Category Archives: Fracking

New Quebec government choosing fossil fuels over green jobs

New Quebec government choosing fossil fuels over green jobs

Canada's fixation on resource economy holding back green jobs
Quebec Premier Philippe Couillard is putting green jobs on the back burner (Photo: facebook)

One thing Stephen Harper, Justin Trudeau, BC Premier Christy Clark and new Quebec Premier Philippe Couillard all share in common is the dated notion that economic and sustainable development are competing concepts that need to be reconciled, with great difficulty. And in hard times, the economy must take precedence.

The term reconciliation seems totally out of place when one considers that the green sectors are among the fastest growing and highest job creation sectors of our time and that this growth can only get better as nations adopt more aggressive approaches to fully participate in the new economy.  Moreover, the green economy is every bit as diversified, if not more so, as Canada’s traditional natural resource-based economy – while offering 6 to 8 times more jobs for the same level of government subsidy as the fossil fuel sectors.

New Quebec government disappoints with green jobs policy

Among its first public statements on the natural resource sectors and environment, the new Quebec Liberal government announced:

  1. A one-year strategic environmental evaluation study (SEE) of the development of fossil fuels in Quebec to be completed in 2015
  2. The continuation of the strategic environmental evaluation (SEE) of the shale oil potential of the pristine Anticosti Island
  3. A new variant of the previous Charest goverment’s Plan nord,  a key component of the Liberal an economic development plan calling for the development of mining potential in Quebec’s northern most regions
  4. Approvals for small hydro facilities on rivers all over Quebec.

What has become clear with the above and other pronouncements by the Couillard government to date is that it is preparing the terrain with inadequate or smoke screen environmental analyses to facilitate full-tilt fossil fuel and natural resource development in the province.

The Economist: China's going green...but is it fast enough?
China invests $70 billion a year in renewable energy

It will do so without assessing the economic costs and benefits – only paying lip service to the opportunities of the green economy.  With regard to the latter point, China is now the world leader in clean energy technologies, having installed 28 GW of new wind and solar capacity in the single year of 2013 while also being a world leader in electric vehicles. Meanwhile, there are currently 3.5M jobs in the EU green sectors.

Accordingly, in  a May 30, 2014 press release, the Liberal government stated that while it is favourable to the development of fossil fuels in Quebec,  it wanted to assure the population that the environment would be protected and safety would be addressed.

As for the rationalization of its interest in the development of the fossil fuel sectors, the Couillard government argues that while awaiting the shift to a green economy, it’s best that Quebec produce its own fossil fuels, rather than importing them. A rather strange line of reasoning since the prime focus on fossil fuels and other non-renewable resources diverts funds that could otherwise be directed towards to the high-growth and high-job-creation green sectors.

Investing in the green economy would offer better returns on public funds and the logic of Couillard’s yesterday’s economy club could entrench new fossil fuel economic dependencies, thus further impeding the migration to a green economy.

Shale gas and oil moratorium in jeopardy

Quebec currently has a moratorium on shale gas development. But all the signals are that the new Quebec government wants to put an end to this moratorium, under the guise of an environmental report which said that with certain precautions and regulatory tweaking, all will be well. Nothing to worry about.


Indeed, Couillard and company want us to think that a one-year strategic evaluation study (SEE) on the development of fossil fuels in the entire province will be more exhaustive than: 1) the two-and-a-half-year study on the development of the shale gas in the St-Lawrence River valley; and 2) the findings of the Bureau d’audiences publiques sur l’environnement (BAPE) (the public consultation office on the environment), which is now reviewing shale gas issues a second time.

The reality is that we are just beginning to grasp the horrors of  fracking. It is not environmentally benign by any stretch of the imagination.

Distorting the evidence on fracking impacts

Fracking has been tied to infant congenital heart defects

Fracking involves a reckless collection of secret, corporate-specific chemical cocktails injected into wells ultimately leave us with the “heritage” of have unchecked methane gas emissions escaping from wells long after the drilling has stopped, and serious prospects for water contamination and air pollution.

Some very substantive, scary, empirical evidence is coming to the fore, but, as with the case of the early reports on the impacts of smoking on human health, the private and government lobbies for shale gas development are implying that the absence of hard, one-to-one cause-effect data means the practice of fracking is safe.

Concerning shale oil, the Quebec Liberals said they will be an investment partner with the private sector to explore the shale oil potential on the of the pristine and huge Anticosti Island. The exploration will proceed this summer, long before the Strategic Environmental Evaluation on the matter is completed in 2015!

As for the much-touted economic benefits of the industry, we only have to look south of the border to see that the shale gas sector in the US is going through a boom to bust cycle, because after one has drilled to get to an easy to access sweet spot in a given well, it’s too expensive to go after the rest. US shale oil is on the same path and a decline in shale oil production may come as early as 2016.

Offshore oil development: Old Harry

The Old Harry potential offshore development area is on the Quebec-Newfoundland border, not very far from the Îles-de-la-Madeleine (Magdalen Islands), an area for which the economy is largely about fishing and tourism.

The Couillard government’s interest in this Gulf of St Lawrence play offers further evidence that the Quebec government, very much like the Harper government, is using inadequate environmental analysis processes to fast track approvals for major fossil fuel projects.

Couillard has already indicated he will sign an agreement with Harper for the development of fossil fuels in the Gulf of the St. Lawrence.  The 2014-15 Budget confirms this intention.

Old Harry
Proposed offshore oil development at Old Harry (Council of Canadians)

With the possibility of developing Old Harry on the horizon, a 3-year, 800-page strategic environmental evaluation report on the Gulf, published in 2013, highlighted the deficiencies of exploration and development technologies – and the biological and human impacts of spills in the region. These risks are particularly high, given the region is covered with ice for much of the year.  The study concluded that Quebec does not have the capabilities to deal with a tanker spill.

The fishing industry in the Gulf represents $1.5 billion/year and tourism $800 million, while the development of Old Harry site on the Quebec side of the border would only generate about $300 million

While the federal government wishes to increase corporate accident liability in the event of a disaster, from $30 million to $1 billion, it is important to note here that the Gulf of Mexico catastrophe cost more than $40B to clean up.

Quebec as corridor for tar sands exports

Included in the “package” of Coulliard’s gung-ho development of the fossil fuel sectors are favourable views on pipelines running through Quebec to ship tar sands oil for export as well as meet Quebec “needs”.  Such is the case with respect to the TransCanada Energy East pipeline to bring Alberta bitumen to the Cacouna port, in the eastern section of the St-Lawrence River.

In this region, any spill would be devastating to both the fragile beluga population and a dozen important natural marine habitat zones.  A spill during the winter would be especially destructive, since there aren’t any adequate means to clean up bitumen in the presence of ice. It would also be devastating to the tourism industry, with $80 million in annual revenues.

Under the Couillard government – not all that different than the position of BC’s Christy Clark government on pipelines – Quebec would take all the risks as a transportation region for the sake of something in the order of 200 jobs. The main beneficiaries would be the exporters of the bitumen to foreign markets via tankers from Cacouna, carrying 80,000 to 200,000 tons of bitumen.

Quebec’s approach mirrors the expeditious National Energy Board smoke-screen evaluations of pipeline safety, meant to distract citizens from the fact that these evaluations do not include emissions associated with tar sands development and climate change.  No wonder the Federation of Chambers of Commerce in Quebec is happy.

Quebec’s new hydro development

Quebec's Romaine River
Quebec’s Rivière Romaine

Despite Quebec’s surplus electricity capacity, for which hydro power represent 94% of the supply, the new Quebec government favours building more dams – much like the BC Liberal government’s private “run-of-river” policy.

Carried over from the preceding PQ government without any changes proposed by the Liberals, on Hydro Quebec’s, site one finds a glowing synopsis from Hydro-Québec on the 1550 MW Rivière Romaine projects.  The web site informs us that, in the name of sustainable development and clean energy supplies for future generations, the 3 new power stations make sense.  No mention is made of Québec’s electricity surplus or that the Romaine is one of Québec’s last “damable” wild rivers.

