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special report: canada an ‘awakening giant’ in lng FEBRUARY & MARCH 2014

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PIPELINE NEWS NORTH VOL. 6 ISSUE 2 DIST: 16,000

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alpha and patch driving safety in north b.c.

from the oilpatch to the roads, alpha training solutions is driving safety for today’s workforce, and preparing for tomorrow’s Wayne McMann, a veteran of the oilfield, offers driving classes at Alpha Training Solutions via his company, The Patch Driver Development, through a training partnership between the two businesses. The focus of his popular class is on pickup driving. “Defensive driving saves lives,” he said. Matt Lamers photo

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11th Annual Fort St. John Oilmen’s 4 On 4 Hockey Tournament April 2, 3, 4, 5, 2014 Entries Limited to the first 110 oilfield personnel registered for draft. Locals must be paid members of The Oilmen’s Association. All teams are drafted from individual paid entries. Teams will be drafted Registration night. All Games at the North Peace Rec. Center. Entries must be postmarked Feb 1st, 2nd, or 3rd 2014. No Entries will be accepted prior to these dates and all entries after these dates will be viewed as late. Entry fee $200.00 / player. All fees payable to Fort St. John Oilmen’s Hockey Tournament. Tournament includes 5 games, door prizes, 3 breakfasts, and 1 stag ticket.

Name: ___________________________________________________ Company: ___________________________________________ Age: ________ Phone#_____________________________ Hockey position: (G) _____ (D) _____ (F) _____ Address: _____________________________________ City/Town: _________________________________ Postal Code: _________ Email address:_________________________________________________________________________________________________ When was the last time you played organized hockey? (Example: Senior, Junior or Rep Hockey) Level_____________________ Year___________________ Consent and Waiver Agreement I do hereby consent to participate in the annual Fort St John Oilmen’s Hockey Tournament. I duly recognize the risks inherent with participation in this tournament specifically referring to, but not limited to the risk of personal injury, and do hereby waive any and all claims against this tournament or it’s executive, both jointly or severally for any loss, damage, or injury I may sustain through participation in this tournament. The foregoing is applicable to and binds all my heirs, successors, and assigns, and as evidenced by my signature hereto, this consent and waiver agreement has been entered into freely of my own will and for my own benefit. Date: ________________________________ Signature: _______________________________________________________________ Please forward entries to: C/O FSJ Oilmen’s Hockey Association Box 6122 - Fort St John, BC - V1J 4H6 No Refunds After Cancellation Deadline Midnight March 23rd 2014. Please Register Wednesday night upstairs at the curling rink between 6:00 pm and 8:00 pm Direct entry inquiries and cancellations to Trevor Gould at 250-261-8399

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PNN

NUMBERS

Matt lamers Photo

The following figures were taken from the stories in this issue of Pipeline News North.

93, 69: The price for one litre of propane in cents, now and in 2011, respectively. Chart on Page 5 $4, $2: The price of natural gas in January 2014 and two years ago, respectively. Chart on Page 5 36,000: The number of people who have received training from Alpha since 2007. Story on Page 7 $87.7 million: The price Storm Resources paid on Jan. 23 to acquire Montney Formation acreage from Yoho Resources. Story on Page 8 Jan. 13: The date that the proposed Kitimat LNG site at Bish Cove took a significant step forward by awarding a contract for the construction services, engineering and procurement of the new LNG plant. Story on Page 8 200: The number of people who have taken Wayne McMann’s Defensive driving and air brakes safety classes. Story on Page 10 $165,000: The cost for one copy of “the North Montney Shale Gas Growth” report, a.k.a.the “Bible of engineering.” Story on Page 13

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10: The number of immigrants who recently took part in the development of a hiring application. Story on Page 14 February: When the the Hiring Assessment Tool Kit team will be ironing out the process, with an eye on an end-March rollout. Story on Page 14 $370,000: The application fee for the newly introduced Class C pipeline classification, plus $1,400 per kilometre. Story on Page 18 10 per cent: The stake that state-owned Indian Oil Corporation is reportedly considering scooping up in Pacific Northwest LNG. Story on Page 19 12 million: The capacity that China Huadian Corporation’s new LNG receiving terminal in Hainan Province will be able to handle per year once completed. Story on Page 19 20 years: How long Fort McKay First Nation has been working with petroleum companies to develop oilsands responsibly. Story on Page 20 400: Those who attended the Energy and the Oil Sands, Aboriginal Perspectives conference

in Alberta. Story on Page 20 3: The number of conferences that have been held so far for First Nations in B.C. to talk about the potential risks and benefits of LNG development. Story on Page 21 8: The number of sailing days that shipping companies save by transporting goods to Asia from Western Canada, compared to American ports. Story on Page 22 $14.66/GJ, $4/GJ: The average cost of LNG in Japan and North America, respectively. Story on Page 22 560: The number of wells that the Petroleum Services Association of Canada expects to be drilled in British Columbia this year. Story on Page 24 57%, 51%: The support Canada’s two largest pipeline proposals - Energy East and Northern Gateway enjoy, respectively. Story on Page 26. $1,300, $1,900: The average weekly wage in Alberta a decade ago and today, respectively. Story on Page 29

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Matt Lamers photo

pipeline news north 20 First Nation has message for B.C.

What the 5 charts say

Train makers 5 to study LNG ‘SAFETY IS LIFE’ 6 Changing attitudes

Storm ups stake: 8 in Montney

21 LNG summit ‘to turn the debate’

Charles Cook photo

Canada an 13 ‘awakening giant’ in LNG

Levies raised 18 for pipelines, plants India considers 19 buying B.C. LNG

23 Act quick on LNG, says ex-Liberal leader 24 Drilling forecast to rise in B.C.

Matt Preprost photo

26 Fixing a breakdown in communication 29 LNG boom will spur wage growth 31 Most of B.C. supports Trans Mountain

jobs

Another Chinese 19 firm wants in

22 Spectra updates FSJ council

25 Can LNG go green?

A human touch 14 to hiring

For LNG, ‘the sooner the better’

community

Kitimat LNG issues 8 construction contract

Pipelines

the charts

SAm beebe photo Published monthly by Glacier Ventures International Corp. Pipeline News North is politically independent and a member of the B.C. Press Council. The Pipeline News North retains sole copyright of advertising, news stories and photography produced by staff. Reproduction is prohibited without written consent of the editor.

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natural gas prices, henry hub

April 2012 through January 2014

Low temperatures continued to boost the prices of natural gas in North America this winter. January’s average was over $4 for the first time in three years. Source: U.S. Energy Info. Administration

oil & gas land auction in b.c.

September 2013 through January 2014

The upward trend has continued since a report more than doubled the amount of gas estimated to be locked in the Montney Formation. In Jan., B.C. netted $7.46 million. Source: B.C. Oil & Gas Commission

marketable gas production in british columbia B.C. production of gas declined slightly, but remained near a record of 107,850 103m3/d in September. Source: National Energy Board. Figures are latest available. January 2013 through September 2013

Train makers to study LNG Matt Lamers Staff Writer

LNG-powered trains aren’t the farfetched idea they once were. Canadian National and some American railroads plan to test natural gas prototypes this year that have been developed by locomotive manufacturers GE and Caterpillar. They came up with the idea nearly 30 years ago, but unstable and expensive natural gas prices made the project uneconomic. With gas prices near record lows, this time may be different. Assuming the tests go as planned, the locomotive industry could be in store for the biggest changes in a century. Even if the engine problems are overcome by the railroads, signifi-

cant hurdles remain. A massive investment would be required to retrofit trains and construct LNG refueling stations around the continent. North America currently lacks liquefaction plants to service the locomotive industry and most of the liquefaction plants that have been proposed are for export purposes only. Railroads aren’t the only ones interested in natural gas. The trucking industry has long eyed LNG to power its fleets, recognizing the same fuel cost savings, but it faces similar challenges to trains: A lack of liquefaction, expensive refueling infrastructure and the high cost of retrofitting thousands of trucks with new engines.

d e t a l u Ins ibs B & s a k r a P

auto propane retail price in canada

wells drilled in b.c. annually The number of wells drilled in British Columbia peaked in 2010 at 710. By 2013, that number had fallen to 567. It’s expected to rebound slightly this year. Source: The B.C. Oil & Gas Commission.

