Focus on Fuel Part III: The ecological imperatives of the B.C. LNG industry

Features Series

Fuel_featured_intextFor part two of this series, click here: Focus on Fuel Part II.


This is Part III in a five-part Martlet investigative series exploring the economic, socio-political, and environmental impacts of the B.C. government’s decision to pursue Liquefied Natural Gas initiatives. This instalment focuses on examining environmental considerations around the issue.


As Christy Clark’s government pushes ahead with its plans to develop “the world’s cleanest LNG industry,” which is a central component of Clark’s “Debt Free B.C.” platform, many are feeling compelled to support the development of this particular natural resource solely on economic grounds. With Clark’s promises to develop this potential “trillion dollar industry ” in British Columbia, it is easy to get caught up in the fiscal prospects inherent in Liquified Natural Gas (LNG) and ignore the potential consequences of such a recourse to economic development. Compared with Alberta’s tar sands, and the proposed Enbridge and Keystone XL pipelines, British Columbia’s emerging LNG industry has received relatively little public attention as of late, although the controversy over unconventional extraction methods (such as hydraulic fracturing, or “fracking”) has begun to garner more attention in environmental advocacy circles recently. Some individuals, such as Ben Parfitt, Resource Policy Analyst for the Canadian Centre for Policy Alternatives, claim that this delay in criticism regarding LNG in B.C. is primarily due to LNG’s euphemistic designation as the “cleanest” of all fossil fuels; after all, who could argue with energy that is both economically and environmentally expedient to produce? Yet many eco-analysts, such as Parfitt and intellectual heavyweight David Suzuki, posit that the public might be intentionally misled via euphemisms and distorted data, ultimately for the sake of the accumulation of capital by foreign multinational corporations. If the economic prospects of the LNG industry in British Columbia are less than certain, these analysts contend that the extensiveness of the environmental consequences of such development are even more so.

FRACK OFF!: The LNG Production Process

Globally, natural gas has the third highest consumption rate as an energy source, only falling short of coal and liquid fuel (such as petroleum) as an energy alternative, while accounting for significantly more energy consumption than renewable and nuclear energy sources combined. Traditionally, natural gas is extracted from porous pockets in the ground through a vertical well and the gas is then transported to off-site processing locations via pipeline; this method of extraction is termed “conventional” in the industry. Through recent industrial innovation and methodological evolution, “unconventional” extraction methods have opened up vast reserves of previously unobtainable natural gasses, with some estimates citing a tenfold increase in accessible natural gasses in North America as a result of these newfound processes. These “unconventional” extraction methods typically involve a combination of horizontal drilling and hydraulic fracturing (“fracking”). Horizontal (or, “Directional”) drilling allows for increased exploitation of natural gas reserves because in drilling non-vertical wells, gas companies can follow a rock layer, essentially providing access to larger fields of natural gas without drilling more well pads on the surface. Fracking is the process whereby “slick water” is pressurized and injected into rock formations (mostly shale) via a directional well to fracture the rock and release natural gasses, which can then be harvested by the gas company working on the project. It was the combination of these two industry innovations which accounts for the continuing glut of natural gas in North America and the corresponding desire for North American national and provincial governments to find a release for this gaseous gold.

Traditionally, the potential for natural gas as an exported commodity was limited only by the geopolitical location of the production sites; due to its gaseous state, it was very rarely transported to sites that could not be reached via pipeline. The liquefaction process, inaugurated by the German engineer Karl Von Linde in 1873, revolutionized the energy industry and the consumption of natural gas was no longer limited to political entities that could be reached by pipeline. The first liquefaction plant was established in West Virginia in 1912. By 1959, the first tanker laden with LNG, The Methane Pioneer, had arrived on the coast of the United Kingdom, marking the first safe trans-Atlantic voyage for this commodity. In the decades following this historic voyage, the global production and consumption of LNG exploded, with figures suggesting a current production capacity of roughly 290 million tonnes by 2013. Yet for all the energy markets that LNG has opened up for business, it has made up for in its energy-intense production. To arrive at LNG from its gaseous state, it is necessary to subject the natural gas to a process of liquefaction, where it is cooled to -160ºC, effectively reducing the volume of the gas over 600 times. In the process the natural gas, which is a mixture of methane and low concentrations of other hydrocarbons, water, carbon dioxide, nitrogen, oxygen and some sulfur compounds, is divested of the majority of these hydrocarbons, leaving a liquid which is mostly methane and about half the weight of water after all is said and done. The final product, LNG, is then paradoxically heralded as “green fossil fuel” and shipped off to Asia thanks to the financial and legal impetuses provided by heads of state such as Christy Clark.

