B.C. conference hears First Nations consultation a must for LNG proponents

A natural gas refuelling port is seen on a vehicle at the Vancouver Board of Trade energy forum on Wednesday, Oct. 8, 2014. (Darryl Dyck / THE CANADIAN PRESS)

VANCOUVER -- Aboriginal consultation must be the top priority for liquefied natural gas proponents in Canada, say a company and First Nation that have partnered to build a LNG facility on Vancouver Island.

Steelhead LNG president Victor Ojeda and Malahat Nation CEO Renee Racette spoke to the Canada LNG Export conference in Vancouver on Wednesday about minimizing the risk of costly delays through collaboration.

Ojeda told a crowd of engineers and businesspeople that the company began consulting with the Malahat well before entering the regulatory process or advanced design phase.

"Frankly, I don't know why it would make business sense to do it later, when you've invested a lot more," he said. "(Early consultation) makes business sense from our perspective and it's the right thing to do."

The pair made the comments as LNG proponents in British Columbia try to coax often fiercely-opposed First Nations to consider the economic promises of such projects.

Pacific NorthWest LNG, for example, recently won conditional support from the Lax Kw'alaams First Nation after a long battle that saw the community initially reject a $1.14 billion-benefit deal.

There are 19 LNG proposals in B.C., but even those that have First Nations support still face serious challenges including weakened Asian demand and slumping energy prices.

Steelhead LNG and the Malahat announced a mutual benefits agreement and long-term lease last summer to develop Malahat LNG, which would include floating liquefaction facilities in Saanich Inlet off Bamberton, about 40 kilometres north of Victoria.

The Malahat bought the 5.25-square kilometre Bamberton site in July 2015, in what Racette called "one of the largest aboriginal land purchases in Canadian history."

The facility would be capable of producing six million tonnes of LNG a year and would be fuelled by a 128-kilometre pipeline. A final investment decision from Steelhead LNG is expected in 2018 with production to begin in 2022.

Racette told the audience that indigenous people are the poorest people in Canada and need to build their local economies.

"When you travel through much of B.C., you know when it's reserve land, and you know when it's not reserve land," she said. "You can see that on the Island, the huge disparity of wealth and poverty. It's not justifiable and it's not OK anymore."

She said the Malahat is already addressing its extreme unemployment by working aggressively with Steelhead LNG. The project is expected to create 30 years of revenue and 150 full-time jobs.

However, Racette acknowledged in an interview after her speech that neighbouring aboriginal groups staunchly oppose the project.

Four First Nations, collectively known as the WSANEC, have vowed protests and court action if the LNG facility moves ahead. The nations did not respond to requests for comment on Wednesday.

Racette said the Malahat is working to ease the concerns of its neighbours through dialogue.

"There's a lot of fear out there that we're going to have to address and there's a lot of poor information," she said. "But we're trying to work through it together. That's something that Steelhead is also looking to us to lead on."

Jennifer Siddon, a Woodfibre LNG spokeswoman, also spoke at the conference. The Squamish Nation has granted its own legally-binding environmental certificate for the Woodfibre LNG project on Howe Sound, 60 kilometres north of Vancouver.

"The main thing we can't underscore enough is to start the conversation early," she said. "Don't make the assumption that it's a 'No' because it's a resource project."

Also on Wednesday, the Simpcw First Nation in B.C.'s Southern Interior announced a mutual benefits agreement signalling its support for the Trans Mountain pipeline expansion.

Chief Nathan Matthew said in a statement that the Simpcw will play an "active role" in all aspects of the project within its territory, including environmental stewardship and economic benefits.