19995

BC CUSTOMERS SAVE PST EVERYDAY

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January 2011 through February 2014

The average price of propane in Canada has rebounded sharply from an all-time low of 69 cents per litre in Sept. 2011 to a record 93 cents in Feb. 2014. Source: Natural Resources Canada

Annual 2009 through 2013

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SAFETY SPECIAL

‘SAFETY IS LIFE’ The region’s largest private safety training company is preparing to meet the demand in northern British Columbia Matt Lamers On a recent afternoon at Alpha Training’s school in Fort St. John, Nicholas Stafford and about two dozen of his peers gathered in a classroom for a one-day course on H2S. Some were taking the class for the first time, while others, like Stafford, were there to renew their certificate, which the government mandates must be done every three years. Stafford, however, thinks being safe means more than following government regulations. “I like to come home to my family every day, that’s why it’s important,” said the 23-year-old, 12-year resident of Fort St. John. “I’m renewing my H2S today, and so far I have learned a lot because they’ve updated the course.” Safety is the heart of Alpha Training Solutions. Everyone working in the oilpatch is required to have certain certificates, or “tickets” as they’re called, and no one turns out more students in Northern British Columbia than they do. Alpha is amongst a select number of institutions that offer safety training in the area, including St. John’s Ambulance and Northern Lights College, but it is the only one that doesn’t get assistance from the government. George Katona, Alpha’s general manager, said Alpha is expanding as fast as it is because of its reputation. “We’ve been around for about 15 years. Everybody knows us,” he said. “A lot of people go through here and they’re happy with the quality of service that we provide. Our founder’s mission is to be a positive influence in the marketplace. So we do what we say and say what we do.” Alpha was founded by David and Judy Phibbs in 1997. David is currently CEO. Alpha Training’s most popular courses are H2S and Level 1 first aid, but they offer a bevy of others, such as confined space and defensive driving. All of Alpha Training’s tickets are one-day courses except Level 3 first aid, which is two weeks. “H2S is by far the most popular ticket because it’s required for anyone who wants to work in the oilpatch,” said Katona. H2S is a deadly gas. It’s an important ticket for workers to get so “they know what they’re up against in the patch. It can kill them. They learn how to avoid it. What to do if someone goes down, how to save themselves and others if something happens.” Since 2007, about 36,000 people have been trained by Alpha. Business has doubled over that timeframe. Martin Weiderman, training manager for Alpha, said their growth boils down to an expanding industry, a rising awareness of safety and liability concerns for employers. See SAFETY on PAGE 10

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Matt Lamers photo

Storm ups stake in Montney

Kitimat LNG issues construction contract

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The proposed Kitimat LNG site at Bish Cove took a significant step forward on Jan. 13 when Chevron/Apache awarded a contract to JGC/Fluor for the construction services, engineering and procurement of the new plant. The province took it as a positive step, saying that it’s a “strong sign” that the LNG project is on the right track. Kitimat LNG is a joint venture between Apache Canada and Chevron Canada. They are expected to make their final investment decision sometime in the next year. “Today’s news is another strong sign of LNG projects advancing in British Columbia, which means another step towards realizing an unprecedented opportunity to create jobs and stronger communities throughout British Columbia,” said Premier Christy Clark. “There are already 400 people supporting their families by working on the proposed Kitimat LNG facility site, one that has the potential to benefit all British Columbians.” Of the dozen LNG projects that have been proposed, Kitimat LNG is in a more advanced stage of development. It would be fed by a 463 km, 36-inch pipeline, which already completed its Environmental Assessment and received the green light from provincial authorities in 2008. The pipeline would be built by Pacific Trail Pipelines Limited Partnership and cost about $1.2 billion. Kitimat LNG was granted a 20-year export permit by the NEB in October 2011. The natural gas would come from the 644,000 undeveloped acres in the Horn River and Liard basins that Chevron Canada and Apache Canada have jointly invested in, according to regulatory filings. r002698072

Storm Resources Ltd. announced on Jan. 23 that it had purchased Montney Formation acreage from Yoho Resources Ltd. for $87.7 million. The land is in the Umbach-Nig area of Northeast British Columbia and contains two horizontal wells that produce 359 BOE per day. The Umbach-Nig Creek area is about 80 kilometres north of Fort St. John. The deal involves a 100 per cent working interest in 29 sections of undeveloped land. The acquisition, which was scheduled to close on Jan. 31, brought Storm’s Montney land holdings in the Umbach-Nig Creek area to 98,000 acres. The company said production rates from its previous 10 horizontal wells have improved by 50 per cent to 60 per cent from earlier horizontal wells.

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SAFETY from PAGE 6 “Demand is only going to grow for safety consciousness,” said the native of South Africa. “What we’ve discussed is how to get people to go from behavior-based safety to belief-based safety, so they understand the value in it for themselves, it’s not something that’s about rules. We have to change people’s thinking.” Alpha Training Solutions has been able to keep up with industry growth in the last 10 years. But that could be a drop in the bucket compared to what is in store for Northern B.C. in the coming decade. Eight pipelines are in the works, along with about 20 natural gas export projects of all sizes. Even if only two of the mega-projects move forward, which is about what analysts speculate will happen, 100,000 workers will be needed to build and operate the natural gas production centres, the pipelines and the liquefaction plants. If the massive Site C dam is built near Fort St. John, another 30,000 people will be needed. All the workers will need safety certificates. Alpha Training Solutions has a plan to tap into this massive market. Over the years, they’ve taken their courses on the road. But in the years ahead, they hope to greatly expand their mobile class offerings. In January they travelled to Blueberry River First Nations to offer training in first aid, and industrial and outdoor courses. Over the two week period, about 120 “seats” were offered. “With the LNG development and the pipelines

going that way, it’s going to be a big opportunity for us, because First Nations people would obviously want to be involved with that opportunity for employment,” said Weiderman. “They’re going to need tickets to be employable.” They have also offered courses for Bellacoola First Nation, a coastal community of about 2,000 people, and plan to return later this year. Alpha will offer on-site training for communities between Prince George and Prince Rupert both this year and next. The idea, said Weideman, is to keep costs low for both the students and the company by servicing as many places

fields. We’re happy to work here in Canada because there is a very high level of safety,” said the 49 year-old. The focus of the school’s defensive driving training is on pickup trucks. “Safety is important for us, our health and the environment. Safety is life,” he added. That’s a common theme through the classes. “Everybody wants their employees to come home in one piece,” said Katona. “When someone is lost it’s a big deal, so we try to provide training so they know what to do in case something happens.” Most of the tickets that are required to work in the oilpatch must be renewed every three years. “People are industry’s most valuable asset,” Weiderman said. “If you look after them, and they have the sense that you truly care about them, then they’re probably going to care about your business. They’re not just robotic machines. Even in our business here, the more you take care of people, the more they take care of you.” The school also offers courses in defensive driving. Wayne McMann, a veteran of the oilfield, offers driving classes at Alpha Training Solutions through his company, The Patch, Driver Development, through a training partnership

‘Defensive driving will save your life. Literally,” he said. “There’s no question about that.’ — Wayne McMann as possible between Prince George and Prince Rupert. “We want to take the training to those locations. We might look at a satellite campus in Prince Rupert or Kitimat,” he added. ‘Defensive driving will save your life’ George Onikashvili, from Vancouver, via Georgia, was in Stafford’s class in February. “It’s very important to have this class because it’s dangerous to work in the oilfields and gas-

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SAFETY SPECIAL

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rience. If you want to use the simulator, we can expose you to things that you wouldn’t see for two or three years,” he said. About 200 people have benefited from the two classes. McMann, also based in Fort St. John, has been working with Alpha Training Solutions for just over a year. “It’s been good for both of us. It fills in the training holes for the two of us,” he said. “With one phone call, we can start somebody completely rookie, totally brand new, and turn them out with all the tickets and all the training they need to go out and work in the patch, including Class 1 driving.” It would take about a month to earn all the tickets they offer.

