Province's energy plans faltering

By Tom Fletcher
Goldstream Gazette
Apr 06 2007

When Premier Gordon Campbell took to the stage at his government's fifth annual natural resource forum in Prince George last week, he was in full salesman mode for the booming north. Prince Rupert port expanding, oil and gas drilling revenues up another $100 million in 2006, Prince George airport as a cargo hub, oil pipelines from Alberta, all driven by huge demand from China and the rest of the Pacific Rim.

And by the way, Campbell mentioned that the province's latest energy plan will be out in the next few weeks. Fasten your seatbelt, there may be turbulence.

We're still feeling the effects of the 2002 B.C. energy plan, which mandated B.C. Hydro to purchase independent power rather than expand itself. And already there are signs that the Klondike fever that has gripped the province with high natural gas, oil and coal prices is cooling off.

B.C. Hydro was among the sponsors of the natural resource forum, a pet project of Agriculture and Lands Minister Pat Bell. The main sponsor was, ahem, Alcan, which just got the bad news from the B.C. Utilities Commission that its lucrative power sales deal with B.C. Hydro isn't in the public interest.

While that's being rewritten and the fate of the Kitimat aluminum smelter hangs in the balance, there are other problems.

In November, Calgary pipeline company Enbridge announced it was pushing back plans for its Gateway project, twin pipelines to bring light petroleum from Kitimat to the Alberta oilsands, mix it with heavy oil and pipe it back for export.

Enbridge said demand is more pressing for new pipelines south the U.S., so Gateway's completion target is now 2012-2014. The Carrier Sekani Tribal Council has filed a lawsuit over use of its territory, and there are increasing doubts about the wisdom of burning huge quantities of natural gas to extract heavy oil for an energy gain of perhaps 30 per cent.

Energy Minister Richard Neufeld's 2002 energy plan also mandated the development of coalbed methane, which has its own environmental risks, mostly related to the salty water that has to be pumped out of coal formations in order to extract the gas. The province's plan to develop coalbed methane recently hit a bump when Outrider Energy announced it was pulling out of a project that has seen strong opposition from the people of Telkwa and Smithers.

The other company involved, Norwest Corporation, says it will continue its application for a tenure to tap into a coal seam that runs right through the community. And a fact sheet from Neufeld's ministry makes it clear that the discussion isn't about whether to develop coalbed methane, merely where and how.

The proposed Site C dam on the Peace River and the coal-fired plants proposed at Tumbler Ridge and Princeton have been discussed in earlier columns.

I'll stick by my prediction that Site C will not proceed, and that's one reason why the coal plants will. As the premier hinted in Prince George, there will likely be more wood-fired energy production to deal with the huge amount of beetle-killed timber in the province.

The only northern energy project that appears to be going full speed ahead is a liquefied natural gas facility, also in the Kitimat area. Kitimat LNG received it federal and provincial environmental permits in 2006, and if offshore gas suppliers are secured, construction could start this year.

Some of that gas, shipped in from Australia and other far-off ports, would likely end up going to those Alberta oilsands. If you think there's a lot of hot air being expelled over the environment now, just wait a few weeks.

Energy projects aren't the only things facing delays in northern B.C.

As the premier was speaking in Prince George, the First Nations Summit issued a statement condemning the Kemess North copper and gold mine expansion project. Maurice Ethier, general manager of the Kemess South mine, thanked Campbell when he left the resource forum stage.

Mine officials learned at the beginning of the year that the federal and provincial governments have extended their environmental review for Kemess North, after the Gitxsan First Nation said it didn't have adequate time or resources to take part.

Kemess South will be mined out by next year, and 500 jobs and $150 million in economic activity for north-central B.C. depend on the Kemess North expansion. First Nations Summit executive Dave Porter called on the federal government to stop the project, which would use a remote lake as an acid rock tailings pond.

Porter and the First Nations Summit have been allies with Campbell in his new relationship efforts, but their view on this project is directly opposite to the premier's upbeat forecast for mineral development in B.C.

- Tom Fletcher is B.C. bureau reporter for Black Press newspapers.