British Columbia’s Environmental Commitments

A major talking point for the Clark administration when pushing for the creation of an LNG industry in British Columbia was its capability not only to generate significant revenue for the province, but its ability to decrease Greenhouse Gas (GHG) emissions on a global scale. Just how exactly is replacing one fossil fuel with more of another fossil fuel going to decrease GHG emissions globally? The logic goes something like this: by replacing the coal and petroleum used in the burgeoning Asian economies that have infatuated the West with LNG, which has the capability to burn roughly twice as long as coal, emerging fuel economies can continue to grow yet without leaving such a significant carbon footprint. Yet critics such as those at the David Suzuki Foundation have suggested that there is no evidence that LNG will replace these other energy sources in Asia and will in all likelihood merely supplement them, leading to a net increase in GHG emissions, rather than to their prophesied decline. Furthermore, in a country like Japan, which is experiencing energy shortages as a result of the recent Fukushima debacle, replacing nuclear fuel with LNG would actually increase net carbon emissions. Clark’s promises to combat global GHG emissions also fail to take into account increased emissions in B.C. as a result of the opening of the five proposed LNG facilities throughout the province, which is especially troubling when one considers the various provincial, national and international pacts regarding GHG emissions on which B.C. is a signatory.

The environmental legislation most cited by critics as an obstacle for the Clark administration’s aggressive pursuit of a B.C. LNG industry is the Greenhouse Gas Reduction Targets Act of 2007 (GHGRTA). The GHGRTA is an act in which British Columbia legally committed itself to bringing its GHG emissions to progressively decreasing levels. The GHGRTA mandated that by 2020 GHG emissions in the province must be 33 per cent lower than the GHG levels in 2007 and by 2050 these levels must be at least 80 per cent lower than this baseline number. The act also mandated the establishment of interim goals for the province, set at 6 per cent for 2012 and 18 per cent by 2016, a goal the province barely last year and is unexpected to be met in 2016, should the Clark administration forge ahead with their plans for a British Columbian LNG industry. In addition, B.C. has also dedicated itself to Western Climate Initiative (WCI), the Pacific Coast Collaborative (PCC) and the International Carbon Action Partnership (ICAP), all of which commit B.C. to lowering its GHG emissions through various legal and economic measures.

According to a recent report by Clean Energy Canada, an initiative launched by TIDES Canada, the goals set forth in the GHGRTA and other partnerships of which B.C. is a member are impossible to meet without serious policy recalculations. According to TIDES, it is imperative that the Clark administration explicitly addresses how the energy needs of the LNG liquefaction facilities will be met and how the CO2 released during the extraction and processing procedure is managed. According to analysts at the David Suzuki Foundation, should the Clark government proceed with the planned construction of the first five LNG facilities, the energy needs of the province would rise about 30 per cent; it is now ostensible why the question of how this massive increase in energy demand will be met is of utmost importance to critics of the Clark agenda.

Additionally, Christy Clark originally unveiled the impending British Columbian LNG industry as the “cleanest in the world,” a goal which analysts at TIDES cite as incredibly unlikely. According to their estimates, an “off-the-shelf” plant in B.C. could have carbon dioxide emissions of up to 0.96 of a tonne of carbon dioxide per tonne of LNG produced, versus 0.33 of a tonne C02 for the Statoil Snohvit project in Norway and Australia’s Gorgon project. Worries that the Clark administration would be unable to live up to its promise of producing the cleanest LNG in the world were exacerbated following B.C.’s Minister of Energy and Mines Rich Coleman announcement in July of 2012 that British Columbia’s Clean Energy Act had been updated to enable the use of natural gas to power liquefied natural gas (LNG) plants. This means they are excluded from the act’s 93 per cent clean and renewable energy requirement. This move was in direct contradiction to the 2012 B.C. Climate Action Plan, which stated that it was anticipated that B.C.’s first two LNG plants would use clean electricity, which would “result in lower emissions than plants elsewhere in the world.”

COMING DOWN THE PIPE: B.C. LNG Facilities Currently In the Works and The Export Approval Process

The Halloween announcement of an LNG export application filed by Triton LNG Limited Partnership, a 50-50 partnership between a Canadian and a Japanese energy company, marks the latest addition to four other pending export projects, which are expected to supplement the three LNG facilities already approved for 20-year or 25-year export licenses by the Environmental Assessment Office. The vast majority of these projects are the brainchildren of foreign multinational corporations and Canadian companies represent a small minority in the various partnerships; so far, the list of companies which have filed for or have received approval for exports looks something like this: Altagas (Canadian), Idemitsu (Japanese), PETRONAS (Malaysia), Progress Energy (Canadian), BG Group (Britain), Golar (Bermuda), Chevron (American), Apache Corp. (American), Shell (Dutch), KOGAS (Korea), PetroChina (China) and Mitsubishi Corp (Japanese).  According to analysts for the Dogwood Initiative, a non-profit focusing on British Columbian land and water rights, the surge in applications for LNG export is due in part largely to how Environmental Assessments, which ultimately determine whether an application for export is approved, are processed. There are four ways to conduct an environmental assessment: screenings, comprehensive studies, mediation, and panel reviews.