“I’m a darn good instructor. It matters to me that people learn what they need to know. “I know that when my drivers go out, that they’re going to be much safer, much more effective drivers. My highest rating for a driver is one that is both safe and effective. That really is what our training is all about.”

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between the businesses. He offers classroom courses from defensive driving to fuel-economy driving, as well as safe driving in adverse conditions and anything from “learners to Class 1.” “Defensive driving will save your life. Literally,” he said. “There’s no question about that. Good driver training makes the difference between a merely competent driver and a good driver or even a great driver. Driver training is essential.” Defensive driving and air brakes are the most popular tickets he offers. “We’ll give you the tools and the driver training for you to go out and get the hardcore expe-

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Canada an

‘awakening giant’

in LNG

Matt Lamers photo

Matt Lamers Staff Writer

Bill Gwozd doesn’t think “some” of the Montney shale projects will go forward like most analysts, Ziff Energy’s senior vice president thinks all of them will. Ziff Energy is the lead consultant for most of the LNG projects in Western Canada, providing infrastructure, supply and demand outlooks 25 years into the future. “These projects all have legs and all have rationale as to why they could all go. At the end of the day, each project has its own merits,” he said. “I think they’re on the right track.” Natural gas is being billed as the driver of British Columbia’s economic growth for decades to come. Provincial authorities claim that developing the resource will help free B.C. of debt within two decades and add up to a trillion dollars to its GDP in the long run. Still, challenges lay ahead. No major proponent has made a final investment decision, and the proposed pipelines face considerable opposition from environmentalists and some First Nations. Nevertheless, Gwozd is optimistic. “Each of the individual propo-

nents that have a plan for their LNG facility have individual reasons why their facility should proceed, so I’m not of the camp that some may not proceed and some will go. I’m of the camp that they will all proceed.” What the projects in Western Canada, particularly those in the Montney formation have going for them, Gwozd said, is that many have “push” and “pull.” “Pull” is when a foreign proponent seeks a natural resource overseas. In this case, petroleum corporations from Korea, China, Japan and Malaysia are active in Western Canada’s shale gas plays. “Push” is when domestic producers seek buyers for their resource. “In many of these cases, the supply is being pulled into their country because they want the natural gas,” said Gwozd. “Producers are pushing it, and [foreign companies] are pulling it, so we have a push-pull arrangement, which is a match made in heaven.” Canada’s geography also makes it a natural match to meet Asia’s needs. “There’s a lot of natural reasons why Canada will emerge as the awakening giant to supply a lot of opportunities to Asia. Today in Asia, LNG demand is 25-35 billion cubic feet of gas [per day], but by 2020,

LNG demand could be 40-60 BCFs per day,” Gwozd said. “You’re going to have greater demand for LNG, therefor you need more LNG demand to be distributed. And that’s only by 2020. These projects are going to go for a long time. As other countries are going to grow their economies, they’re going to need more energy.” A ‘Bible’ for Montney shale It’s sometimes called the “Bible of engineering,” but this book isn’t free. Released in early December, the North Montney Shale Gas Growth report hasn’t struggled to find buyers, despite its staggering price tag of $165,000 per copy. That’s because it’s essential reading for the big players in B.C.’s natural gas sector. So far the report has been delivered to AltaGas, Apache, Chevron, Enbridge, Shell and Veresen since its release. The authors, Ziff Energy and Gas Processing Management Inc., say more will surely be booked. “We forecast the future,” Gwozd told Pipeline News North. “It’s an engineering Bible at your fingertips.” About 10 months in the works, the 202-page North Montney Shale Gas Growth study identifies locations where new infrastructure is required to produce natural gas, the scale of

the infrastructure, the year it would be required and the type, whether it be sweet, sour, or liquid processing. Infrastructure under the microscope includes pipelines, gathering systems and processing plants. The report maps out, by year, 25 specific, actionable recommendations. “We go through each one and identify the locations of new facilities, whether its pipe, processing facilities, the costs, and what the benefits are going to be,” said Gwozd. “Each of the actionable recommendations has a capital savings, a product acceleration savings and an operating expense savings.” This is the fourth report of its kind by Ziff Energy and Gas Processing Management Inc. The first, titled Montney Growth, was delivered to 18 participants in 2012. Tight Gas & Northern Duvernay Growth had 16 participants in 2012 and its Southern Duvernay version had nine participants in 2013. The next two reports, Natural GasWest and NGL-East, promise to help resize B.C.’s proposed pipelines and solve the problem of infrastructure bottlenecks. They’re scheduled to be released in July and December. “We put it on a silver platter and that’s why we have 50 subscribers. It’s a business plan come true.”

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KERRI-JO Photo

a human touch to hiring Matt Lamers Staff Writer

For immigrants like Narcisco Ocho, the biggest challenge to succeeding in Canada is being given an opportunity to use his skills. Ochoa was one of 10 newcomers to British Columbia who recently took part in the development of a hiring application that will help connect qualified immigrants with prospective employment opportunities in Northern British Columbia’s oilpatch. “The program will help in two ways,” said Ocho. “It will open new doors for us. Alone, I don’t think we would have a chance to meet the right people in the industry. Second, the program is good for new immigrants like me because it doesn’t only assess us on our skills, but it’s also like an assessment of myself, on which of my skills I can use in Canada so I can know which jobs I would be eligible for.” Spearheaded by Sandy Steward, it’s known as the Hiring Assessment Tool Kit. It’s being led by Northern Lights College and funding comes from the Employer Innovation Fund,

contact Art Jarvis, Executive Director for contact information see www.energyservicesbc.org R001668780

R001697752

For information on Membership

Immigrant Employment Council of B.C. Beyond connecting immigrants with prospective employers, the the tool kit will help energy companies alleviate one of the biggest challenges of doing business in Northern British Columbia: filling their ranks with qualified and skilled workers. Ochoa, an electrical engineer from the Philippines, has been a permanent resident here for two years. He said that when the hiring program is ready, it will benefit everyone involved. Ultimately, the Hiring Assessment Tool Kit goes beyond assessing a person’s credentials to focusing on what a candidate can actually do. “Where the tool showed its strength was because the focus is on the conversation, the assessors were able to figure out whether they would fit into the job,” said Steward, project manager and lead consultant. “But they were also able to see where they could fit within the industry, and point them in that direction.” Ochoa and his nine peers took part in its development from the third week of December to the second week of January at the Empire Landmark Hotel and Immigrant Services Society of B.C. in Vancouver. The nine-member Hiring Assessment Tool Kit team has until the end of March to get the hiring tool ready for industry use. Key partners in the project are employers such as Shell, Esso and Encana. There are currently about a dozen major natural gas production and export plans in the works in Northern B.C. If only two of them go forward, the province will be in quick need of tens of thousands of workers to construct and operate natural gas production facilities, pipelines, liquefaction plans and export terminals. Labour is seen as one of the biggest

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employment KERRI-JO Photo

“It’s not just anybody who can do this,” said Steward. “The assessor is essentially an expert in the job that you’re hiring for. So if you’re hiring a gas plant operator, you want to have a gas plant operator that you train and they conduct the assessment. This assessment is really a conversation between two people who know how to do the job. “The assessor will be able to determine how well they did it [in the past],” she added. “It’s much more focused on a specific job than a standard interview with general questions. It’s more relaxed. The assessor is trained to ask a series of specific questions designed to talk about the experiences that the job applicant has actually had in working that are relevant to the tasks done at the jobs.” See JOBS on PAGE 28