Not content with having targeted all of Quebec’s great rivers with high hydro power potential, the new Couillard government has also announced approvals for small hydro facilities on rivers with modest hydro potential.

In this regard, this article  – “10 Things You Should Know About Dams” – offers a global portrait on dams to the effect they are are far less environmentally friendly than their proponents care to admit.

Plan nord, Version 2.0

The Couillard government picks up where Jean Charest left off, with an enhanced version of the former Liberal premier’s Plan nord. What Couillard has not factored into his economic vision is the fact that natural resource prices – relative to the prices of finished products manufactured with these very resources – have been declining for the last half century.

Subsidizing cement factories, cutting electric car budget

Last but not least are the following two amazing decisions of the Couillard government.

First, there is the amazing approval under an Liberal austerity Budget 2014-15 of the Port-Daniel cement facility, in the easternmost part of Quebec – the Gaspésie area. The government allotted $450M to support the $1B project, despite the fact that existing cement factories in Quebec are operating at 60% of capacity.

Moreover, the intention is to use the petecoke residues from petroleum/tar sands bitumen refining as a fuel. Petcoke is cheaper than coal but has much higher emissions.

Second, to keep his promise to the preceding PQ government, Couillard has agreed to maintain the transport electricification initiative. However, unlike the PQ, which allocated $500M for this initiative, the Couillard government has de-funded it, with responsibility transferred to Hydro-Québec. Meanwhile, the Liberals are putting a similar amount of funding into the unnecessary and high-GHG emission Port-Daniel cement plant.

This while China’s BYD is manufacturing electric buses and cars and recently built an electric bus manufacturing plant in California. Meanwhile, two Quebec urban transit commissions – the STM serving the Montreal area and the STO serving the Gatineau area – have run pilots projects with BYD electric buses.

That said, battery manufacturing and electric motor stakeholders in Quebec all have to take a back seat to the top priority given to the mining industry under Plan nord. So does the Volvo-owned Nova Bus urban transit facility in Ste-Eustache, which is working on the development of an electric bus.

A Matter of Priorities

Suffice it to say, with the Quebec Liberals – like BC’s Clark Liberals and Justin Trudeau in his promotion of tar sands exports – the environment is being used like an artificially flavoured candy coating to render projects palatable for public consumption, despite the evidence that their projects are not environmentally sound.

Also reflecting Couillard’s sense of priorities are the nomination of his economic Executive and Cabinet ministers, with the Minister of Finance Carlos Leitao, President of the Treasury Board, Martin Coiteux, and Jacques Daoust, Minister of l’Économie, de l’Innovation et des Exportations (Economy, Innovation and Exports). All of them have strong economic backgrounds.

By contrast, the Minister of Développement durable, de l’Environnement et de la Lutte aux changements climatiques (Sustainable Development the Environment and Climate Change), David Heurtel, has no background in environmental fields.

As for the Minister of Énergie et des Ressources naturelles (Energy and Natural Resources) Pierre Arcand, he was the Environment Minister in the previous Liberal Charest government, where he played the role of an eternal apologist for weaseling out of the responsibility for defending the environment.

It’s clear that the environment will not play a key role in Philippe Couillard’s government – despite the clear financial benefits of investing in the green economy.

Haida stand with Fort Nelson First Nation on LNG, fracking concerns

Haida stand with Fort Nelson First Nation on LNG, fracking concerns


Haida stand with Fort Nelson First Nation on LNG, fracking concerns

The Council of the Haida Nation (CHN) is vowing to support The Fort Nelson First Nation’s tough stand on proposed Liquefied Natural Gas (LNG) development and the 600% increase in controversial shale gas fracking it would represent for their northeast BC territory.

According to The Northern View, a recent visit to Haida Gwaii by FNFN Chief Sharleen Gale was met with sympathy from the Haida audience. Gale was there to bring to light the upstream implications if CHN were to support the province’s vision for LNG development, which would also mean significant tanker traffic through Haida waters.

The chief shook up the LNG debate several months ago when she put the BC Liberal government on notice that no development would proceed without proper consultation with her community (see video below).

Haida concerned about upstream impacts of LNG

CHN has been mulling its official position on LNG over the past year. The elected government of the Haisla Nation – across Hecate Strait from Haida Gwaii – has bought into the industry, forging partnerships for LNG terminals in Kitimat. The Haisla quit the Coastal First Nations alliance in 2012 over internal disagreement around LNG development.

Meanwhile, other First Nations along the proposed pipeline routes are opposing this development – many of them citing growing concerns about the upstream implications of these decisions, as support for LNG would mean vastly increased fracking in northeast BC to supply the feedstock.

CHN and other Coastal First Nations members have also been examining the potential impacts of the LNG industry on the coast – everything from air quality and climate issues to the impacts of tanker traffic and dumping bilge water in the marine environment.

Province’s ‘less-than honourable dealings’

According to The Northern View, CHN President Peter Lantin and Vice-president Trevor Russ have twice ventured to northeast BC to learn about the impacts of LNG development on Treaty 8 and Fort Nelson First Nation territories. 

“It would be irresponsible for us to take a position without understanding the effects on the people most affected,” said Lantin following Chief Gale’s speeches to CHN and public gatherings in Massett and Skidegate.

Added Russ:

[quote]Their story is of a people and landscape being overrun by natural gas exploration and extraction and less-than honourable dealings from the provincial government.[/quote]

Grand Chief Stewart Phillip, president of the Union of BC Indian Chiefs, went one step further at a recent town hall meeting on LNG at SFU’s downtown Vancouver campus. “The economy of this province is being built on the destruction of the Northeast,” said Phillip. “The pipelines that are being contemplated by LNG will further destroy the North.”

No support for LNG until First Nations’ concerns addressed

Following these Haida Gwaii meetings with Chief Gale, the Haida Nation decided not to take an official position supporting or opposing LNG “without ensuring that the interests of the people at the source of the LNG are taken care of,” says The View.

Halliburton refuses to disclose fracking chemicals

Halliburton refuses to disclose fracking chemicals


Halliburton refuses to disclose fracking chemicals

By Kevin Begos And Matthew Daly, The Associated Press

PITTSBURGH – The U.S. Department of Energy said Friday that it welcomes the decision by oil and gas industry supplier Baker Hughes to disclose all chemicals in hydraulic fracturing fluid. But Halliburton, a major competitor in the field, isn’t committing to such disclosure.

Deputy Assistant Energy Secretary Paula Gant said that Baker Hughes’ move “is an important step in building public confidence” and the department “hopes others will follow their lead.”

Disclosure loophole allows for secrecy

The oil and gas industry has said the fracking chemicals are disclosed at tens of thousands of wells, but environmental and health groups and government regulators decry a loophole that allows companies to hide chemical “trade secrets.”

Houston-based Halliburton said Friday that it’s studying the move by Baker Hughes, which is also based in that city. Halliburton said it had an interest in protecting “our intellectual property and the substantial investment it represents” and will examine the new Baker Hughes format for its ability to protect such investments.

Baker Hughes ready for 100% disclosure

Baker Hughes said it now believes it’s possible to disclose 100 per cent “of the chemical ingredients we use in hydraulic fracturing fluids without compromising our formulations,” to increase public trust.

Baker Hughes spokeswoman Melanie Kania wrote in an email that it will take “several months” for the new policy to take effect. She said the end result will be a “single list” that provides “all the chemical constituents” for frack fluids, with no trade secrets.

Frack fluids can contaminate groundwater

A boom in drilling has led to tens of thousands of new wells being drilled in recent years using the fracking process. A mix of water, sand and chemicals is forced into deep underground formations to break rock apart and free oil and gas. That’s led to major economic benefits but also fears that the chemicals could spread to water supplies.

The mix of chemicals varies by company and region — and some of the chemicals are toxic and could cause health problems in significant doses — so the lack of full transparency has worried landowners and public health experts.

Many companies voluntarily disclose the contents of their fracking fluids through, a website partially funded by the oil and gas industry that tracks fracking operations nationwide. But critics say the website has loose reporting standards and allows companies to avoid disclosure by declaring certain chemicals as trade secrets.