The process of applying for an Environmental Assessment certificate is pretty straightforward. The interested parties approach the Environmental Assessment Office (EAO) with the proper documentation establishing the scope and method of their proposed project. The EAO then takes this proposal, establishing a working group comprised of representatives of affected First Nations and various government agencies. If the application is then accepted, the EAO has 180 days to deliberate on it, and is required to post the application online for the public and to hold at least one public hearing in regard to the project. The EAO director then provides the application to the Minister of Environment and another unspecified minister who are given 45 days to make a decision on whether or not to grant the interested parties an Environmental Assessment certificate. According to analysts at the Dogwood Initiative, the vast majority of Environmental Assessments are screenings, which involve minimal public input, and as a result, the vast majority of environmental assessments are approved.

LNG: The ‘Clean,’ ‘Green’ Burning Machine

Last month the Clark administration announced the Kitimat Air Shed Impact Assessment Project, a $650 000 attempt to assess the impact of sulphur dioxide and nitrogen dioxide emissions from the proposed LNG projects in the Kitimat area. This project was announced following reports by a Cornell University team led by Robert Howarth and a study conducted by Mark Jaccard for Simon Fraser Univeristywhich both called into question the nomenclatural designation of LNG as the “cleanest” fossil fuel in the world.

The Howarth study focused primarily on methane release at shale well sites, as opposed to traditional well sites and found emissions to be up to 190 times higher at shale well sites than at traditional sites; this is quite an astounding figure, but one that pales in comparison to the U.S. Environmental Protection Agency’s estimation of 249 times more methane being released at shale well sites than at traditional sites. Although both studies admit to a quantitative and qualitative lack of data, they are in agreement that methane release at shale gas wells would be significantly higher than at traditional well sites. The Pembina Institute, a Canadian clean-energy think-tank, which analyzed both the Howrath and Jaccard studies, concluded that when all greenhouse gas emissions associated with the prospective B.C. LNG industry are considered, the possible outcome is the doubling of emissions from 2010 levels by 2020.

According to analysts at the David Suzuki Foundation, the air is not the only concern when it comes to considering the impact of an LNG industry on British Columbian ecology. As of this moment, there is over 1100 km of new pipeline planned for the Kitimat and LNG Canada projects , which in itself will result in massive land clearings, and this is without taking into consideration the 6500 wells that will need to be drilled to get four new LNG facilities off the ground. To extract shale gas, one well pad is necessitated roughly every square mile over a shale deposit and each well pad occupies approximately one hectare and can extend between 1,500-6,100 m into the Earth’s surface; after all the necessary pipelines and well pads for these LNG projects are constructed, this will affect and fragment a size of surface land roughly three times the size of metro Vancouver. The estimated number of wells needed to get the LNG industry off the ground is 6500, which is not a static number; once completed, wells will produce for several years, however the production capacity of each well falls rapidly, usually operating at half capacity within three years of its construction.This means the interminable construction of wells in addition to the initial wells needed to get the industry on its feet.

Despite the importance of the land and air, perhaps the most serious concern when debating the ecological imperatives of establishing a LNG industry in British Columbia is how it will affect the water supply. The process of unconventional gas extraction and water use are intimately linked; in order for Hydraulic Fracturing to be possible, the ‘hydraulics’ must be accounted for. In fracking, the most common way to fracture the shale formations is through the use of ‘slick water’; ‘slick water’ is water mixed with chemicals such as Methanol, naphthalene, Hydrochloric acid, benzene, Quaternary Ammonium Chloride and ethylene glycol to increase it fluidity and aid in the fracking process. Many of these fun-sounding chemicals are incredibly toxic, depending on one’s exposure levels, and can result in even more fun-sounding diseases; to take but a few examples, exposure to benzene can lead to leukaemia and aplastic anaemia, exposure to naphthalene can lead to Hemolysis and cataracts, and exposure to Quaternary Ammonium Chloride can result in cyanosis, apnoea and in extreme cases of high concentration exposure, death. These chemicals are deemed ‘safe’ because when drilling a directional well, the well is coated in concrete to prevent contamination of the ground water and are allegedly found in very small quantities in ‘slick water’.