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challenges to developing British Columbia’s natural gas industry. Steward, a consultant in the area of workforce development, worked with the B.C. Natural Gas Workforce Strategy Committee from 2012, concluding that British Columbia will need more than 75,000 permanent skilled workers for the province’s LNG projects. An additional 60,000 workers will be needed for construction in 2016 and 2017, the taskforce concluded. “There was a common theme to all of the issues the committee identified for the planned investment in the North through 2020,” said Steward. “They revolved around workforce development in terms of having enough workers, addressing the skills issues of current workers. Northern Lights College has the opportunity with the Employer Innovation Fund and it gave us the opportunity to implement a couple of the recommendations.” Steward hopes that by incorporating “relationships” into the candidate evaluation process, the tool will more effectively connect candidates with the employers, large and small. “The objective of the project is to help employers hire new Canadians. Employers in natural gas and mining don’t necessarily have the tools to accurately assess whether these people can do the jobs they want them to do,” she said. “It’s a common language so employers and job seekers can talk to each other.” The Hiring Assessment Tool Kit also aims to address the fact that many entry-level energy jobs in Northern B.C. do not have clear definitions or job descriptions. This is how it works: The assessment does not look at technical competencies of candidates, but rather it measures their “general competencies,” and those are things like adaptability, ability to work within a team, resilience, plus an understanding and willingness to relocate to the North. The team selected some tests to get that information. A three-hour, occupationspecific essential skills test was developed, as was a language proficiency particular to certain jobs. Next, psychometric tests were used to determine if a person would be a safety liability. “It’s a comprehensive tool that gives you a fair amount of information about the individual, including identifying areas where you can direct training,” said Steward. Labour retention is big issue in the North, so assessing whether a person could stick it out at a job is a key part of the assessment. There are a couple ways the Hiring Assessment Tool Kit could be implemented after it’s completed next month. One is that the Northern Lights College could provide candidate assessment as a service for employers who don’t have adequate human resources capabilities. The centre could have people to do these kinds of assessments for them, since the Hiring Assessment Tool Kit requires that those doing the assessments are specially trained.

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g Fever Super Sale in Dawson Creek

at Foster’s • 920 Adams Road

its unted

up to

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starting at ekly on new 0 down oac

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March 6th - 9th at encana events centre 1-300 Highway 2, Dawson Creek, BC

Thursday/Friday: 10am-9pm Saturday: 9am-9pm • Sunday: 10am-5pm

Creek, BC • Across from Co-op Cardlock • Tel: 250-782-2722

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Levies raised for pipelines, plants Matt Lamers Staff Writer

Thorlakson Management Ltd. Steve Thorlakson cfp Project Manager 10403 109 Ave. Fort St. John, BC V1J 2S2 250-787-5898 sthorlakson@gmail.com

$350,000 post-design. The permit application fee for a small plant, one producing less than 1.4 106 m3 /day, was slashed from $50,000 to $25,000. The cost for a first-time applicant to obtain a permit to drill or operate a well will fall from $18,700 to $12,400. This year’s Fee, Levy and Security Regulation introduced a new classification of pipeline, called Class C. The cost for a proponent to obtain a permit for a Class C pipeline less than 50 kilometres in length is $2,000 plus $1,400 per kilometre, but that rises significantly for pipelines more than 50 kilometres long, which will cost $370,000 plus $1,400 per kilometre. The changes went into effect on Feb. 6. “The Fee, Levy and Security Regulation accommodate the increase time and staff are required to thoroughly and responsibly review all applications the BC Oil and Gas Commission receives,” said Friedrich. “These changes were reviewed by the commission, industry and the provincial government.” As a result of the enactment of the Oil and Gas Road Regulation, the commission will be issuing permits for oil and gas resource roads. Winter access roads in excess of five kilometres will face permit application fees of $100/km. All season access roads longer than five kilometres will cost proponents $200/km to obtain a permit. Both permits previously had no charge. Major amendment applications will cost $500. The update to the Fee, Levy and Security Regulation comes ahead of an expected rise in drilling this year. There is also in excess of 20 proposed projects to export B.C.’s natural gas to markets in Asia, although analysts expect a small number of those to eventually move forward. R001716299

It’s going to cost more to obtain permits to build new pipelines, wells and resource roads in British Columbia in the coming years. In February, the B.C. Oil and Gas Commission updated its Fee, Levy and Security Regulation regime for the first time since Aug. 1, 2012. The Commission, a provincial entity, uses revenue from the fees to meet its regulatory obligations and recover expenses. Some of the increased revenue will be used for the Science and Community Environmental Knowledge Fund. The SCEK is used to fund initiatives such as the Induced Seismicity Monitoring Project, which went live last March. It was initiated after the OGC’s 2012 report “Investigation of Observed Seismicity in the Horn River Basin” concluded that seismic activity was synchronous with hydraulic fracturing operations that had taken place between April 2009 and December 2011 in the Horn River Basin. “The increases to well permit application fees and production levies will increase funds and allow for new projects. Assessments are conducted on a regular basis to determine how the funds are used,” said Hardy Friedrich, communications manager. Friedrich said the commission routinely evaluates the fee schedule and addresses required updates as necessary. The permit application fee for a Class C LNG facility producing in excess of 5.634 106 m3 /day will rise from $100,000 to $650,000. A permit amendment fee, which had no charge previously, will now cost

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industry news ENVIRONMENT A bird’e eye view of Prince Rupert. The state-owned Indian Oil Corporation is reportedly considering a minority stake in Pacific Northwest LNG, which would be based in Prince Rupert if it receives an affirmative final investment decision. courtesy photo

India considers buying into B.C. gas Matt Lamers Staff Writer

British Columbia’s natural gas has drawn considerable interest from Japan, China, South Korea and Malaysia in recent years, as companies from Asia have raced to establish partnerships with Canadian gas producers. Add India to the list. The state-owned Indian Oil Corporation is reportedly considering a minority stake in Pacific Northwest LNG. The Indian Oil Corporation is the country’s largest refiner and distributor of fuel. The company is said to be in advanced talks for a 10 per cent stake in Progress Energy Resources Corporation, which is a part owner of

Pacific Northwest LNG. The stake is worth a reported $1 billion. Pacific Northwest LNG is a joint venture between Malaysia’s Petronas, Japan’s Japex and Petroleum Brunei. If it receives an affirmative final investment decision, it would be located on Lelu Island, Prince Rupert. Petronas sold a 3 per cent stake in Progress Energy’s natural gas assets to Petroleum Brunei, and the Indian Oil Corporation hopes to do something similar. Japan Petroleum Exploration Company, or Japex, acquired a 10 per cent stake in the project last April. On Dec. 16, Canada’s National Energy Board handed out export

Another Chinese firm wants in Matt Lamers Staff Writer

permits to Prince Rupert LNG Exports Limited, Pacific Northwest LNG, WCC LNG and Woodfibre LNG Export Pte. Ltd, respectively, bringing the number of approved LNG export permits to seven. The proponents were awarded permits to export about 73 million aggregate tonnes of LNG per year for 25 year terms. Pacific Northwest LNG would be fed natural gas by the Prince Rupert Gas Transmission Project, which is the largest of the gas pipelines that have been proposed in terms of diameter and length. The 900 km, 48 inch pipe would cut a path from a point near Hudson’s Hope, about 80 km from Fort St. John, to the proposed Pacific Northwest LNG facility on

China Huadian Corporation is considering an investment in one of British Columbia’s liquefied natural gas (LNG) projects, a Chinese newspaper reported last month. The paper, Want China Times, reported that China Huadian Corporation has been in contact with the Malaysian state-owned energy company Petronas about

the possibility of buying a stake in Pacific Northwest LNG. On Dec. 16, 2013, Pacific NorthWest LNG received permission from the National Energy Board to export 19.68 million tonnes of LNG per year. Pacific NorthWest LNG is jointly owned by Petronas, Japex and Petroleum Brunei. It will be located on Lelu Island, Prince Ru-

Lelu Island. Upstream, Progress will produce the gas in Northeast B.C. Progress Energy Canada Ltd. has already signed agreements with NOVA Gas Transmission Ltd. for approximately two billion cubic feet per day of firm gas transportation through its pipeline system, and in 2019 the proposed North Montney Mainline extension will connect to the proposed Prince Rupert Gas Transmission system, providing deliveries to the planned Pacific Northwest LNG terminal. Progress Energy Canada was acquired by Petronas in 2012. The pipeline’s capacity would be two billion cubic feet of gas a day, with the ability to expand to 3.6 billion cubic feet per day. pert, if it receives an affirmative investment decision. The report also noted that China Huadian Corporation has already invested in receiving terminals in Hainan Province, southern China, in anticipation of the country ramping up imports of LNG. It will be capable of handling 12 million tons per year of LNG.