NWT developing regulatory model for oil fracking in advance of devolution

BC Oil and Gas Commission abandons orphan wells

Clean LNG would be powered by lots of dirty fracking
Fracking operations in BC’s Montney Shale (Photo: Damien Gillis)

Despite admitting there is an increasing trend of inactive well sites awaiting reclamation, the BC Oil and Gas Commission has slashed its budget for its orphan site reclamation fund from $4.83 million in 2013 to just $1 million in 2014.

According to the Orphan Well Association, “an orphan is a well, pipeline, facility or associated site which has been investigated and confirmed as not having any legally responsible or financially able party to deal with its abandonment and reclamation.”

Earlier this year, the BC Ministry of Finance announced the 2014 Budget, focused on LNG development.  According to the budget, the Liberals plan to spend $29 million over the next three years on LNG development alone.  The National Energy Board also approved seven LNG export applications for BC, touted as the basis for a $100 billion Prosperity Fund that will wipe out the province’s debt by 2028.

In order to increase LNG development, the oil and gas industry will have to ramp up drilling, fracking and the number of LNG plants along the coast.

This push to expand LNG resources will create more orphan sites, but the government does not have the funds for reclamation because the Commission has scheduled to cut its cleanup expenditures. According to the BC Oil and Gas Commission’s 2014 Service Plan.

[quote]There is a trend of increasing inactive well sites awaiting reclamation as the industry matures. Delays in the implementation of restoration activities may increase the number of inactive sites and associated liabilities.[/quote]

Gas production in the province

In the northern BC regions of the Liard and Horn River Basins, and Montney shale field, the production from a natural gas well typically declines by 61 to 80-percent in just three years, according to geoscientist, David Hughes’ research. By that point, the well is all but played out, requiring far more drilling to keep up with production demands.

(Photo: Watershed Sentinel)

With the limited lifespan of these wells and the demand the LNG industry will place on fracking in BC, Hughes estimates industry will need to drill a staggering 50,000 new wells by 2040 – twice the total number in the 60 year history of the province’s natural gas industry.

That means the number of wells left behind will sharply increase. For example, the Horn River Basin gas well has a depletion rate of 80-percent in the first three years.

With a budget of $1 million until 2017, the BC Oil and Gas Commission will be unable to keep up with the demand for new sites as industry continues drilling, unable to account for the vast number of well pads reaching orphan stage, leaving more orphan well sites than they are able to responsibly reclaim.

Government and industry are driving a massive experiment in fracking and LNG development without being sure of the consequences for this scale of development.

For instance, in October the BC Ministry of Environment funded the $650,000 Kitimat Airshed Impact Assessment Project to measure the cumulative effects of existing and proposed industrial air emissions in the Kitimat Valley airshed.  The SkeenaWild Conservation Trust accessed this research in their November 2013 “Air Advisory” report, concluding, “this research is being carried out under tight timelines and with a limited budget… raises concerns about whether current research can provide a comprehensive understanding of potential impacts on which to base sound decisions.”

The Kitimat airshed blockage from the current Rio Tinto Alcan aluminum smelter plant’s carbon dioxide emissions has demonstrated the link between human health problems and industrial air emissions in the area.

“It’s a new era and it needs to be spoken about differently than any other time you’ve done gas before,” says Eoin Madden, climate campaigner with the Wilderness Committee.

[quote] I had one call from Fort Nelson First Nation which described it as carpet-bombing. It’s taking wilderness and carpet-bombing it like you would have seen back in Vietnam. It’s that destructive.[/quote]

The concern is that shale gas and LNG are a very different animal from the historical conventional industry with which the province is so familiar.

“When folks hear LNG they don’t realize the danger and that we’re talking about a completely different product from what we’ve traditionally had in BC,” says Madden. “It’s the product that forces us to swap our fresh water for gas and it’s the product that forces us to industrialize enormous amounts of wilderness.”

The unknown consequences of orphan sites

Hydrologist, Dr. Gilles Wendling, presented the unknowns about groundwater in the Yukon in January to the Yukon legislative committee.

“We are extremely ignorant about groundwater,” said Wendling.

[quote]We don’t know where our aquifers are. Even shallow aquifers, we don’t know where they are, we don’t know how big they are, we don’t know how deep they are. We don’t know the water table elevation, we don’t even know in which direction the groundwater moves, we don’t know, we haven’t collected the information.[/quote]

The unknown dangers with old well sites come from the toxic water reserves created during hydraulic fracturing. Not all old well sites become orphan wells. The majority of them are injected with fracking fluid flowback that’s been mixed with toxic additives, such as ethylene glycol, methanol, hydrochloric acid, formaldehyde, mercury, uranium, and lead.  The toxic flowback is then injected deep underground into old oil wells that haven’t become orphan sites.  These types of wells that use this technique of deep oilfield injection are known as disposal wells.  Disposal wells are old wells which use the drilling hole to dispose the leftover fluid from hydraulic fracking.  These disposal wells are then sealed with concrete to prevent open exposure.

Toxic flowback fluid from hydraulic fracking (Photo: Upstream Pumping Solutions).
Toxic flowback fluid from hydraulic fracking (Photo: Upstream Pumping Solutions).

But wastewater-injected wells contain structural risks says Wendling.  Active wells, disposal wells and orphan wells are all subject to native conditions, such as mini earthquakes, that create micro-fractures in the cement seals and corrosion in the casing of the well hole where leaks can happen a year to a decade as the structural integrity of the well degrades.

Well integrity is how wells are sealed and how a well’s sealing capacity will be modified with time.

“Once a hole is drilled in the ground, this hole is drilled forever,” says Wendling.

[quote]This hole goes through various zones which are under different pressures and which contain different types of fluids like gases, or liquids or a mix of the two. Once you have a hole that reaches through various zones and it’s properly sealed then it doesn’t act as a pathway, but with time and depending on induced anomalies, like mini-earthquakes, that cause fracturation – how is this going to effect the integrity of the well, how is it going to create micro-fractures along the well, how is it going to crack the cement seal along the well after one year, five years, ten years, 100 years, how is this going to change with time?[/quote]

If these disposal wells leak after deep oilfield injection, there is potential for our groundwater sources, that feed lakes and rivers, to become contaminated by these hydraulic fracturing chemicals because they can undergo pressure changes in the injection site that acts like a pathway for the mixing of deep and shallow water systems once the well’s integrity is jeopardized.   There is a lot of research being conducted right now to grasp the risks associated with creating and connecting non-native pathways underground through drilling, but there are still a lot of unanswered questions about the dangers of disposal wells and orphan well sites, says Wendling.

Boom and bust economy

Hardy Friedrich, manager of communications for the Oil and Gas Commission in Fort St. John was given the opportunity to comment on the Commission’s plan for orphan well site reclamation but declined to comment in a phone interview.

“We shouldn’t get dragged into conversations about how much money should be spent reclaiming well sites,” says Madden.  “Should the BC government spend money on that, or should Encana, or Talisman, or Apache, whoever made the mess? The way we’re thinking about it is endemic of how much ownership over our politics the oil and gas industry has.”

According to Madden, the dependence on the public to clean up after the energy industry reflects a fundamental problem in Canada’s fossil fuel economy.

[quote]The rules should state if you open a gas well, you’re responsible for remediation.[/quote]

However, that is not the case in BC. Taxpayer money is budgeted by the BC Oil and Gas Commission to reclaim orphan well sites so oil companies can move onto the next drilling project, but this allotted budget for environmental remediation is not enough to keep up with the demand for oil and gas.

In June 2013, Natural Resources Canada mandated that pipeline companies have at least $1 billion of cleanup funds available to deal with incidents.  If the government of Canada is willing to make the polluter pay in the event of a pipeline spill, why doesn’t the government hold oil companies accountable for reclaiming their old well sites as well?

Alternative forms of energy for a sustainable economy and jobs

“The infrastructure I would advocate for right now is an infrastructure that shifts how we think about energy and how we create energy jobs,” says Madden.

