LNG glut dims outlook for new plants

Coleman confident B.C. will be competitive despite low prices, challenges flagged in natural gas forecast

A new forecast of global natural gas demand paints a gloomier picture of the prospects for the launch of a major new LNG industry in B.C.

A new report suggests the odds are getting longer for the B.C. government’s dream of opening several liquefied natural gas export plants.

The International Energy Agency warned a flood of new LNG supply is coming onto the market and new plants will struggle to get off the ground.

“Several projects have already been scrapped or postponed, and the number of casualties will rise if prices do not recover,” said the IEA’s medium-term gas market report.

The IEA cut its LNG growth forecast from 2.3 to 2.0 per cent a year.

It noted the 17 new LNG projects already under construction will come on stream as planned and run flat out in an attempt to recover as much of their sunk costs as possible, further adding to the supply glut.

But new plants that aren’t yet approved will become harder to justify.

“Today LNG prices simply do not cover the capital costs of new plants.”

Natural Gas Development Minister Rich Coleman said he’s aware of the short-term challenges outlined in the report.

The province last month signed a long-term agreement with LNG proponent Pacific Northwest LNG assuring the $36-billion Petronas-led project of royalty and tax stability in B.C.

“Clearly some of the largest companies in the world see the value in building a LNG industry in B.C.,” Coleman said in a statement emailed by his office.

“The fact is, LNG projects have lifespans of 30-50 years. So proponents are looking at the long-term economics when deciding the viability of a project . Many analysts are forecasting that B.C. LNG will be competitive over the long-term. We share that view.”

Just Posted

Bill passes to make Sept. 30 National Day for Truth and Reconciliation statutory holiday

Residential school survivor Phyllis Webstad and CRD Area F director Joan Sorley were in Ottawa for the vote

Wally Webber elected to fourth term as Nuxalk Chief Councilor

Webber took the win with 174 votes out of a total of 389

Bella Coola expected to be hottest spot in B.C. today

Temperatures are predicted to rise to 18 C

B.C. minister says rural internet is ‘railroad of the 21st century’

Jinny Sims talks details about the $50-million provincial and possible $750-million federal funds

IT’S OFFICIAL: Mt. Timothy sale complete

New owners looking toward year-round mountain resort facility

VIDEO: Restaurant robots are already in Canada

Robo Sushi in Toronto has waist-high robots that guide patrons to empty seats

Permit rejected to bring two cheetahs to B.C.

Earl Pfeifer owns two cheetahs, one of which escaped in December 2015

Real-life tsunami threat in Port Alberni prompts evacuation updates

UBC study says some people didn’t recognize the emergency signal

Care providers call for B.C. seniors’ watchdog to step down

The association also asks the province to conduct an audit and review of the mandate of her office

Nitro Cold Brew Coffee from B.C. roaster recalled due to botulism scare

“If you purchased N7 Nitro Cold Brew Coffee from Cherry Hill … do not drink it.”

B.C. man gets award for thwarting theft, sexual assault – all in 10 minutes

Karl Dey helped the VPD take down a violent sex offender

Nowhere to grieve: How homeless people deal with loss during the opioid crisis

Abbotsford homeless advocate says grief has distinct challenges for those living on the streets

ICBC shifts to Alberta model, with higher rates, private insurers say

B.C. public insurance includes funding enforcement, driver licensing

Most Read