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first nation has a message for b.c. Matt Lamers Staff Writer

For Fort McKay First Nation, it’s not a question of economic development or environmental protection, it’s an issue of balancing. For years, Fort McKay First Nation has been working with neighbouring petroleum companies to develop natural resources in a responsible, sustainable way. It’s a model the first nation says could be emulated in British Columbia, where First Nations stand to gain from the province’s burgeoning natural gas industry, but suffer more environmental losses if they’re not represented at the table. Dayle Hyde, communications director for Fort McKay First Nation, said that engaging the energy corporations has allowed the First Nation to control the pace of development and share in the wealth that has been generated from the oilsands developments. “What’s worked well for Fort McKay is a realization that we’re going to share in the wealth of development, and by doing that we’ll be able to control the pace of development, so it helps on the environmental side,” he said. Having a seat at the table has benefited the community. “What’s really interesting is that industry listens and is willing to adapt how they do things,” said Hyde. “Fort McKay’s perspective is to stay positive and find solutions - not get into a world of hiring a bunch of lawyers, having protests and road blocks. McKay has been doing this for 20 years.” Fort McKay is about 25 minutes north of Fort McMurray, the oilsands hub in Northeast Alberta. The community’s 600 residents have done well for themselves by working hand-in-hand with petroleum companies when they can, but opposing projects that are deemed to destructive. It’s a strategy that allows for profits to be invested back into the community. Fort McKay,

for example, is planning to build a high school in the near future. Fort McKay is also able to maintain strict environmental monitoring, explained Hyde. “Obviously there are economic benefits, jobs, dividends that come back into the community, and other things is on the environmental side. The companies in this region have huge environmental positions, because they’re concerned about the environment [like us]. So we work together with them,” he said. “It’s counterintuitive, but that’s proven to be a pretty good benefit to both the companies and McKay.”

McKay’s approach is to keep talking about the issues, even the hard ones. To be sure, Fort McKay doesn’t go along with every project that comes its way. It’s currently embroiled in a legal dispute to block development on a what would be a 20-kilometre buffer zone on land that is owned by PetroChina Co. Ltd. Hyde said the Energy and the Oil Sands, Aboriginal Perspectives conference is the first time Fort McKay joined with the Canadian Council of Aboriginal Business to bring the major oil and gas players together with aboriginal organizations to talk about shared responsibilities and build working relationships. President of the Canadian Association of Petroleum Producers, Dave Collyer and Janet Annesley, its vice president, joined the Fort McKay First Nation conference. “Canada’s oil sands producers rely on mutually beneficial relationships with Aboriginal peoples and we welcome the opportunity to build on past successes together through events that allow all participants to discuss various issues and perspectives,” said Collyer. “Canada’s oilsands producers are pleased to be part of this conference and we look forward to engaging in a constructive dialogue.” CAPP says that Aboriginal companies in Northeast Alberta have pulled in more than $8 billion over the past 14 years by working with energy companies. When Karim-Aly Kassam, professor at Cornell University, addressed the attendees, he noted that the region possesses the largest development in the world in terms of the scale of wealth to be generated for Aboriginal communities. “So let’s get it right,” he said. For Hyde, the key to moving forward is to maintain constructive dialogue. “The conversation is not antagonistic,” he said. “People are focused on shared values.”

‘Fort McKay’s perspective is to stay positive and find solutions. McKay has been doing this for 20 years.’ – Dayle Hyde To that end, Fort McKay First Nation held an energy conference at the end of January to bring the different players to the same room to talk about challenges and ways to overcome them. The conference, named Energy and the Oil Sands, Aboriginal Perspectives, brought together 400 people from various sectors. Fort McKay Chief Jim Boucher received a standing ovation for his message about balancing development, allowing community to create wealth and to leave this planet in a great shape for his grandson. The goal of the conference, said Hyde, was to stimulate a discussion between the First Nation, industry, community, individual companies and government. “There is a long history of people working together, so we want to keep the discussion going,” Hyde said. “As long as we’re talking about the issues, we’ll find a way to resolve them.”

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first nations

lng summit ‘to turn the debate’ ‘This is a rapidly developing issue, especially as there is considerable pressure on First Nations to make quick decisions which could have major impacts for generations.’

Matt Lamers Staff Writer

First Nations across British Columbia’s energy corridor are an integral part of the upstream and midstream production chain. Most of the fracking takes place on First Nations’ traditional lands and First Nations are providing an increasingly important pool of labour. Accordingly, First Nations leaders are gathering in Fort St. John from Feb. 17 to 19 to talk about the potential risks and benefits of LNG development, and how to involve their communities in the decisionmaking process. It’s the third in a series of conferences that started in 2013. After the event in Fort St. John in February, another will be held in Fort Nelson in the spring. The First Nations Liquefied Natural Gas Summit in October 2013 took place in Prince George. Thirty-six First Nations communities directly affected by LNG development were represented. Chief Terry Teegee from the Carrier Sekani Tribal Council, the organizer, said it fostered communication to deal with the large LNG projects that are in the works. “The biggest challenge for a First Nations community is working together. I think it’s a big problem when we have communities [acting] individually, because that kind of sets the bar on how these companies negotiate with communities and I think we’re

way better off if we’re together. Our leverage is a lot better when we’re together than when we’re apart.” This time around, Anna Barley, Treaty 8 Tribal Association’s acting director of administration and economic development, said the hope is that the conference will help First Nations decide on the next steps, and also give government and industry a better understanding of the issues from their perspective. “The first two summits were a great way to bring together the very diverse First Nations affected by LNG proposals, and establishing opinions and areas of agreement,” said Barley. The Fort St. John summit is being hosted by Treaty 8. It will offer tools and workshops that are designed to help First Nations leaders return home with a clearer idea of what they are going to do next and how they will achieve it. “This is a rapidly developing issue, especially as there is considerable pressure on First Nations to make quick decisions which could have major impacts for generations,” said Barley. “The plan has always been for multiple events, and the first two summits made some real progress. “We want the third to turn the debate, discussion and planning into real example and action.”

Participants of the First Nations Liquefied Natural Gas Summit in October 2013 in Prince George. From top: Grand Chief Ed John, Prince George summit chairperson Leonard Thomas, Regional Chief Jody Wilson-Raybould, Tribal Chief Terry Teegee, Lheidli T’enneh Elder Darlene MacIntosh and B.C. Minister of Natural Resources Joe Oliver. First Nations leaders are gathering in Fort St. John from Feb. 17 to 19 to talk about the potential risks and benefits of LNG development, and how to involve their communities in the decision-making process. Kelly Bergman PHOTOS

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for lng, ‘the sooner the better’ CAPP report a primer for Western Canada’s potential Matt Lamers Staff Writer

British Columbia is on track to develop its natural gas industry, according to Mark Pinney, author of the report “An Overview of the World LNG Market and Canada’s Potential for Exports of LNG.” But he warned that the opportunity won’t be around forever. “I think it’s the sooner the better,” he said in an interview. “The longer you wait, the longer you give someone else a chance to serve the market before you.” Pinney is manager of markets and transportation at the Canadian Association of Petroleum Producers. The report, released in January, identifies countries which are competing with Canada to develop their natural gas resources for export. These include Qatar, the largest exporter of LNG in the world, Nigeria and Australia. Pinney said that if Canada has a leg up on these projects, it’s due to our relative stability and geographic advantages. “I think Kitimat and Prince Rupert are geographically well positioned to serve the huge markets in Asia. “Direct ocean access is good. Let’s not forget the United States. I think it’s really good that we don’t have to worry about traversing the Panama Canal,” he said. “The fact that we have direct ocean access and eight to nine [fewer] sailing days [to Asia] is a strong advantage.” The report also noted: “With only eight sailing days to Japan and 11 sailing days to China, the West Coast

Spectra updates FSJ council Matt Lamers Staff Writer

An aerial view of Kitimat, which is vying to be one of two export hubs on the West Coast. Mark Pinney, author of the report “An Overview of the World LNG Market and Canada’s Potential for Exports of LNG,” said Canada is on track in developing its LNG.

sources of power, and the price of LNG is significantly lower in North America than it is in Asia. In Japan, for example, LNG on average costs $14.66/GJ. In North America, however, that compares to under $4/GJ. The report acknowledges the fact that exports of LNG to Asia will only be economic if the market price for LNG in Asia re– Mark Pinney mains “significantly higher” than market ports of Kitimat and Prince Rupert prices in Canada. That’s because exare closer than any other North porters will incur significant costs American port to these markets.” associated with the production, Two factors are driving LNG poliquefaction and delivery of natural tential in Western Canada: Asia’s gas some 7,000 kilometres away. Adgrowing economies, especially ditional costs will come from a yetdeveloping ones, require cleaner to-be-announced LNG tax by the

‘The longer you wait, the longer you give someone else a chance to serve the market before you.’

