B.C. projected to rival Alberta for gas production

By Scott Simpson
Vancouver Sun
April 25, 2009

The province has large-scale reserves that are only beginning to be developed

British Columbia could rival Alberta as Canada's largest producer of natural gas within 10 to 20 years, a Vancouver Board of Trade energy forum heard Friday.

EnCana Canadian Foothills division president Mike Graham said improved technology is setting off a "renaissance" of natural gas production in North America, and B.C. is poised to benefit from it.

The province has large-scale reserves that are only now beginning to be developed as a result of sophisticated new extraction methods. And they are coming into production at a time when natural gas is gaining favour as an alternative to heavier fossil fuels, Graham said.

He noted that B.C. is the only Canadian jurisdiction -- and just one of three in North America -- to record an increase in production last year. The others were Texas and Louisiana.

"No surprise there, as both those states have unconventional shale gas plays, as does B.C.," Graham said.

He cited Horn River Basin shale gas and Montney's gas-saturated silt as "two of the hottest plays in North America."

"Between the two, there is more than 800 trillion cubic feet of gas in place. To put that into perspective, B.C.'s annual production is one trillion cubic feet of gas."

At present, B.C. accounts for about 20 per cent of annual Canadian gas production, but Graham expects that to make a substantial jump.

"The potential exists for natural gas production to grow in B.C. by a factor of two to three times in the next 10 to 20 years, challenging Alberta as Canada's largest gas producer.

"Investment in the industry here is up to about $8 billion a year. Natural gas has become a significant component of B.C.'s diversified industry and export base, accounting for upwards of $4 billion a year."

He noted that natural gas has "significant potential to displace coal for power-generation purposes."

Many U.S. utilities are trumpeting it as a transitional fuel that could cut greenhouse-gas emissions by half, bringing North America closer to its emission targets without a major technological advance.

Spectra Energy vice-president Gary Weilinger noted that energy is now "by far B.C.'s largest single source of provincial revenue and its fastest growing industrial sector. And our province boasts massive deposits of clean, natural gas."

"We're all in favor of renewable energy sources that help us reduce our dependence on fossil fuels, but we need to be realistic," Weilinger said.

"Even by 2030, renewables are expected to account only for eight to 10 per cent of global energy supply.

"The reality is, natural gas is typically the backup at wind and solar facilities to deal with the fickleness of nature."

Terasen Inc. president and CEO Randy Jesperson described gas as a "foundational energy form which will underpin the needs of society for the foreseeable future."

Jesperson noted that globally accepted greenhouse-gas reductions are projected to reach 80 per cent by 2050, and that "we cannot possibly achieve these levels of reductions by focusing on large emitters" because half of Canadian emissions "stem from use of fossil fuels in homes, businesses, and institutions."

David Demers, chief executive officer of Westport Innovations, said the biggest market for the company's natural-gas engine technology has been garbage and recycling trucks. "Every manufacturer of these vehicles in North America now offers our engines as an option."

Demers said natural gas-fuelled vehicles could take a substantial bite out of greenhouse-gas emissions.

ssimpson@vancouversun.com

Blog: www.vancouversun.com/energy

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