The Haisla First Nation and LNG Partners of Texas have created a unique partnership to build a small-scale liquefied natural gas (LNG) export facility on the northwest coast of British Columbia.
The Haisla First Nation and a Texas-based company have created a unique partnership to build a small-scale liquefied natural gas (LNG) export facility on the northwest coast of B.C.
“It’s what our people have always wanted — to be treated as equals in business,” said Haisla Nation councillor Ellis Ross. “Inclusion in this type of project goes a long way. We have been excluded from the economic development of our land for the last 60 years.”
The Douglas Channel Energy Partnership is a 50/50 joint venture between the Haisla Nation and LNG Partners of Houston.
The partnership is proposing to construct and operate a liquefied natural gas export terminal at Bish Cove near the Port of Kitimat.
“The proponent came to us, even before they went to the Crown and said we want to do business with you,” said Ross.
“In the past, the proponent provided a project description and applied for certification from the Crown, which notified the First Nation group impacted by the project. An agreement was then set up to accommodate and consult on title and rights.”
The partnership is based on direct negotiations without government involvement.
An agreement between Rio Tinto Alcan and the Haisla Nation was ratified in February 2010, which defined a land transfer process to support Haisla development initiatives.
“The Haisla will be the landlord and the owners, taxing authority and full business partners on this project,” said Ross.
“This new project will be on ‘fee simple’ or privately owned land. This is not reserve land. The land is owned by Alcan and will be sold to the Haisla Nation.”
According to Ross, this is one of the only agreements in Canada that addresses the impact of both new and existing projects.
Ross considers the transfer of land from Rio Tinto Alcan to the Haisla to be compensation for the unjustified infringement of Haisla rights and title interests.
Alcan completed its Kitimat aluminum smelter in 1954, which was the largest engineering and construction project ever undertaken by a private enterprise in Canada.
The facility was located in traditional Haisla territory and resulted in a rapid increase in the local population.
“When industry started impacting our territory, everybody benefitted from this development except for the Haisla nation,” said Ross. “But things are starting to change.”
The proposed LNG terminal will take delivery of gas via a pipeline, about 15 kilometres long, from the Pacific Trail Pipelines.
It will be connected to the existing Spectra Energy’s Westcoast Pipeline system.
The proximity of the terminal to the existing natural gas transmission infrastructure is one of the advantages of this project, and ensures supply has easy access to the terminal.
The partnership recently applied to the National Energy Board for a license to export LNG from a point on Douglas Channel for a 20-year term.
The project involves the construction of a shoreline LNG tanker berthing and uploading jetty, tug boat berth, several pipelines and the upgrading and extension of the access road.
The construction cost for the terminal is between $360 million and $450 million. It could be completed as early as 2013 and move about 125-million-cubic-feet-a-day.
Members of an export co-operative would be charged a fee for the movement of the liquefied gas.
The gas would be exported to Asian markets in China, India, Japan, South Korea and Taiwan, as well as other potential markets in the Pacific Rim.
Last month, Encana Corporation bought part ownership in another proposed LNG export facility in Kitimat.
The proposed $4.2 billion project involves the construction of a 36-inch diameter natural gas pipeline.
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