[quote]You’ve got geothermal potential, wind, solar power, different ways you can make energy. The question mark is over whether we should even have an export energy market?[/quote]

With the current plan for LNG development there is not enough money in the budget to responsibly account for the necessary cleanup associated with LNG and shale gas development. Without this in place, the BC government risks running their fresh water supplies into the ground, along with their ability to deal with climate change.

“If you’re responsible on the environment, you’re going to create more jobs, that’s the truth,” says Madden.

According to Madden and other critics of LNG development, the government risks alienating public support for its LNG vision if it passes the buck for industry cleanup to taxpayers.

BC LNG faces growing First Nations opposition

BC LNG faces growing First Nations opposition

BC LNG faces growing First Nations opposition
The Unist’ot’en camp’s Toghestiy (left) and Mel Bazil stand in the path of 3 pipelines (Two Island Films)

UPDATE: Fort Nelson First Nation drums government, industry reps out of LNG conference, outraged over lack of consultation on surprise gutting of environmental reviews for gas plants. Government issues swift apology and cancels changes (more below).

One of the biggest myths pervading BC’s energy dialogue goes something like this: While First Nations stand united against the proposed Enbridge pipeline, they overwhelmingly embrace Liquefied Natural Gas (LNG).

Sure, Premier Christy Clark can tick off a list of aboriginal allies in her effort to build at least five among a dozen terminals proposed for Kitimat and Prince Rupert. Just last week, she announced with great fanfare LNG revenue sharing agreements with two coastal nations – Metlakatla and Lax Kw’alaams.

But a growing group of hereditary leaders, grassroots members and their allies, even some elected governments, are rising up in opposition – from the fracking fields of northeast BC that would supply the industry, to the various proposed pipeline routes across the province, to the coastal communities that would house the hulking terminals.

LNG is designed to achieve higher prices for BC’s gas in Asia, by cooling it to -160 degrees celsius, thus liquefying it so it can be loaded onto tankers bound for China, Japan, Korea, Malaysia, and India. But it may be investors who are getting cold feet amid the myriad challenges facing the industry.

Gitxsan Nation hereditary chiefs deliver a cease-and-desist order to TransCanada (Photo: Graeme Pole)

In a little-reported but highly significant development a few weeks ago, a group of Gitxsan hereditary chiefs in the Kispiox Valley, near Hazelton, ordered TransCanada to cease and desist  test drilling relating to the pipeline it plans  to construct to Prince Rupert on behalf of Malaysian, Japanese and Indian LNG partners

The issue adds more uncertainty to the province’s nascent LNG industry, on top of the unified opposition of all five clans of the Wet’suwet’en Nation to the south; mounting concerns from Treaty 8 and Fort Nelson First Nation in the heart of northeast BC’s fracking country; and increasing scrutiny of the proposed Woodfibre LNG Plant in Squamish territory, near Vancouver.

A brief survey of the geography and indigenous territorial boundaries of BC, juxtaposed with these respective challenges, reveals a far more perilous landscape for this industry to traverse than the rosy picture being painted in Victoria and on press junkets to Asia.

Whether you’re a BC taxpayer about to commit massive public subsidies to this industry, or a board member or shareholder of a company contemplating investing the tens of billions of dollars required to build LNG infrastructure, it may be useful to know the real odds before laying a bet on BC LNG.

A tale of two nations: Hereditary vs. Elected

Understanding the discrepancy between the official story on First Nations’ support for LNG and the emerging, contrary reality requires some sense of the different – often competing – systems of governance amongst BC’s aboriginal communities.

Broadly speaking, there are two main forms of aboriginal government: elected and hereditary. The former is a product of the Indian Act – elected band councils which govern reserves created by the Crown. The latter is an ancestral system of  leadership made up of houses and clans – the specific makeup varying from nation to nation. Hereditary governments may also incorporate democratic elements – i.e. not strictly “hereditary” per our western concept of the term – whereby chiefs’ names are passed on through decisions reached in the feast hall or by presiding chiefs or house groups.

Where these systems still exist, hereditary chiefs may hold jurisdiction over their nations’ often vast, resource-rich traditional territories. The Canadian case law on this subject is relatively new and not well defined, but individual nations often have their own laws or internal protocol agreements on the subject of jurisdiction. Elected band councils, meanwhile, are responsible for the much smaller reserves which many First Nations inhabit today. Jurisdiction remains a contentious legal issue, specific to individual nations.  That said, a number of deals involving pipelines and energy terminals have been signed by elected councils, which is sewing conflict in some communities.

Gitxsan: Home of Delgamuukw

In Gitxsan territory – which covers some 53,000 square kilometers surrounding the mighty Skeena River in northwest BC – a rogue chief and head of the nation’s treaty society (another entity which can hold considerable sway in aboriginal communities), Elmer Derrick, stoked a firestorm when he signed an unauthorized deal with Enbridge in 2011. Derrick and his cohorts were promptly evicted from the treaty office and the deal was torn up – by the very hereditary chiefs whose support he had erroneously claimed.

The hereditary system is deeply rooted in Gitxsan culture, as it is with their neighbours to the south, the Wet’suwet’en. These two nations together won the landmark Delgamuukw v. British Columbia case at the Supreme Court of Canada. Some of the same 48 hereditary chiefs who initiated the case in 1984 are still alive today, standing in the path of myriad proposed pipelines.

As this federal government summary of the case explains, Delgamuukw legally entrenched the existence of aboriginal title and rights contained in the country’s constitution:

Delgamuukw confirmed that common law Aboriginal title, recognized as a common law Aboriginal right prior to 1982, was “constitutionalized … in its full form” by section 35 of the Constitution Act, 1982 (par. 133)”

The ruling itself noted: “[A]boriginal title confers more than the right to engage in site-specific activities which are aspects of the practices, customs and traditions of distinctive aboriginal cultures…What aboriginal title confers is the right to the land itself.” However, the court stopped short of confirming Gitxsan and Wet’suwet’en title, requiring a new case be brought to address that matter specifically.

The ripple effects of this decision continue to be felt today and weigh heavily upon the LNG issue.

Gixtsan chiefs evict TransCanada

Gitxsan-Wet'suwet'en map
BC map of First Nations, highlighting Gitxsan and Wet’suwet’en lands

Take a look at the BC Government’s map of First Nations territories. Now, draw a line around the neighbouring Gitxsan and Wet’suwet’en nations (pictured to the right). Note how they form a 500 km-long vertical wall, smack in the middle of every major pipeline route proposed across northern BC. Now you have a glimpse of the trouble awaiting these projects, were both nations to block their path.

And that is precisely what’s taking root on the ground right now, though you wouldn’t know it from Christy Clark’s endless stream of LNG photo-ops touting First Nations’ embrace of the industry.

In late March, Gitxsan Hereditary Chief Wa’a (Samson Muldoe) delivered a letter to TransCanada workers conducting test drilling in the Kispiox Valley, related to one of the two major pipelines being eyed to take fracked natural gas from northeast BC to Prince Rupert (see video below).

The letter, signed by a number of high-ranking hereditary chiefs, stated, “As rightful guardians of the territory on which this work is being carried out, this is to instruct TransCanada Pipelines and its contractors and representatives to cease and desist from this work immediately and to remove all their equipment, vehicles and personnel by the end of Tuesday, March 25th, 2014, and to not return thereafter.”

To the point of governance and jurisdiction, the letter continued:

“We assert that the persons representing the Gitxsan Nation, with whom TransCanada Pipelines has been dealing to this point, do not have legitimate right to make decisions with regards to [the territory] where the work mentioned is now taking place – and that TransCanada Pipelines has thus failed to properly consult, as required pursuant to the Delgamuukw Supreme Court of Canada 1997 ruling.”

The chiefs identified impacts on Skeena River salmon from pipelines, LNG terminals and potential fracking in the region as the prime motives for their action.