Sam Beebe PHOTO

provincial government for its “B.C. Prosperity Fund.” Of the approximately 20 LNG projects that are in the pipeline, none have yet to make a final investment decision. The consensus is that only one to three will actually happen. For those companies still considering whether or not to move forward, Pinney said they are looking at complex and rigorous analyses. He identified progress on their permits and environmental applications as one factor. “I haven’t heard of any major hiccups there. I think we’re seeing some, generally speaking, good partnerships with First Nations. I think the biggest hurdle will be the need to have some long term sales contract in hand. “I think once they get these longterm contracts in place, I think that will be a major hurdle for them to overcome and say ‘yep let’s move forward.’” See LNG on PAGE 29

Spectra Energy representatives updated Fort St. John City Council at the end of January on the proposed Westcoast Connector Gas Transmission Project. At the meeting, Franca Petrucci, a community coordinator, said the energy company hired a technical workforce manager six months ago and a vendor registration database has been established. She also said the pipeline would result in 4,000 jobs in the construction phase and 60 more post-construction. The proponent submitted its draft Application Information Requirements (dAIR) early last year. The Spectra representatives told Fort St. John councilors that the company intends to apply for an Environmental Assessment Certificate this spring. The proponents, Spectra Energy and BG Group, envision a pipeline that would move 4.2 billion cubic feet of natural gas per day from Spectra’s pipe system at Station 2, southwest of Fort St. John, to Ridley Island, near Prince Rupert, some 850 kilometers away. The proposal involves building a twinned 48-inch pipeline. It would cost about $6 billion. The associated LNG project is Prince Rupert LNG, which is a 50/50 joint venture by BG Group and Spectra Energy. On Dec. 16, 2013, Prince Rupert LNG Exports Limited was granted a licence to export 21.6 million tonnes of per year for a term of 25 years. Prince Rupert LNG’s final investment decision isn’t expected until 2015 at the earliest.

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Fort St. john

Act quick on LNG, says ex-Lib leader Matt Preprost Staff Writer

British Columbia businesses should not be fearful, but bullish, when it comes to getting involved in the opportunity liquefied natural gas developments presents to the province. That was the message former B.C. Liberal party leader Gordon Wilson delivered to local business groups in Fort St. John as part of two-day stop promoting the province’s LNG Buy BC program in the Peace Region. Wilson told the two-dozen attendees that he came out of retirement to develop the program as a skeptic, but says trotting around the globe and meeting with industry proponents and officials has given him a chance to analyze the potential. “I really do believe this is an opportunity to transform the economy of British Columbia,” said Wilson. “And one we should not be fearful of we should be bullish about getting involved with. My job is to get people involved as best we can.” Right now, the program – announced last year by Premier Christy Clark as a “matchmaker” service – is developing an online portal to expose and link local businesses to procurement opportunities from the multi-national proponents behind some of the projects slated for the province. “It’s a unique way for British Columbians to engage, and it’s a great way for industry proponents to easily start to interface with people who

want to engage,” said Wilson. The site would link into existing industry supply chain connectors run by the Northern Development Initiative Trust and the B.C. Business Network, and is expected to launch later this year, according to Wilson. Following the launch will be “interactive boot camps” with LNG proponents to understand development plans and procurement requirements and standards, said Wilson. There will also be a conference and tradeshow in Vancouver from May 21 to 23 for suppliers and industry to meet face to face with key provincial decision makers. “It’s going to be a very good opportunity, a real opportunity to actually talk specifically to people, and you won’t be working through somebody like me – there’s no middle man,” said Wilson. British Columbia is well positioned geographically to meet the growing thirst for LNG in Taiwan, Japan, Korea, and China said Wilson. However, the province has much to learn from other countries already developing the product, such as Australia, that didn’t understand the “monstrously large” scope of the industry and its impacts on communities, he noted. Establishing the industry comes with its challenges and issues, Wilson noted, from the cyclical nature of building and operating that bring fluctuating populations, and increase demands on housing, and municipal water, sewer, road and waste services.

Gordon Wilson visited Fort St. John in February to trumpet the province’s LNG Buy BC program, created to link local businesses with job opportunities expected to flow from LNG development. Matt Preprost Photo

“All of these are job creators, all of these spin out into the local economies, and all of these really provide an opportunity for British Columbians to engage in long term employment,” Wilson said. Wilson later added there’s also an expected increase in demand for health and safety services, along with hotel supply, and food distribution. After the meeting, George Katona of Alpha Safety Ltd. said the company has no shortage of work for its staff medics and training instructors. The business is currently running 10 of 18 medic trucks, and Katona expects to be running at full capacity soon, with a chance to add more. “Everybody needs a medic,” he said. Alpha also trains between 6,000 and 7,000 people a year in first aid, H2S safety, along with a number of other industrial and recreational courses. “H2S… we hold three times a week, sometimes four. We could put

everyday classes,” Katona said. “We have the capacity to expand and hopefully we can take advantage of that.” Vancouver-based realtor Connie Kim said she was expecting more detail from the presentation. “I already have a general idea from a lot of different press, I wanted more detail, what kind of industry, or what kind of companies, or what kind of opportunities (there are outside of LNG),” she said. Kim said she has a number of clients interested in scooping up residential and commercial property in Fort St. John to develop housing and business opportunities as workers swarm to the region. “You have more cars and more industry. I just came here to look around.” Wilson was scheduled to meet with Fort St. John city leaders Tuesday afternoon. He will be in Dawson Creek today to meet with businesses and officials.

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Matt lamers Photo

Drilling forecast to rise in B.C. in 2014 Matt Lamers Staff Writer

The Petroleum Services Association of Canada (PSAC) updated its 2014 Canadian Drilling Activity Forecast, increasing its outlook on drilling to 10,930 wells across the country. That represents an increase of 130 wells from the original forecast last October. In British Columbia, drilling is predicted to rise to 560 wells this year, which is an increase of 10 from October’s original estimate. The PSAC also estimates that 6,642 wells will be drilled in Alberta, up by 87. By type, 85 per cent of the wells across Canada are expected to produce oil. “We are adjusting our numbers slightly upward due to stronger than expected activity

levels at the close of 2013, specifically in central Alberta and various regions in Saskatchewan,” said Mark Salkeld, president of PSAC. “Our forecast remains pretty constant year over year because we are seeing a continuing trend towards multi-well pads with multilateral and more complex completions, and we expect this trend to continue even beyond 2014 given that advances in technologies are making such wells more logistical and economical for the producers.” The PSAC estimates are based on the assumption that average natural gas prices will be $3.50 mcf and crude oil prices will average out at $95/barrel.