Despite a recent study conducted by Public Health England which denounced significant risks to public health by activities associated with fracking, some critics remain unconvinced of the safety of such practices, such as Ben Parfitt, who spoke at the recent PowerShift B.C. conference on the subject, and noted, “This water [used by the industry] becomes so toxic, that in Fracking operations in Pennsylvania, where it is collected and transported to municipal waste water plants for treatment, was actually damaging the water purifying infrastructure.” According to Parfitt, if municipal treatment facilities cannot standup to the corrosive slick water, there is no indication that concrete coated wells will prevent it from contaminating ground water supplies in the future.

Unconventional gas extraction is notorious for its high water consumption, something which critics like Parfitt are quick to point out is nearly unregulated in British Columbia, a legal shortcoming which further exacerbates the problem of rampant water consumption by the industry.  According to the David Suzuki Foundation, roughly 120-million litres a day would be required to sustain B.C.’s proposed LNG industry, the equivalent of satisfying the daily water needs of a city of about 160,000 or emptying five Olympic swimming pools. Despite this astounding amount of water used daily by the industry, the water consumption of companies involved in extracting the gas is largely unmonitored and untaxed.

The Oil and Gas Commission (OGC) recently became the only regulatory body outside the Water Stewardship Branch (WSB) with the ability to grant one-year Section 8 water-use permits in B.C., meaning that the oil and gas industry is the only industry in British Columbia who does not obtain their water rights exclusively through the WSB. Interestingly enough, the OGC does not charge oil and gas companies anything for water use rights as compared to the WSB, which does levy a fee for water usage. Even before the OGC received the authority to dispense water rights to oil and gas companies, the WSB charged only a minimal rate for water usage—$1.10 per thousand cubic metres of water used. According to Parfitt, this lack of cost associated with water use provides the industry with further incentive to squander this precious natural resource.

Putting the ‘Eco’ back in Economics: Policy Recommendations for the B.C. LNG Industry

Whilst delivering an impassioned keynote speech to a captivated audience at the recent PowerShift B.C. conference in Victoria, David Suzuki issued an ultimatum for environmentalists everywhere. “[The politicians] elevate the economy above the very atmosphere that sustains us. The economy comes, in our lives now, above everything else,” said Suzuki. “Let’s put the ‘eco’ back into economics, where it belongs.” Like any good rabble-rouser, this ultimatum was not unaccompanied by policy recommendations. Analysts at the Pembina Institute, the Dogwood Initiative in collaboration with individuals such as Suzuki and Parfitt have individually issued policy recommendations for Clark’s LNG projects to ensure that they are ecologically sustainable in addition to economically sound investments.

According to analysts at the Dogwood Initiative, it is imperative that citizens have a greater voice in the Environmental Assessment process.  Due to the fact that the vast majority of Environmental Assessments are performed as screenings, citizens have very little voice in the procedure. In order to allow equal representation of interests in such project, the citizenry must demand that the Environmental Assessment Office also utilize other assessment methods, such as panel reviews and comprehensive studies which would allow local lay folk to have a much larger say in an industry that threatens to fundamentally alter their daily lives. Furthermore, these environmental assessments treat projects in isolation, and as such are inaccurate when it comes to providing evidence for the cumulative ecological impact of several projects operating in concert.

The Pembina Institute issued four policy recommendations for helping B.C. meet its emission goals while still opening the proposed LNG facilities. The first is that B.C. must reduce the amount of natural gas consumed in extracting and producing LNG; it appears as though B.C. is already violating this recommendation by lifting its requirement for the use of 93 per cent clean energy at the LNG facilities. The second recommendation is intimately tied to the first in its call for cleaner energy used in the production and extraction of natural gas; as already noted, B.C. is not making good progress toward this recommendation, however Pembina offers some policy solutions to provide the clean energy B.C. must utilize at its plants if there is any hope of meeting its decreased emissions goals. Recommendations include using solar or wind powered electricity on site, or even the possibility of connecting to B.C. Hydro’s power grid, although the analysts note that this could generate significant controversy when it comes to powering the larger LNG facilities. The third policy recommendation is ensuring that minimal amounts of GHG reach the atmosphere during the production and extraction of LNG; this could be ensured through the use of Carbon Capture and Storage technologies, which are becoming more prevalent in the industry. The fourth and final recommendation issued by Pembina is putting a cap on the annual production of LNG, to insure against its rapid depletion. This appears to be the last thing on the Clark administration’s mind as export applications continue to be approved, projected revenues from LNG continue to soar and government ministers continue to deny favoring economy over ecology.

We are committed to balancing the need for resource development with environmental protection,” said Mary Polak, B.C.’s Minister of Environment in a recent press statement. Only time will lend validity to such assertions and show just how many of these policy recommendations are taken seriously by the administration. Whether or not the government will take these suggestions into consideration is left to reader speculation by this journalist and the analysts from these various institutes, yet they all agree on one fundamental point: it is imperative that the citizenry exert pressure on their government to ensure ecologically responsible behaviour from those in the British Columbian LNG Industry.