Petronas’ magic trick

Petronas-No-SkeenaThe issue is of particular sensitivity given pipeline owner Petronas/Progress Energy’s attempt to erase the Skeena River and estuary from its project description maps (a story broken by The Common Sense Canadian last year). The uproar over the issue, combined with concern about the impacts of the proposed LNG plant on vital estuary habitat during the worst year on record for Skeena sockeye, forced a significant extension to the initial public comment period on the project.

The eviction order is a wake-up call for TransCanada and it should come as no surprise if Spectra Energy, the proponent of the other major pipeline to Prince Rupert, met with a similar notice from the chiefs.

Wet’suwet’en chiefs ban all pipelines

Meanhwhile, several hundred kilometers to the south, Wet’suwet’en hereditary chiefs banned all pipelines – including the proposed Enbridge pipeline and two major gas conduits – through their territory last summer.

Hereditary Chief Na’moks, leader of the Tsayu Clan, explained to me on camera last October that the heads of all five Wet’suwet’en clans had voted to ban all pipelines through their 22,000 square kilometer territory – with unmistakable resolve.

Like the Gitxsan chiefs, Na’moks raised fracking – the ultimate source of this gas – as a key concern in reaching their decision:

“When you’re talking about fracking and the dangers that come with it – the waste of water, the poisoning of water, the waste of land…when we allow pipelines, we have to take that responsibility that we’re supporting this industry to continue that. As Wet’suwet’en, we can’t do that.”

LNG means 50,000 new holes in the ground: geoscientist

Horn River fracking
A fracking drill in BC’s Horn River Basin (Two Island Films)

Why all the concern about fracking? Because, despite the oxymoronic “Clean LNG” label applied so liberally by the Clark government, the reality is the enormous volume of LNG exports already licenced by the National Energy Board would require the ramping up of environmentally damaging fracking to supply the feedstock – as much as a five-fold increase from present levels in the province.

According to the retired leader of the Geological Survey of Canada’s national shale gas potential review, globally renowned geoscientist David Hughes, BC’s LNG plans would require 50,000 new fracked wells by 2040 – double all the gas wells drilled in the 60-year history of the province’s natural gas industry to date. This would result in the contamination of tens of billions of litres of fresh water every year – while the LNG and fracking program could very well more than double BC’s entire carbon footprint! 

So these chiefs are right to be concerned about the implications of LNG plans in terms of increased fracking and environmental impacts.

Unist’ot’en Clan holds the line

At the end of a series of forest service roads west of the sawmill town of Houston, BC, lies a solar-powered cabin on the banks of the Morice River. It may soon become ground zero in the battle over BC’s proposed pipelines.

There, members of one of the five Wet’suwet’en clans, the Unist’ot’en, have been strategically occupying their land – directly in the path of two gas pipelines and the Enbridge pipeline –  for several years now. Their position is simple: No pipelines will cross their territory, period. They’ve already evicted contractors doing survey work for one of the proposed pipelines, Chevron and Apache’s Pacific Trails project.

I’ve visited the camp on two occasions – this past winter and in its early days in the summer of 2012 – for my forthcoming film Fractured Land. It’s a beehive of activity, with supporters regularly joining the camp for weeks to assist with various chores, the construction of new facilities, and gathering and preparing food.  

The Unist'ot'en camp has raised close to $20,000 to renovate its bunk house
The Unist’ot’en camp has raised close to $20,000 for bunk house renos

They work to feed themselves in a traditional manner from hunting, trapping and fishing, though one of the camp’s leaders, who goes by the traditional name of Toghestiy, acknowledged to me on a tour of their trapline this winter that with diminished wildlife following years of logging in the region, they are forced to supplement their traditional diet with other food sources.

Though the group runs the risk of being characterized as militant radicals, that would appear, on closer inspection, to be a gross misunderstanding of their motives and philosophy. “We’re not about a fight,” camp regular Mel Bazil explained on our last trip. “I don’t wake up thinking, ‘Is the fight coming on today?’…We’re prepared to protect ourselves, but we’re more prepared to build with people a shared responsibility that we can really believe in – that will not occur from a board room or a government level.”

Many of the camp’s members are are schooled in both western universities and the traditional ways of their people, having left high-ranking jobs in aboriginal governance, social work and other fields to embrace a different way of life, in reaction to serious challenges facing their land and people.

“This planet is in trouble. If we can all agree upon that and not worry about how media and governments are spinning it, we really must all, as a people, take control of ourselves.”

Injunction being sought?

Born into another Wet’suwet’en clan, Toghestiy is married to Freda Huson of the Unist’ot’en, the camp’s frequent spokesperson. The pair were in Vancouver last week for an emergency press conference, after they caught wind of an alleged plan by government and industry officials to obtain an injunction against their camp.

When pressed by the Globe and Mail’s Mark Hume, Chevron representative Gillian Robinson-Riddell denied seeking an injunction. She did, however, seem to acknowledge that the company has yet to secure the social licence it requires from First Nations to commit fully to the project financially:

“We’re working toward a final investment decision but there are a few factors [that have to be confirmed] yet…We are looking for further First Nation support.

Video by Eric Doherty

Camp building broad support

The Unist’ot’en are currently running a crowd funding campaign to further build up their camp. With several weeks to go, they’ve nearly met their goal of $20,000 – evidence of the broad support their cause is attracting. From the looks of it, the group isn’t going anywhere – certainly not without a Herculean effort on behalf of government, industry and law enforcement that could well backfire under public scrutiny.

Canada: The world is watching you

When I asked Ms. Huson what would happen if authorities tried to serve an injunction, she replied:

“Supporters would walk off their jobs and come join us. People from all over have said busloads would come to our camp.” Others as far away as Ontario “would close highways” in sympathy.

“My message is: “Canada, the world is watching you.”

I asked Ms. Huson what she would say to the elected chiefs who have signed LNG deals. “I would ask them, ‘Have you done your homework?'” she replied. “Have you investigated how LNG plants affect the air and water; how you will affect not just your communities, but people upstream and downstream?…And what would your ancestors do?

More First Nations opposition brewing

In northeast BC, First Nations leaders have long worked to balance the natural gas industry’s job benefits to their members with its environmental impacts. But with the shift from conventional gas to riskier fracking, change is in the wind.

Now, as they peer over the horizon at a massive build-up of fracking to feed these proposed LNG terminals, they are  increasingly expressing concern for the future. The Fort Nelson First Nation came out swinging in 2012 against 20 proposed long-term water licences for fracking in their territory, forcing the government to pull them off the table – with the exception of one, which is currently being litigated by the band.

In 2013, Chief Sharleen Gale and Lands Manager Lana Lowe co-penned an op-ed in The Globe and Mail, which stopped short of opposing the industry, but raised alarm bells over the implications of LNG for their territory – calling for increased environmental standards and royalty sharing to compensate their community. If anything, their estimate of future impacts was highly conservative, in light geoscientist David Hughes’ figures and the Clark government’s bullish outlook for building LNG plants:

“Should a modest number of LNG plants be built we anticipate at least 3,000 new wells will be drilled and fracked over the next decade. This will remove millions of tonnes of frack sand from our land, and trillions of litres of water from our rivers, unleashing a race for large-scale industrial frack sand mining and freshwater withdrawals…Industry has already proven unable or unwilling to stay within the generous water allocations provided to them for fracking.”

Fort Nelson’s Treaty 8 neighbours, in BC’s Peace Valley Region to the south, have also expressed growing concern about the impacts of water withdrawals for fracking on the drought-stricken territory.

The final straw

Finally, in a surprise turn of events this week, Fort Nelson First Nation members, led by the strong words of Chief Gale, literally drummed out government and industry representatives from a conference the band was hosting on liquefied natural gas (LNG).

The 3-day conference, titled “Striking the Balance”, was designed to discuss both the economic opportunities and potential environmental impacts of increased fracking in the nation’s territory. But things got off on the wrong foot when the BC Liberal government made a surprise announcement on Tuesday that new sweet gas processing plants would be exempted from environmental assessment.

Chief Gale alluded to the betrayal in her comments from the podium at the event today:

“The word from my elders is you treat people kind. You treat them with respect even when they’re stabbing you in the back…so I respectfully ask government to remove themselves from the room.”

