LNG glut dims outlook for new plants

Coleman confident B.C. will be competitive despite low prices, challenges flagged in natural gas forecast

A new forecast of global natural gas demand paints a gloomier picture of the prospects for the launch of a major new LNG industry in B.C.

A new report suggests the odds are getting longer for the B.C. government’s dream of opening several liquefied natural gas export plants.

The International Energy Agency warned a flood of new LNG supply is coming onto the market and new plants will struggle to get off the ground.

“Several projects have already been scrapped or postponed, and the number of casualties will rise if prices do not recover,” said the IEA’s medium-term gas market report.

The IEA cut its LNG growth forecast from 2.3 to 2.0 per cent a year.

It noted the 17 new LNG projects already under construction will come on stream as planned and run flat out in an attempt to recover as much of their sunk costs as possible, further adding to the supply glut.

But new plants that aren’t yet approved will become harder to justify.

“Today LNG prices simply do not cover the capital costs of new plants.”

Natural Gas Development Minister Rich Coleman said he’s aware of the short-term challenges outlined in the report.

The province last month signed a long-term agreement with LNG proponent Pacific Northwest LNG assuring the $36-billion Petronas-led project of royalty and tax stability in B.C.

“Clearly some of the largest companies in the world see the value in building a LNG industry in B.C.,” Coleman said in a statement emailed by his office.

“The fact is, LNG projects have lifespans of 30-50 years. So proponents are looking at the long-term economics when deciding the viability of a project . Many analysts are forecasting that B.C. LNG will be competitive over the long-term. We share that view.”

Just Posted

North Road proposal draws heat

Public meeting to address Canfor request

First farmers market fosters a sense of community

Vendors and customers alike excited for return of market

Chief Dr. Robert Joseph awarded Order of Canada

An inspiration and role model for all Canadians

Workshop to help businesses find that perfect employee

Selling location and lifestyle one strategy for success

National ecology expert holds workshop in Fort St. James

Use of natural materials vital for environmental restoration

Police release video on how to ‘run, hide, fight’ if there’s an active shooter

Vancouver police offer video with input from E-Comm, BC EHS, Vancouver Fire and Rescue

Horgan defends fight to both retain and restrict Alberta oil imports

Alberta says pipeline bottlenecks are kneecapping the industry, costing millions of dollars a day

RCMP caution boaters after two kids pass out from carbon monoxide poisoning

Both children were given oxygen and taken to hospital

Barkerville opens for the season

Highlights of Barkerville’s upcoming season include 150th Dominion Day and pack train re-creation

B.C. invests $115M to create 200 new nurse practitioner jobs

Health Minister says 780,000 B.C. residents don’t have a family doctor

Supreme Court rules social housing residents in B.C. deserve rights too

Tenants trying to stabilize their living situations should not face less legal rights than those paying market rates: Judge

Union calls on prime minister to step into ‘stalled’ Phoenix compensation talks

For more than two years, thousands of federal workers have been affected by Phoenix system

Judge: President Trump can’t block critics on Twitter

The judge had suggested that Trump mute rather than block some of his critics

NFL owners adopt new policy to address anthem protests

Commissioner Roger Goodell said the change was approved unanimously by owners

Most Read