Rafe: Clark govt in over its head with big LNG players like Petronas

Photo: Tina Lovgreen / BCIT Commons
Photo: Tina Lovgreen / BCIT Commons

Many long years ago, when I was in first year Law, we learned a case called the Carbolic Smoke Ball case. This involved a patent medicine and great claims were made for its virtues. There was a lawsuit because a user of this patent medicine was not satisfied with the result, which he said was nil. This was apropos in those days, since in B.C. we were constantly exhorted to buy Dodds Kidney Pills, which had nothing to do with kidneys, and Carter’s Little Liver Pills, which had dick-all to do with livers.

The court drew the distinction between statements by advertisers to be taken seriously and what it called “mere puffery”.

I got to thinking about this in political terms. Obviously politicians, the more so the closer they get to an election, indulge in a lot of “mere puffery”. They also make statements which are intended to be taken seriously. The trick is, which is which?

The fib that won the election

Clearly the statements made by Premier Clark prior to the last election about the so-called “Prosperity Fund” and LNG plants galore were well beyond “mere puffery”. She got very specific and not only were we to have all our debts paid off but the fund itself would hold $100 billion, later reduced to simply billions of dollars and now, I understand, $1 billion.

Needless to say, all of these figures were preposterous, no matter how successful the premier’s LNG undertakings were.

We were also to have an LNG plant in place by 2015.

I think one can argue that the election was won on these promises, along with the vague promise that business would be good under the Liberals and bad under the NDP. The premier engaged Brad Bennett – son of and grandson of – to help her spread this message and she snatched victory from the jaws of defeat by so doing.

The LNG mystery

There is nothing wrong, and a lot right, with a government having a policy. This policy, however, must be clearly spelled out so that the public can follow its progress. I must say that the policy of LNG plants is something I have long had great doubts about, however I am not the government and I am not making the policy.

Apart from the fact that any LNG policy is opposed by a great many, including myself, on environmental grounds, it’s main sin is that nobody knows what it is. This uncertainty has been compounded not only by the mythical Prosperity Fund but the mysterious process, if there is one, by which LNG projects will come to British Columbia.

Petronas and that pesky “red tape”

The latest debacle with Petronas, the Malaysian energy giant, simply proves the point.

Petronas seems to make it clear that it cannot live with the terms proposed by the BC government, especially its proposed 7% tax. This objection was made very publicly by the CEO, Mr. Abbas, leaving in the minds of most of us no doubt but that the company was on the brink of pulling out. Moreover, Mr. Abbas made it abundantly clear that Petronas was not interested in any environmental regulations whatsoever. (Industry usually refers to such regulations as “red tape”.)

This event was shunted aside by the premier and her minister, saying that Petronas was merely negotiating in public, that all was well, and that in no time the government and Petronas would be holding a celebration.


In reading the statement by Petronas’ CEO, I was struck by the objection to  environmental regulations and my thoughts raced to the Mount Polley Mine disaster.

To large companies,”red tape” means regulations that make them behave themselves. This raises the question as to whether or not the province was being called upon to allow Petronas to do as it pleased, meaning that we could look forward to the kind of disaster we saw with Mount  Polley.

Lessons from Mount Polley

In that case, we now know that there were known problems with the burst dam for years before the tragedy and that nothing was done. Nothing was done by the company but more importantly by the British Columbia Ministry of Mines. That they had power to do something is clear – that they failed to do so is likewise clear. Even, it seems, regulations in place don’t prevent governments on the take from industry from ignoring them.

Are we being played?

What this all raises is the question, “just what the hell is going on?” Surely the public is entitled to know what the terms are for LNG plants coming to British Columbia – not just the financial terms but the environmental terms as well. Are we expected to forego environmental protections? What are the taxes that Petronas and others will be expected to pay? Is the 7% tax a fixed tax? What value does it offer if they can deduct their tens of billions of dollars in plant and pipeline costs before paying out a penny to taxpayers? Is such a tax in accordance with industry norms? If not, what is? Are we in fact being whipsawed by Petronas and others as they play off Australia, the United States and British Columbia against one another?

The “F” word

I hate to raise this but there is an elephant in the room that no one seems to want to acknowledge. It is called fracking – the controversial method of gas extraction that would supply the feedstock for BC LNG.