Several dozen government officials promptly arose and left, to the beating of Dene drummers. LNG and shale gas industry representatives were asked to stay behind for a few minutes to hear about the nation’s concerns in greater detail, after which they too were dismissed. (see video here).

The message was received loud and clear by the Liberal government, as Energy Minister Mary Polak issued a swift, statement repealing the planned change to the province’s environmental assessment laws.

“I would like to acknowledge First Nations concerns about amendments to the Reviewable Projects Regulation under the Environmental Assessment Act,” stated Polak. “Our government apologizes for failing to discuss the amendment with First Nations prior to its approval.”

Non-BC First Nations take hard line against fracking

Fracking faces increasing opposition from First Nations in other Canadian provinces too. The Council of Yukon First Nations – which represents the majority of aboriginal groups in the territory – imposed a ban of their own last year, on top of the Yukon Government’s own, albeit temporary, moratorium.

Meanwhile, in Mi’kmaq territory last year, test drilling by American fracking company SWN Resources triggered a heated clash between Elsipogtog First Nation protestors and RCMP riot police. The incident sparked a wave of protests in sympathy, as far away as Vancouver. While the issue temporarily cooled off after SWN wrapped up its testing, it is sure to flare up again if and when they return to commence fracking.

As Common Sense Canadian contributor Kevin Logan asked last year, is Elsipogtog the spark that will light the fire of fracking protest amongst other First Nations in places like BC and Alberta? Fort Nelson Chief Gale and Lands Manager Lowe suggested as much in their Globe editorial at the time:

[quote]Sadly it has taken the images from New Brunswick over the past two weeks to raise the debate around “shale gas” to the national stage. It has taken Elsipogtog people being arrested, and images of burning vehicles to illuminate how raw the tension is between the indigenous peoples, and the federal and provincial governments around unchecked resource extraction…We feel particularly close to our relatives in New Brunswick. We share a connection through our treaties and our concern for the land, water and air and the future generations in the face of shale gas.[/quote]

BC LNG a risky bet

The BC Liberal government is banking on support for LNG from First Nations based on the jobs it is dangling before them – as bloated and unrealistic as these claims clearly are. Now-Minister of Natural Gas Development Rich Coleman told political pundit Vaughn Palmer in 2012, “One of the greatest outcomes for this would be that every First Nation young person coming through in the next ten years can get a trade or a job…in the LNG business.”

Premier Christy Clark defends LNG industry's carbon footprint
BC Premier Christy Clark (Photo: Tina Lovegreen)

But in order for BC LNG’s ship to set sail, it will require hundreds of billions of dollars in private capital – not to mention huge taxpayer subsidies. And there are already myriad signs that this boat won’t float – from the government’s difficulty in developing a long-delayed export tax regime, to the lack of a single major investment commitment from any proponent in the 8 or so years the industry has been brewing.

At some point, investors will be confronted with the fact that, on top of all the other risks associated with this incredibly costly and volatile industry, they face growing opposition from First Nations.

Even in the best of circumstances, LNG is a gamble. Given the odds facing BC’s attempts to build an industry, I’d think long and hard before laying my chips on the table.

EDITOR’S NOTE: The passage on hereditary vs. elected governments has been updated since original publication to better reflect the nuances of this subject.

Rex Tillerson, you are a big, fat NIMBY

Rex Tillerson, you are a big, fat NIMBY

Rex Tillerson, you are a big, fat NIMBY
ExxonMobil CEO Rex Tillerson loves fracking other people’s back yards – just not his own

Dear Rex Tillerson,

I am writing to express my disappointment in learning that you recently opposed the construction of a water tower essential to shale gas development near your home in Texas.

As you and I both know, hydraulic fracturing – or “fracking”, as rabid environmentalist-types refer to it – is a game-changing technology that presents many wonderful opportunities to the American people and economy. Your company, ExxonMobil, has been a global leader in its development, for which I applaud you, as CEO.

I recognize that you are concerned the value of your $5 million home will be negatively affected by the construction of this 160-foot water tower – and you are likely right.

But sometimes in life, we are called upon to take one for the team – and this is just such a moment. By acting like every other pinko, tree-hugging NIMBY (Not In My Back Yard) who stands in the way of progress by protesting the alleged impacts of fracking and related activities on their property values and family’s health and well being, I feel you are setting a very bad example for the rest of the country.

Just think – now every time a fracking company wants to suck a lake dry or inject poisonous chemicals into fresh water, or raise the risk of earthquakes from fracking, they will be able to point to you and say, “Yeah, but…the CEO of Exxon protested it too!”

Can you imagine the potential consequences for America’s economy? As you’re well aware, shale gas offers billions of dollars in economic opportunities, gazillions of jobs, and the ability for America to become energy independent – and you want to put all that at risk because your home might go down in value by a measly few million bucks?!

You had me worried when you acknowledged that human-caused climate change is real (beg to differ), but when you told those environmentalists that it’s no big deal and people who are affected by it should just move, you regained my confidence. You have always worked hard to promote the virtues of fracking and dismiss those pesky greenies, farmers and such – and for that, I admire your leadership.

But as for this water tower, I suggest it’s time you suck it up and deal with it, like so many millions of other Americans have had to.

Otherwise, not only will the environmentalists hate you, but so will all us reasonable folks who believe in the vision you’ve sold us about our energy future.

For the love of shale, please don’t be just another NIMBY, Rex!


A concerned citizen for energy progress

David Suzuki-Trading water for fuel is fracking crazy

David Suzuki: Trading water for fuel is fracking crazy

David Suzuki-Trading water for fuel is fracking crazy
Fracking protest in New Brunswick (photo: Colin McPhail)

It would be difficult to live without oil and gas. But it would be impossible to live without water. Yet, in our mad rush to extract and sell every drop of gas and oil as quickly as possible, we’re trading precious water for fossil fuels.

A recent report, “Hydraulic Fracturing and Water Stress”, shows the severity of the problem. Alberta and B.C. are among eight North American regions examined in the study by Ceres, a U.S.-based nonprofit advocating for sustainability leadership.

Fracking happening is regions of “high water stress”

One of the most disturbing findings is that hydraulic fracturing, or fracking, is using enormous amounts of water in areas that can scarcely afford it. The report notes that close to half the oil and gas wells recently fracked in the U.S. “are in regions with high or extremely high water stress” and more than 55 per cent are in areas experiencing drought.

In Colorado and California, almost all wells – 97 and 96 per cent, respectively – are in regions with high or extremely high water stress, meaning more than 80 per cent of available surface and groundwater has already been allocated for municipalities, industry and agriculture. A quarter of Alberta wells are in areas with medium to high water stress.

Fracking will compound California’s 500-year drought

Drought and fracking have already caused some small communities in Texas to run out of water altogether, and parts of California are headed for the same fate. As we continue to extract and burn ever greater amounts of oil, gas and coal, climate change is getting worse, which will likely lead to more droughts in some areas and flooding in others.

California’s drought may be the worst in 500 years, according to B. Lynn Ingram, an earth and planetary sciences professor at the University of California, Berkeley. That’s causing a shortage of water for drinking and agriculture, and for salmon and other fish that spawn in streams and rivers. With no rain to scrub the air, pollution in the Los Angeles area has returned to dangerous levels of decades past.

BC, Alberta could face similar problems

Because of lack of information from industry and inconsistencies in water volume reporting, Ceres’ Western Canada data analysis “represents a very small proportion of the overall activity taking place.” Researchers determined, though, that Alberta fracking operations have started using more “brackish/saline” groundwater instead of freshwater. The report cautions that this practice needs more study “given the potential for brackish water to be used in the future for drinking water” and the fact that withdrawing salty groundwater “can also adversely impact interconnected freshwater resources.”

Although B.C. fracking operations are now mainly in low water stress regions, reduced precipitation and snowpack, low river levels and even drought conditions in some areas – likely because of climate change – raise concerns about the government’s plan to rapidly expand the industry. The report cites a “lack of regulation around groundwater withdrawals” and cumulative impacts on First Nations lands as issues with current fracking.