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ENVIRONMENT

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can lng go green? WILLIAM STODALKA Staff Writer

A new report from a Canadian environmental group calls for the B.C. government to power its LNG production with renewable energy rather than fossil fuels. “If the LNG companies and government choose to primarily power this sector with renewables, then B.C.’s clean power industry is ready to deliver with a cost-effective product,” said Paul Kariya, executive director of Clean Energy British Columbia, the group that wrote the report. The report primarily focuses on the benefits these types of mandated renewable energy changes would provide to northwestern B.C. and the LNG facilities located there. Changing away from a fossil fuel approach “will increase regional permanent employment related to LNG by 45 percent, decrease carbon pollution by 33 percent, reduce smog, and build the foundations of a renewable energy economy in northwestern British Columbia.” The changes would only increase the costs of LNG by about two percent, the report stated. Merran Smith, a spokeswoman for Clean Energy Canada, said that these types of changes would also benefit northeastern B.C., where natural gas is produced

before shipped off to become LNG. “There are things we can do to help reduce that carbon footprint, and one of them is to electrify the Northeast,” she said. “One was just plugging the leaks. There’s a lot of old equipment up there; there’s new technologies now that are much tighter.” Smith said that northeastern B.C. natural gas industry could also benefit from increased use of wind power. In the past, critics of wind power have pointed to the damage these installations can cause to birds. James Glave, the communications director for Clean Energy Canada, pointed out an Environment Canada study that showed that cats, window collisions, vehicles and transmission lines killed 95 per cent of birds. A WWF report also stated that global climate change could cause major global extinctions for birds. Smith also said that while her group hadn’t officially crunched the numbers for increasing the amount of green electricity would mean for northeast B.C. jobs, she believed it would increase the amount of jobs present in the region. “We can create more jobs, less

pollution, and lasting economic legacy for the region if we required natural gas industry to use less energy,” Smith added. “It’ll really help B.C. get off that boom and bust roller coaster, and I think that applies to northeastern bc as well.” Late last year, Clean Energy Canada also called for other changes in B.C. LNG policy. “We concluded that without policy leadership, made-in-B.C. LNG will not be the cleanest in the world but would instead emit more than three times the carbon pollution of the current global gold standard,” their report stated. “We based our finding not only on the emissions associated with LNG production, but on the full carbon footprint of the fuel they would produce - from wellhead to waterline.” Zoher Meltralta, an LNG expert, concurred with many of the reports findings. However, he felt that more than anything, the LNG industry needed more government guidance. “A lot of [the changes] will have to come from clear government direction,” Meltralta added

Charles Cook photo

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communication Matt preprost Photo

Matt Lamers Staff Writer

Tanner Walde thinks British Columbia should forget about developing its vast reserves of natural gas. “I think we’re at a point in the world where we need to be worried, and consider the environment for once over profit,” the 17-year-old said. The resident of White Rock, a suburb of Vancouver, said his position is set in stone. It’s a common refrain from Brit-

ish Columbia’s youth, especially those in the South. Only half of British Columbians are in favor of the government’s plan to expand the development and export of liquefied natural gas, and 32 per cent are outright opposed, according to an Insights West survey of 638 people, even though doing so could bring 100,000 jobs and add billions to the province’s coffers.

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According to some polls, upwards of 60 per cent of British Columbians are against the construction of pipelines to get natural gas and bitumen to proposed export terminals in the Northwest. Opposition is staunchest amongst young people. In recent years, the opposition has been deteriorating somewhat, in large part because the industry and government have been putting more effort into getting their message to the public. Results vary greatly from poll to poll. In some cases, oil and gas clearly wins in overall public perception, but still finds a way to lose the policy war. That’s the case so far for the proposed Keystone XL pipeline in the United States. Despite a public approval score of 77 per cent south of the border, the minority of Americans who oppose the pipeline have been in the driver’s seat. Canada’s two largest pipeline proposals have the support of a majority of the country; Energy East (57 per cent for, 25 per cent against) and Northern Gateway (51 per cent for, 28 per cent against). The national survey was conducted by CROP on behalf of the Atlantic Provinces Economic Council, the Canada West Foundation, the Federal Idea and

the Mowat Centre in September 2013. It’s a problem the oil and gas industry has been dealing with for years. Gary Weilinger, Spectra Energy’s vice president of strategic development and external affairs, said that winning the PR war and getting a “social license” is a priority for the industry. “We can do a much better job for sure,” he said. “We need to do that outreach to help people understand how they operate safely and why they can live safely in harmony with pipelines in close proximity to their backyards. We need to do absolutely a much better job.” One way Spectra is doing that is through the Energy First program, which aims to make sure people have a much broader understanding of how the company operates. Weilinger said Spectra is making more of an effort to reach out to communities in an effort to be more forthright. “Let’s cut through the rhetoric and understand what the underlying issues are,” he said. “Yes, we’re going to have an impact. There is an impact by being there vs. not being there at all, but there are also ways of mitigating those impacts.” The federal government joined the fray last October when it

‘We need to help people unerstand how pipelines operate safely and why they can live safely in harmony with pipelines.’ – Gary Weilinger

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breakdown

Matt lamers Photo

prepared a $24-million advertising blitz to improve the reputation of the oilsands. A request for proposals issued by Natural Resources Canada outlines the two-year program, which would target political, business and media leaders around the world. “Canada has been, and continues to be, the target of intense and sustained public relations campaigns by domestic and international organizations, criticizing our domestic natural resource development policies and companies engaged in resource developments,” according to the Natural Resources Canada document. The Canadian Association of Pipeline Producers is on the front line of the PR war. David Pryce, CAPP’s vice president of operations, thinks it isn’t a matter of public relations as much as it is about access to information. “I would frame that for me as ‘what do we need to do to get the public the information, and understand what’s being proposed, and how it could proceed

responsibly?” he said. “We’ll provide a voice into that, but other people need to provide a voice to being the credibility there in that as well.” Pryce wants the academ-

prove transparency in the industry, especially when it comes to hydraulic fracturing. “CAPP put out some best practices for fracking a couple years ago,” he said. “One of those practices

‘CAPP put out some best practices for fracking. One of those practices was the full disclosure of frack fluids the public is asking for.’ — David Pryce

ic community to get more involved. “You get academic reports that come out about that and they don’t get communicated well either,” he said. “So I think that’s the other thing, not only who should do the work, but how do we get the information in front of people that are asking those difficult questions.” CAPP has made strides to im-

was the full disclosure of frack fluids the public is asking for. Why wouldn’t we do that? If we want that confidence, that social license, we need to do it.” Former federal opposition leader Preston Manning has some ideas on how the oil and gas industry could improve communication with the public. He thinks petroleum companies should be straightforward about their interests.

“There is a lot of advertising that’s kind of funny, you know, ‘We’re out to make society better,’ and all of that is fine, but I think just being frank [is better],” he told Pipeline News North in a phone interview. “I think a lot of industry advertising could be more frank. They tend to want to say they’re doing other good things. But really you’re in the petroleum industry. Why not just say it? “‘If you don’t like gasoline, or you don’t like oil, or you don’t like what’s heating the factory or the office you’re working in, well maybe we’re not your people.’ ‘But if you need any of those, that’s what we do.’ You know?” While environmental catastrophes have damaged the industry’s reputation in the past, Manning thinks that environmental protection and petroleum development can occur in tandem, not necessarily exclusively. That’s a view supported by most Canadians. See COMMUNICATION on PAGE 31 SAm beebe photo

‘Let’s cut through the rhetoric and

understand the underlying issues.’

