The Haisla Nation’s water-based production and storage facility, proposed for the Douglas Channel in northwest B.C., will not undergo a federal environmental review

Kitimat is no stranger to large-scale industry, but this resource town is now considering a project with a twist: a liquified natural gas (LNG) terminal on its own fabricated island.

Originally built as an industry town to service the Alcan (now Rio Tinto) aluminum smelter, Kitimat has become a central location for some of the biggest industrial projects in B.C., including the LNG Canada export terminal, which will be fed by the Coastal GasLink pipeline.

The Haisla Nation, a staunch supporter of the LNG Canada project, is proposing to build and operate its own facility and one of North America’s first-ever floating LNG terminals: Cedar LNG.

With phase one of the project planned for 2022 and operations to commence in 2025, the project is in the pre-application phase for a B.C. environmental assessment certificate. A public comment period will soon be announced. 

In January, the federal government approved a request from the B.C. government to conduct a provincial environmental impact assessment of Cedar LNG, meaning this novel facility — with potential impacts to the climate and marine habitat — will not undergo federal review. 

Here’s what you need to know about the proposal.

1. Wait, what? This is a floating LNG terminal? Explain.

With little flat land left along Kitimat’s mountainous shoreline, Cedar LNG plans to build 500 metres out into the Douglas Channel, a deep-water fjord. The Haisla-owned company would construct one or possibly two jetty-moored dock facilities for a marine terminal to feed export tankers bound primarily for Asia.

The facility would sit in the Kitimat Arm, just 10 kilometres southwest of Kitimat’s town centre and across the water from the Haisla’s Kitimaat Village. 

The proposed facility would pre-treat, liquify and transfer LNG onto vessels — all on the manufactured industrial island.

A detailed project description produced by the Haisla notes the “LNG production unit will be permanently moored to a marine jetty that will either be constructed on traditional marine piles or as a floating structure permanently anchored to the foreshore.”

The final design of the facility will be determined “as engineering design evolves” and will be more fully described in the project’s environmental permit application. 

While there are a handful of other floating LNG proposals in North America — including Woodfibre LNG, which has proposed to store gas in a floating storage and offloading unit in Squamish — there are only two active floating LNG terminals in the world: one in Australia and the other in Malaysia.

2.What will the Cedar LNG plant do?

The plant would take fracked gas from B.C.’s northeast and cool it to -162 C — about 1/600 of its previous volume — for shipment via tankers. 

When it reaches its destination, LNG can be converted back into gas for redistribution through pipelines where it’s used for heating, electricity and industrial production. 

Cedar LNG proposes to produce between three and four million tonnes of LNG annually, enough to fill 40 to 50 LNG carriers. 

These carriers, as long as six football fields, will travel to Cedar LNG using a shipping route that begins in the Hecate Strait and passes into the Browning Entrance, where a specialized pilot will navigate the Douglas Channel and moor the vessel near Kitimat.

The facility would also have the capacity to store 250,000 cubic metres of LNG in tanks also floating on site.

3. Does Cedar LNG have anything to do with the Coastal GasLink pipeline?

edar LNG’s plan is to receive gas from the Coastal GasLink pipeline.

The project description notes that “natural gas will be delivered to the Cedar LNG Project Area by a 20-inch diameter, approximately eight-kilometre-long pipeline.”

Coastal GasLink, a subsidiary of TC Energy (formerly TransCanada Pipelines) says it is building the pipeline for the LNG Canada project — the only LNG project of the seven proposed in B.C. that is currently under construction — which is located on Haisla territory. 

4. Why does the Haisla Nation want its own LNG terminal?

The Haisla note that significant industrial development has taken place on Haisla land, but without the nation’s ownership.

Cedar LNG “is a key element of the Haisla Nation economic and social development strategy and will further advance reconciliation by allowing Haisla Nation to — for the first time ever — directly own and participate in a major industrial development in its territory,” the nation writes in the project description.

Cedar LNG is viewed by the community as a pathway toward “economic reconciliation” for the Haisla Nation in keeping with B.C.’s new legislation to implement the UN Declaration on the Rights of Indigenous Peoples, which  states Indigenous communities have the right to “determine and develop priorities and strategies for the development or use of their lands or territories and other resources.”

Profits from the project, anticipated to create 350 to 500 jobs at peak construction, would be invested in the Haisla community. Once operating, the project would employ 70 to 100 people full time. 

The land and water lot proposed for the location of Cedar LNG are within the asserted traditional territory of the Haisla Nation. 

The Haisla Nation was unable to provide comment by time of publication.

5. What are the climate impacts of Cedar LNG?

The climate impacts of LNG are significant — LNG Canada is set to become B.C.’s single largest source of emissions.

In order to cool natural gas to a temperature where it liquifies, LNG plants need to power massive compressors. 

The full climate impacts of an LNG operation are determined in part by how those compressor units are powered. 

Cedar LNG says if power can be obtained from the BC Hydro grid, the project will create 186,000 tonnes of emissions per year. That’s the equivalent of putting more than 40,000 passenger vehicles on the road for one year.

But, if the project is required to self-generate power from natural gas, that figure jumps to an annual estimate of 840,800 tonnes, the equivalent of more than 180,000 vehicles on the road for a year.

And that’s before the upstream climate impacts of natural gas extraction from fracking — including the release of methane, a potent greenhouse gas — are considered.

In a submission during the public comment period for the project’s exemption from federal review, the Wilderness Committee called into question the methodology used to tabulate Cedar LNG’s emissions.

“Wilderness Committee also questions the methodology of the proponent in detailing only the greenhouse gas emissions generated at the Cedar LNG facility while ignoring the significant methane emissions of increased fracking activity required to supply the project,” states the submission by climate campaigner Peter McCartney and conservation and policy campaigner Charlotte Dawe.