“Everything must go”

Ceres’ study only looks at fracking impacts on freshwater supplies, and offers recommendations to reduce those, including recycling water, using brackish or wastewater, strengthening regulations and finding better ways to dispose of fracking wastewater. But the drilling method comes with other environmental problems, from groundwater contamination to massive ecosystem and habitat disruption – even small earth tremors – all done in the name of short-term gain.

It’s important to heed the conclusions and recommendations of this study and others, but given the problems with fracking, and other forms of extraction, we must find ways to control our insatiable fossil fuel demand. That burning these – often wastefully – contributes to climate change, and our methods of extraction exacerbate the problems, should make us take a good look at how we’re treating this planet and everything on it, including ourselves and generations to come. It’s a reminder that we need to conserve energy in every way possible.

In the short term, we must realize that we have better ways to create jobs and build the economy than holding an “everything must go” sale on our precious resources. In the longer term, we must rethink our outdated economic systems, which were devised for times when resources were plentiful and infrastructure was scarce. Our highest priorities must be the air we breathe, the water we drink, the soil that provides food and the biodiversity that keeps us alive and healthy.

With contributions from David Suzuki Foundation Senior Editor Ian Hanington. 

Exploding BC LNG Myths - Part 1

Exploding BC LNG Myths – Part 1


Exploding BC LNG Myths - Part 1

The BC Government recently published an online quiz to “test the knowledge” of British Columbians on the coming LNG revolution.

It amounted to a propaganda exercise with the sole purpose of testing how well the BC Liberal LNG rhetoric has pierced the minds of the BC populace.

The infamous Harold Evans, longtime Editor of the Sunday Times of London and author of many books is quoted as saying:

[quote]Propaganda is persuading people to make up their minds while withholding the facts from them.[/quote]

We used to rely on the muckrakers of the “fourth estate” to inform us of the goings-on in government. However, today we neither elect governments who work in our best interest nor have media that informs – rather, the two work in concert to ensure we are well propagandized, as defined by Mr. Evans.

It used to be that resource companies handled their own communications, did their own advertising and managed the public affairs of their undertakings; today that job now involves governments and (E)NGOs (environmental non-governmental organization).

Our elected leaders in government and the self-appointed leaders in NGOs have abandoned positioning in the public interest and instead have become partners in the exploits of international capital, who provide perception and issue management on their behalf.

Therefor the following clarifications may help with understanding the BC LNG fundamentals from the citizen’s perspective, otherwise known as the owner of the resource and stewards of the land, air and water, versus those committed to providing perception and issue management -otherwise known as “social license.”

The BC Liberal government’s “LNG Quiz”

BC Liberal LNG myths and realities

CLAIM: LNG just evaporates if there is an accident transporting it, loading or shipping the product on the coast.

FALSE:  Rapid Phase Transition can occur when LNG meets water, resulting in explosions. See video here. The effect is much more explosive with terrestrial transportation, as seen here.

CLAIM: There is a race to develop BC LNG facilities.

FALSE: Every major industry report points out how LNG is a growth industry, one of the biggest on earth and is reaching its apex after over 50 years in existence. Demand is expected to escalate for at least 30 years as we see the transition to natural gas as transportation fuel take hold.

CLAIM: To win the race we need to hurry in order to satisfy our customers and serve domestic markets before our competition beats us.

FALSE: There is no other place in the world with our proven deposits at our stage of development (speculative) that also has the level of interest being expressed. The BC Liberals have been boosting natural gas exports for over three years, however the development model we are undertaking means we have no “customers”, only new potential owners.  If this is a race, “BC” jumped out of the saddle before it started and handed over the reigns to foreign companies and SOEs, The LNG destination markets will only grow as will domestic consumption.

CLAIM: LNG will erase debt, lower taxes and fill a 100 Billion Dollar Prosperity Fund.

FALSE: The BC Liberals have accumulated more debt than any government in history.  Christy Clark incurred more debt in just two years before the last election than the entire NDP “decade of decline.” And that is only debt they acknowledge. Unacknowledged debt that exists as of today, in both deferred and hidden public accounts, exceeds the expected revenues from LNG exports, given the terms and conditions her government has so far defined.

CLAIM: The BC Liberals continue to claim “we” will be the most competitive in the world by slashing royalty and tax regimes, while maintaining high subsidies, and becoming the lowest operating district on earth.

PARTIALLY TRUE: It is true that the BC Natural Gas Royalty Regime has often been cited as the lowest in North America and subsidies for the industry are often unparalleled, however it is unclear if this is true the world over. Qatar, the current world leader in the industry, is very difficult to compete with in this respect. This means that BC will have to continue to “give the gas away” in order to be competitive on the world stage – especially when considering our major deposits’ distance from tide water and the costs involved as a result. (On average a compressor station is required every 100 miles along a gas pipeline).

CLAIM: The BC Liberals have long claimed they intend to “lock down” all terms associated with the budding LNG industry by passing “sophisticated provincial legislation” they have repeatedly announced would be made available to the public, yet continue to be delay. (Indeed they claimed they cancelled the last sitting of the legislature to craft this sophisticated legislation, but to no avail.)

REALITY: No provincial government can legislate in perpetuity. It’s a fundamental tenet of democracy that subsequent elected governments not be limited in this capacity. The only existing experience we have with such draconian lawmaking exists within the parameters of trade agreements, which are treaties negotiated and ratified at the level of the Federal government. Expect BC’s LNG industry to be bound by upcoming trade agreements such as FIPPA and TPP, as these are the only means of “locking down” bargain basement taxation and regulatory regimes.

CLAIM: Natural Gas is a “clean” transition fuel.

MISLEADING: When processed natural gas liquids are burned, they are cleaner than some fossil fuel alternatives, however there is a lot of processing that occurs between the time it is removed from the earth and ultimately burned. Those processes release more climate changing emissions and poisons than the alternatives. There is also the issue of “fugitive”, or escaped methane emissions, which studies are now revealing to be far more widespread and climate-damaging than previously thought.

CLAIM: Natural Gas is a “clean energy” alternative to coal.

FALSE: While “natural gas” is often boosted as a clean energy alternative, studies show that the entire LNG lifecycle – from fracking, processing through squeezing, freezing and shipping, regasification and final consumption – CO2 emissions are worse than coal, certainly when fugitive emissions are accounted for. In fact, meeting the government’s target for 3 LNG plants by 2020 and 5 in total would make achieving its own climate targets utterly impossible.

CLAIM:  “We are doing the world a favour,” because our natural gas will displace coal burning plants in China improving the environment and air quality.

FALSE: There is no actual evidence of this claim or any commitment of this sort. Coal exports to Asia are at record highs in both Canada and the US and China is already making deals to export LNG after having increased domestic production 5 fold just in the last year.

Part two will continue debunking major claims around the development model of BC LNG. Jobs, social impacts, fracking and the government’s soon-to-be-introduced “framework” for LNG development, which they have chose to provide in lieu of the promised terms and conditions required for the much-vaunted “Prosperity Fund”, will all be included. 

Alberta fracking licenses soar by 650 per cent, documents reveal

Alberta fracking licenses soar by 650%, documents reveal

Fracking on the rise in Alberta, documents reveal
Photo: Damien Gillis

by Dean Bennett, The Canadian Press

EDMONTON – Alberta New Democrats say newly released documents show fracking has become an unregulated free-for-all in the province with no regard for the impact on groundwater or on people’s health.

NDP Leader Brian Mason presented information Tuesday provided under freedom-of-information laws that shows the number of hydraulic fracturing licences granted by the province soared 647 per cent last year to 1,516.

Water withdrawals increasing dramatically

Mason said the amount of water allocated and used for fracking has increased even faster.

“Most Albertans don’t realize that fracking in Alberta is almost completely unregulated,” he told a legislature news conference.

“And it is increasing on a dramatic scale without any understanding of what the potential consequences will be.”

He said the water loss alone is sobering, with more than 17 million cubic metres used in 2013.

