B.C. was unable to develop an export industry in LNG had much to do with a fervent minority of British Columbians such as Mr. Weaver who reflexively oppose oil and gas development and exports.
That position is in stark contrast to the reality of a B.C. government that desperately needs to prove to the majority of voters that it does not share Mr. Weaver's unreality on how new employment will be created. The NDP government thus must pay some attention to investment intentions around the world, and to employment and incomes on the North Coast, including that of First Nations who want LNG export plants built. Of course, the government must also consider its own future revenue streams.
B.C. may soon have a chance to profit off the world's growing natural-gas market instead of missing out again. Beyond the medium-term increase in natural-gas consumption to 2022, pointed to by the International Energy Agency, the IEA also forecasts that, by 2040, demand will grow by 45 per cent over 2016 levels. By then, natural-gas consumption will be second only to oil as the fuel of choice. In addition, 80 per cent of the projected growth will be led by developing economies.
If the British Columbia government can manoeuvre their way past Mr. Weaver's continued negativity, there is another chance for British Columbia to profit from natural-gas exports.
British Columbia’s Premier says he won’t respond to provocations from Alberta in an escalating trade spat. A day after Alberta banned B.C. wine imports, John Horgan said having “duelling premiers” is in no one’s interest.
The Canadian Press