Using a shale scenario tool created by the Pembina Institute, McCartney and Dawe calculate the gas feed for the Cedar LNG project would require 5,276 new wells to be fracked in northeast B.C. over the next 30 years.

Based on that calculation, McCartney and Dawe found the upstream emissions (those resulting from producing the natural gas) associated with the Cedar LNG project would be 997,050 tonnes — or, they write, “close to six times the projected emissions of a grid-powered facility.”

6. Are there other environmental concerns with Cedar LNG?

In the company’s project description, the Cedar LNG site area is characterized as coastal coniferous forests and deep marine waters that are home to a wide variety of wildlife species.

Species of conservation concern have been documented in the area as well, including the grizzly bear, western screech owl and coastal tailed frog. 

The Wilderness Committee notes it is concerned about “the site footprint’s overlap with critical habitat for the endangered marbled murrelet.” The group notes that under normal circumstances under Canada’s Species At Risk Act, “any federally reviewed project that would adversely impact critical habitat requires further environmental review to determine if these impacts are significant.”

At the proposed location of the floating terminal, kelp and eelgrass provide important seasonal habitat for fish. Species such as salmon, herring and eulachon pass through during spawning season. Whales and sea lions also commonly reside in the Douglas Channel. 

In another submitted comment, the conservation group My Sea to Sky notes dredging and construction of the Cedar LNG project is likely to have significant marine impacts.

“The project will impact marine life, both in the Douglas Channel and on the west coast of B.C.,” the group writes. “This includes near-shore noise and water quality effects on cetaceans and local herring-spawn and salmonid-spawning areas, along with effects of noise and tanker traffic on endangered northern resident and transient orca populations.”

Cedar LNG’s description notes the plant’s continuous noise and light levels will likely cause sensory disturbance and displacement to wildlife.

7. Why isn’t the Cedar LNG project undergoing a federal environmental assessment?

In August 2019, Cedar LNG submitted basic project descriptions to both the provincial (the British Columbia Environmental Assessment Office) and federal governments (the Impact Assessment Agency of Canada).

In September, B.C. asked the federal government for permission to substitute a provincial environmental assessment for the federal one. 

The federal government in turn requested Cedar LNG submit a summary of the available project information to determine whether a full federal impact assessment was necessary. The federal government also held a one-month public comment period from late September to late October 2019. 

In January 2020, the federal government approved B.C.’s request for a substituted process. 

During the public comment period, a number of Indigenous nations and conservation organizations expressed concern that the project will not undergo a federal review, especially given that the floating LNG facility will affect the ocean — an area monitored and regulated by the federal government.

A spokesperson for the Impact Assessment Agency of Canada told The Narwhal via email that certain conditions have been set by the federal minister for the province to assess, including requirements the province assess greenhouse gas emissions and the potential effects of marine shipping activities.

In an email to the Narwhal, a spokesperson for the Ministry of Environment and Climate Change Strategy wrote that if the project moves ahead to construction, it will “have regulatory oversight from various provincial and federal government agencies with appropriate expertise.” 

8. How will Cedar LNG affect air quality and human health in Kitimat? 

The B.C. government claims that “with proper management, Kitimat’s airshed can safely accommodate new industrial growth.”

Local resident Lis Stannus said she is concerned about the cumulative air quality impacts of increasing industrial facilities in Kitimat, especially after a modernization project that increased the sulphur dioxide emissions from the Rio Tinto smelter. 

“The Cedar LNG project is now the third LNG project under proposition in the Kitimat Valley and these projects are in addition to Rio Tinto’s existing aluminum smelting plant,” Stannus wrote to the federal government in a submission.

She pointed out that the emissions from the Cedar LNG project seem disproportionately high for the size of the project and added that “residents of Kitimat and surrounding areas have higher rates of asthma and respiratory related illness than the B.C. average.” 

The Metlakatla Stewardship Society voiced similar concerns, noting the airshed currently has above-threshold emission levels from existing industry. 

The Ministry of Environment told The Narwhal that the air quality impacts of the Cedar LNG project will be assessed and that any assessment undertaken will consider both existing and foreseeable projects in the Kitimat airshed. 

There are also concerns associated with the increase in fracking the project would require. 

Two physicians on behalf of the Canadian Association of Physicians for the Environment (B.C.) submitted comments referencing recent studies that show higher incidences of respiratory disease, cancers and illness in newborn babies close to fracking operations in the province. 

Also weighing in on the climate crisis, the physicians pointed out that Canada has not reduced its carbon footprint over the past 20 years and that the Cedar LNG project will make reaching greenhouse gas targets more difficult.

“Building more LNG facilities will make this goal impossible,” they said.

9. Is there a market for Cedar LNG?

In the Cedar LNG project description, the Haisla Nation said the facility will serve growing demand for LNG in Asia and Europe, as many countries transition off coal.

“Over the last decade, global demand for LNG has steadily increased in Asia and Europe. According to British Columbia’s Natural Gas Strategy, this growth is expected to continue as countries pursue alternatives to diesel and coal to support cleaner electricity generation, heating and transportation requirements.”

But overproduction, warmer winters and now the COVID-19 pandemic have dramatically impacted the global LNG industry, with pricing hitting unprecedented lows.

As The Narwhal recently reported, at least 10 global LNG projects, including projects from Australia to Senegal, have been put on hold over the past month due to coronavirus and clogged supply chains. 

And there’s no guarantee LNG will displace coal. As the Pembina Institute has pointed out, LNG from B.C. would also have to compete with low-carbon sources of energy, including nuclear, hydro, solar and wind.

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