[quote]This is an enormous amount of groundwater. It’s pumped into the ground, it’s polluted by chemicals and it’s never seen again.[/quote]

Fracking blasts pressurized water and chemicals into underlying rocks to release trapped natural gas and oil.

Fracking divides communities

It has changed the game on North American resource extraction in the last decade — fuelling an oil and gas boom in North Dakota and delivering a 15 per cent overall production increase south of the border, according to Alberta government data.

It has also resulted in a backlash from environmentalists and from homeowners who live near fracking sites. Their main concern is polluted groundwater and aquifers.

In Lethbridge, homeowners and city council are fighting an application by Calgary-based Goldenkey Oil to drill three wells using vertical hydraulic fracturing within city limits and within one kilometre of where people live.

The legislature members for Lethbridge — Progressive Conservatives Bridget Pastoor and Greg Weadick — have told residents they are making sure concerns are heard. Mason said they two need to go farther and actively fight the development.

[quote]They’re mealy-mouthed hedging on the whole question.


Too late for Alberta fracking moratorium?

Fracking has brought with it controversy in other provinces. Newfoundland and Labrador, Nova Scotia and Quebec are re-evaluating its benefits versus the consequences of environmental damage.

Mason said it’s too late for a moratorium on fracking in Alberta.

“The horse is kind of out of the barn. It’s a mainstream activity now.”

He suggested Premier Alison Redford’s government should undertake an independent scientific review of hydraulic fracturing and use independent groundwater monitoring before further projects get approved.

Environment Minister Robin Campbell disagreed with Mason. He said in a news release that “Alberta has strict regulations that apply to all oil and gas development regardless of the technology being used.”

Campbell also said concerns of environmental damage have not been borne out.

“To date, there has not been a documented case of hydraulic fracturing fluids contaminating a domestic water well in Alberta. For anybody to claim that the water supply is at risk is completely false,” said Campbell.

“All water licence applications are carefully reviewed to ensure no significant impacts to our environment or other water users.”

Shale gas, LNG exports and the elephant in the room

Shale gas, LNG exports and the elephant in the room


Shale gas, LNG exports and the elephant in the room

I listened intermittently to the Public Proceedings of the Yukon Legislature’s “Select Committee Regarding the Risks and Benefits of Hydraulic Fracturing” held in Whitehorse on January 31 and February 1. The presentations focussed mainly on the minutia of drilling, hydraulic fracturing, water consumption, environmental impacts, regulations, water contamination and so forth. These are certainly valid concerns, but the big picture as to why the BC and Federal governments are pulling out the stops to liquidate the natural gas resources of BC and the southern Yukon and NWT at an unprecedented rate, and the implications of doing so, were not discussed.

David Hughes
David Hughes

I particularly focussed my attention on the final presentation by the National Energy Board (NEB) and the questions following it. As Canada’s energy regulator with responsibility for future Canadian energy security I hoped I would hear a rational explanation for its BC LNG export approvals totalling more than Canada’s current production, which, if they were to come from BC, would require more than quadrupling current production. I was sorely disappointed. Instead NEB presented a rendition of the process of hydraulic fracturing and assurances of the NEB’s good work on the regulatory front.

The Elephant: Scale, environmental impact and energy security

During the NEB Q&A, when the public’s questions finally came up, 20 minutes before the end of the two-day session, several questions were posed about the implications of the scale of LNG exports proposed by the BC Government and approved by the NEB.

Given that most of the proponents for LNG export terminals approved by the NEB utilized a single Calgary-based consultant for their supply forecasts, one of the questions asked “how reliable is this consultant for future supply forecasts?”. The NEB’s Patrick Sprague declined to comment on the reliability of the consultant and responded that the NEB had its own forecasts published on the web (Canada’s Energy Future, published November, 2013). It’s worth comparing the two.

The consultant, in the employ of Aurora Liquefied Natural Gas Ltd. – wholly owned by China National Offshore Oil Corp. and Japanese companies – came up with a remarkably rosy supply picture to justify Aurora’s LNG export aspirations. The consultant suggested that a miraculous turnaround of Canada’s long-standing production decline will nearly double Canada’s gas production by 2035, thanks to shale gas and tight gas (Figure 1). The consultant does not provide justification for its forecasts beyond stating:

[quote][We maintain] proprietary gas production spreadsheet models for each major gas basin and key gas types in North America which use key input parameters to forecast the annual average gas production for each supply source to 2050.[/quote]

In short the consultant says “trust us”. Others might say “follow the money” – who is paying this consultant and what conclusions are in the best interests of its clients? The consultant’s conclusions are certainly in the best interests of its clients and are opposed to other analyses of the “shale revolution”.

Canadian gas production-Ziff-Aurora
Fig. 1: Consultant forecast of Canadian gas production through 2050 – included in the Aurora Liquefied Natural Gas Ltd. application filed with the NEB in November, 2013

This supply forecast is much more optimistic than even the NEB’s reference case projection, which is 20% lower in 2035, despite an assumed four-fold increase in BC gas production (Figure 2).

Projections ignore reality of peaking shale gas production

How credible are the supply forecasts prepared by this consultant and included in most of the export applications the NEB has approved? They belie what is actually happening with shale gas production in the US and what is likely to happen in the future with production and price.

With the exception of the Marcellus play in Pennsylvania and West Virginia (and associated gas from tight oil plays like the Bakken and Eagle Ford), major shale gas plays have peaked and are declining. The Haynesville play in Louisiana and east Texas is down nearly 35% from its peak just two years ago when it was the biggest shale gas play in the US. Other plays like the Barnett, Fayetteville and Woodford are also declining. As a result overall US gas production is flat, and Canada’s production is declining. Forecasting a radical increase in production, at low prices, to accommodate its client’s LNG export aspirations, as this consultant does, is not credible.

LNG exports mean 72% more than total current Canadian gas production

The NEB has approved seven export terminals with a total capacity of 14.6 billion cubic feet per day (bcf/d). If the Aurora proposal is approved that will add a further 3.1 bcf/d for a total of 17.7 bcf/d of exports. Coupled with BC’s current raw gas production of 4.2 bcf/d that would require BC to produce nearly 22 bcf/d, which is 72% more than all of Canada’s current production.

My analysis estimated a conservative 50,000 new gas wells to meet just 14 bcf/d of exports, which would amount to tripling the 25,000 wells that have been drilled since the 1940s and quintupling the amount of gas produced since then. Questions posed at the hearing on what the environmental implications of fracking a well are one thing – drilling 50,000 of them are another. And what about the long term energy needs of the rest of Canada?

Fig. 2: Reference case projection of gas production by province through 2035

LNG exports could mean higher gas prices at home

Another important question posed during the Q&A to the NEB was what the price impacts might be on North American gas of LNG exports. Current NYMEX prices are nearly triple what they were in mid-2012, yet production is flat overall and falling in several major shale gas fields.  Production can only resume rising with considerably higher gas prices. The Clark government’s plan, however, is to capitalize on the differential between the currently cheap North American gas price and the price of LNG in Asian markets. Given that the cost to liquefy, transport, and regasify a thousand cubic feet (mcf) of gas is about $6.00, the cost of the gas itself is about $4.50, and the price in Asia is $14.00 or more, there is a potential profit of $3.50 per mcf. If the domestic price of gas rises, as it must to avoid production decline, the profit margin disappears along with all the revenues for the “Prosperity Fund” and debt-paydown touted by the Clark Government.

The increased demand for natural gas in the US for power generation (given shutdowns of coal plants and nuclear stations), and for industrial uses, mean that US and Canadian LNG exports can only further strain supply and increase upward pressure on prices.

Regulators, governments missing the big picture

The attendees at the “Select Committee Regarding the Risks and Benefits of Hydraulic Fracturing” hearings were well served on the details of hydraulic fracturing but the bigger picture of the wisdom of this unprecedented scale-up in extraction and what it means for the long term energy security of Canadians – The Elephant – was largely ignored. This is to our peril given the non-renewable nature of the resources being exploited, the scale and rate of extraction envisioned, and the need for these resources for the foreseeable future as inputs to Canadian energy requirements.