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JOBS from PAGE 15 Connecting immigrants with employers remains a challenge. That’s where the Immigrant Services Society of B.C. comes in. In a world where the the Hiring Assessment Tool Kit is fully implemented, the ISSBC will probably play an important role in connecting immigrants with either job assessors or potential employers. “You have to have a partner, because it’s hard to find these people and it’s hard for them to find employers,” explained Steward. “Working with a partner like that is huge, not only in terms of finding the people, but also getting some insight into what kinds of assessment tools to use and they’re the ones who have the experience with language proficiency and lining up English proficiency requirements with the occupation.” Because all the jobs are in northern B.C., and the immigrants are in southern B.C., the team is developing a model so most of the testing can take place online and, if possible, face-to-face. Either the assessor can go to the person or the person can go to the assessor. She expects that the interviews would be conducted over the phone once the assessors are comfortable with the program “so it truly reaches across geographical distances.” The Hiring Assessment Tool Kit team will be ironing out the process through the end of February with an eye on an end-March rollout. R001622840

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ENVIRONMENT

reporter@pipelinenewsnorth.ca

LNG boom will spur wage growth British Columbia income to top Alberta’s from natural gas Matt Lamers Staff Writer

Wages in British Columbia will exceed those in Alberta once final investment decisions are made and companies begin spending billions of dollars on production centres, pipelines and liquefaction plants on the West Coast, said the chief energy economist at ARC Financial Corp. In an opinion piece published in the Globe and Mail on Jan. 27, Calgary-based author and economist Peter Tertzakian noted that workers are already heading west as companies have been cautiously increasing their expenditures in British Columbia’s gas fields to attract skilled workers. There are about 20 LNG projects of all sizes at various stages of development in the province. Although none of the projects have made a final investment decision, many have been increasing spending in preperation. Employment patterns would roughly follow investment patterns. The Globe and Mail article cited Statistics Canada data since 2001 that showed that weekly wages in the mining, quarrying and oil and gas extraction sector rose the most in Alberta, but lagged in B.C.

There are early signs that the gap is closing. From January to October 2013, wages in B.C. rose $250 a week. In the piece, Tertzakian noted that Alberta’s

Wages in British Columbia will exceed those in Alberta once final investment decisions are made and companies start spending billions of dollars on production centres, pipelines and liquefaction plants. oilsands boom could be a sign of what’s to come in B.C. A decade ago, he wrote, workers were paid $1,300 per week on average, but that rose substantially, up 40 per cent by 2010. Behind the increase was a nearly $100-billion aggregate investment in the sector in that timeframe. Tertzakian warns that the bigger paychecks will come with a cost. The higher labour demand that drives up wages would also spur inflation, meaning workers will get less bang for their buck when they spend their wages.

Matt lamers Photo

LNG from PAGE 22

Our goal is to get you

home safely, every day.

At Enform, our vision is to eliminate work-related incidents and injuries in the upstream oil and gas industry. Everything we do is dedicated to continuously improving your safety. We were created by industry, for industry and together we are making a difference. Learn more about us at www.enform.ca Your safety is our business.

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Importantly, the report also examines whether global demand for LNG can keep pace with supply. It notes that demand is forecasted to rise from about 300 Bcf/day today to more than 500 Bcf/day by 2050. For this outlook, CAPP considered two scenarios for Western Canada: The first is a constrained market and the second is global opportunity. The most significant difference, the report reads, is the latter assumes that by 2023, five LNG export trains will be in service on Canada’s West Coast, with each having the capacity to export five mtpa of LNG (or 0.7 Bcf/d per train). “We think that’s a readily attainable number,” said Pinney. “This report is two things. It gives people an update on a fast moving global market, but it also shows the reader how important this is to develop a new market because it has a significant implications on the future production profile.” “We’ve got tremendous resource potential, but we’ve got market constraints. We’ve got increasing competition in our traditional markets and the LNG market is a wonderful opportunity for us.”

Fort St. John 250.785.6009

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locations that suit your business needs • Distributed to the community in general through these fine publications, Alaska Highway News, Dawson Creek Daily and Fort Nelson News. • Distribution by mail and direct drop-off to Oil & Gas companies,and related businesses and organizations, in the following communities: British ColumBia – Arras, Baldonnel, Cecil Lake, Charlie Lake, CHETWYND, Clayhurst, DAWSON CREEK, Farmington, FORT NELSON, FORT ST. JOHN, Goodlow, Groundbirch, HUDSON’S HOPE, Moberley Lake, Pink Mountain, Pouce Coupe, Progress, Rolla, Rose Prairie, Sunset Prairie, Taylor, Tomslake, TUMBLER RIDGE, and Wonowon. alBerta – Baytree, Bear Canyon, BEAVERLODGE, Berwyn, Bezanson, Bonanza, CLAIRMONT, Eaglesham, FAIRVIEW, Falher, Girouxville, GRANDE PRAIRIE, Grimshaw, Grovedale, HIGH PRAIRIE, Hines Creek, Hythe, LaGlace, MANNING, McLennan, PEACE RIVER, Rycroft, SEXSMITH, Silver Valley, Spirit River, VALLEYVIEW, Wembley, and Worsley, Zama City. R003424352

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trans mountain pipeline

edmonton

Most of B.C. supports Trans Mountain pipeline: Poll Support highest among older males, opposition highest among women Matt Lamers Staff Writer

burnaby

Support amongst British Columbians for Kinder Morgan’s Trans Mountain Pipeline expansion surpasses opposition, according to a new poll. Since Kinder Morgan filed its Facilities Application on Dec. 16, 2013 with the National Energy Board, it has drawn considerable opposition from some communities along the route. Kinder Morgan, for its part, says it’s trying to work with the communities that could be impacted by the expansion of the pipeline, which stretches from near Edmonton to Burnaby. The Insights West poll contacted 728 British Columbian social media users from Jan. 7 to Jan. 9 on the proposed expansion. It is one of two major pipelines already crossing British Columbia that are planning to add significantly to their capacity.

The original pipeline was built in 1956 to transport crude oil from Strathcona County, near Edmonton, to the Westridge Marine Terminal, near Vancouver. The Insights West poll found that 48 per cent of British Columbians were in support of the proposed project, while 43 per cent were opposed to it. It found that about 80 per cent of residents were aware of the proposed expansion. However, the ratio of residents who were undecided on pipeline increased from 3 per cent in January 2012 to 11 per cent in January 2014. “As was the case last year, the Trans Mountain expansion remains a contentious issue across British Columbia,” said Mario Canseco, vice president of Insights West. “The pro-expansion side is still ahead of the

COMMUNICATION from PAGE 27 A poll conducted last year by Ipsos Reid found that 66 per cent of the 2,008 Canadians polled believe the country could increase its oil and gas production without creating significant environmental distress. The environment is the top concern for Canadians when it comes to energy production, which helps explain the persistent opposition that pipelines and petroleum developments often face in places like British Columbia. Another poll conducted by Ipsos Reid for Shell Canada found that the environment

anti-expansion side by just five points at the provincial level, but the proportion of residents who have not made up their minds has almost quadrupled.” The proposed expansion would increase capacity from 300,000 barrels per day to 890,000 barrels per day and would require approximately 981 km of new pipeline to be constructed. Support and opposition was correlated with demographics and geographic residence. Only 39 per cent of Vancouver Island residents support the project, but that rises to 49 per cent of residents across the Lower Mainland and Fraser Valley. Fifty-eight per cent of males polled said they supported the project, but support drops to 37 per cent for female residents of the province.

ranked as the most important issue related to future energy needs (27 per cent), even higher than climate change (20 per cent) and price (20 per cent). “The challenge,” Manning said, “is to convince the majority of people that if it’s done right and done responsibly, addressing environmental concerns, then it’s in the interests of the majority to allow those things to proceed.” Mr. Manning also said that the best people to determine the outcome of the pipeline and LNG projects are British Columbians themselves. “Ultimately it’s British Columbians themselves that have to be convinced that this is

Young people are much less likely to support the pipeline. Only 39 per cent of men and women aged 18 to 34 gave the pipeline the nod, but that rose to 55 per cent for those over 55. Canseco wasn’t surprised by the results. “The findings of this survey on the Trans Mountain Pipeline confirm what we learned on our recent research projects related to fracking and the Northern Gateway Pipeline,” Canseco said. “Residents of Vancouver Island, women and the youngest residents of the province are more likely to look at energy projects with skepticism.” Applications to participate in the National Energy Board’s Public Hearing on the project’s application were due on Feb. 12 and public hearings have already begun.

in their best interest. The more that’s done, the better.” It’s not only private energy corporations that are trying to increase their profile in the public. Paul Jeakins, commissioner and CEO of the B.C. Oil and Gas Commission, told PNN that his industry has expanded in the public consciousness over the last five years. “I think it has been a natural evolution,” he said. “I think it has expanded in the public consciousness over the last five years, but it doesn’t just turn on a dime. People are starting to talk.”

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