We have embarked upon fracking in British Columbia as an accepted policy with a minimal amount of investigation. Industry and the government choose to ignore that it is an extremely dangerous practice under the best of circumstances and that the damage done and the costs incurred vastly outweigh any of the benefits to be derived. As we read about government negotiations, the word fracking never seems to appear.

Such as we know them, the facts of the Christy Clark LNG policy would indicate that the government are, at best, bumblers in a game where the other side is used to winning and has all latest tricks up its sleeve.

In other words, in the government of British Columbia, the premier and her ministers are in this huge and complicated business way over their heads.



About Rafe Mair

Rafe Mair, LL.B, LL.D (Hon) a B.C. MLA 1975 to 1981, was Minister of Environment from late 1978 through 1979. In 1981 he left politics for Talk Radio becoming recognized as one of B.C.'s pre-eminent journalists. An avid fly fisherman, he took a special interest in Atlantic salmon farms and private power projects as environmental calamities and became a powerful voice in opposition to them. Rafe is the co-founder of The Common Sense Canadian and writes a regular blog at rafeonline.com.

11 thoughts on “Rafe: Clark govt in over its head with big LNG players like Petronas

    1. Well since the supreme court decision it seems like its every band
      for themselves. Can you say divide and conquer? If I was a conspiracy nut I could almost believe the courts did this on purpose. Good thing im a sheeple
      that cant see beyond my nose.

  1. Fracking must be stopped. Fracking endangers groundwater, pollutes it with crud which might never be removed or remediated. Water will be much more important and valuable than LNG. There is plenty of LNG in the world, but there has never been too much fresh drinking water. Entire civilizations have collapsed when their drinking water sources disappeared. So far we’re doing fine without LNG.
    I don’t know why the NDP as good as threw away the last election; maybe they didn’t want to be blamed for the financial collapse which is teetering over our heads and due to come down on us at any time. I don’t know. What I do know is this LNG furor is a pipe dream. Our provincial “negotiators” are totally outclassed and it is only hubris has them still pretending they can actually deal with the slick international experts. Anything which involves any degree of fracking should be stopped immediately. Protect our water!

  2. This current rendition of snake oil sales men (Coleman, DeJong, Lake and others) and women, (Clark,Polak,Anton et alia) deserve the same fate as their quackery forbears of another century, who, when their charlatanry was realized and exposed, were dutifully tarred and feathered and road out of town on a rail.

    Hopefully the present crew will be sent to Ferndale or Matsqui on a BC rail.

  3. Wait a minute, you mean LNG export ISN’T going to clean the air, make us all rich, and pay off BC’s debt???

  4. Rafe, I think people want to be lied to. They want to believe. What is the point of spreading hopelessness to the population when they can’t even handle day to day challenges? A good lie works every time…..and I don’t expect it to change any time soon. Politician will still lie their face off to get elected and the voter will fall for it. The game is who is better at it. Christy is the best liar I have witness in a long time.

  5. Another good column from Rafe Mair re: what will go down in history as the worst government this province has had the misfortune to experience. The list of countries, regions, counties and towns across the world that have banned the use of fracking grows longer with every day. The damage cannot be mitigated. In the US a family already was able to win a 3M$ lawsuit as a result of provable damage to the families health and the damage to their lands. The time will come soon I hope when the individual voters wake up to the snake oil they were sold in the last election. Then Premier Clark and Minister Rich Coleman may learn that in our damaged democracy the public still has more votes than the corporations with power and money. I live in that hope.

  6. Funny. I never know how to react to the word “fracking”. In Battleship Galactic fracking was a polite term for fuck. ( Fornication Under Consent of the King). However what this project will do to BC and the ENVIRONMENT is unbelievable ! So, sadly, fracking is an appropriate term. We will be fracked, by our own government.
    However I do love the wake up call to voters. Hope it is not too late.

  7. Thank you for bringing up the F word. I am disappointed each time I hear anyone in opposition use LNG. Like you said call it what it is. “Mr. Speaker, I would like to know how the Honorable Minister of Mines is progressing on his fracking plans for BC? Further, please let us know how he will insure that fracking will be safer here than anywhere else on the planet, Keeping BC the ‘best place on earth”?

    Thanks again for the article.

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