|October 07, 2013|
Petronas's potential B.C. investment pegged at $36 billion
|Malaysia's state energy company, Petronas, is pressing ahead with plans to invest $36 billion in B.C.'s natural gas sector.|
Malaysian Prime Minister Najib Razak lauded the "gargantuan" investment Sunday as Canadian Prime Minister Stephen Harper arrived for a summit of Asian leaders.
"I am told this is the largest direct investment in Canada by any country," Najib said at a brief news conference in the opulent prime minister's office in Putrajaya, near Kuala Lumpur, before he and Harper left Malaysia separately to attend the annual APEC summit of Pacific Rim leaders.
"This is a very significant landmark decision by Petronas," Najib said. "It is done in the wake of the friendly relations we have and the positive response we received from the Canadian government in respect to Petronas' involvement in Canada ... We have a very high level of confidence that this investment will be supported by the Canadian government today and in the future."
Petronas plans to build both a liquefied natural gas plant ($9 to $11 billion) in northwest B.C. near Prince Rupert and fund TransCanada's building of a pipeline ($5 billion).
The pipeline would transport gas from northeastern B.C. for export overseas to Asian markets.
Last year, Petronas invested $6 billion to purchase Calgary-based Progress Energy.
There are also major upstream investments in gas wells and other facilities, said Greg Kist, president of Pacific Northwest LNG, the Petronas-owned company that will operate the LNG terminal.
"When you put all of those pieces together and look at that over the six years to the end of 2018, that investment would be in the range of $36 billion," Kist said Sunday evening from Alberta.
"This is our continued move forward on our LNG project," he said, referring to the Malaysian prime minister's statement.
A final investment decision on whether to move ahead with the terminal and pipeline project will be made at the end of 2014, Kist said.
Harper did not refer directly to Najib's remarks about the Petronas investment --- or to the huge dollar figure that his Malaysian counterpart attached to it --- before making the three-hour flight to Bali on an RCAF aircraft. But he said, "We view the Petronas investment very positively. All the indications are that Petronas is looking at further investments and Canada is very excited about this possibility."
Such investments will each be judged on their own merits and whether they serve Canadian interests, he added. "Obviously our policy involves the use of discretion when it comes to state-owned enterprise," Harper said.
B.C. Premier Christy Clark has made the development of a B.C. liquefied natural gas industry a key economic initiative, promising tens of thousands of new jobs.
"The Malaysians are making a huge commitment to British Columbia," Clark said Sunday during the Run for the Cure.
There are at least five proposed LNG projects in northwest B.C.
First Nations have not ruled out supporting LNG plants and pipelines as many have of Enbridge's proposed $6.5-billion oil pipeline to Kitimat, also in northwest B.C.
However, there are concerns over LNG, including from carbon dioxide and other air pollution emissions that come from the plants, said Art Sterrit, executive director of the Coastal First Nations.
He said Sunday that First Nations want to see the plants use the best global technology to reduce emissions and are watching carefully to see how the industry and governments will respond.
Concerns have also come from environmental organizations.
The Valhalla Wilderness Society has already raised public concerns that the planned pipeline that would feed the Petronas project runs through protected areas adjacent to the The Khutzeymateen Grizzly Bear Sanctuary.
Wayne McCrory, a bear biologist with the society, said it doesn't matter whether millions or billions of investment dollars are at stake, the pipeline should not be allowed to traverse protected areas. "It would be a huge violation of public trust," he said Sunday.
McCrory noted the decision to protect the grizzly bear sanctuary was a societal one that does not permit logging, mining or hydroelectric projects.