CALGARY – Federal Natural Resources Minister Joe Oliver says Canada risks missing the boat if it doesn’t get its act together soon and take advantage of long-term opportunities in liquefied natural gas exports.
“All of Canada’s natural gas exports are currently to the United States, a country that will require less Canadian gas in the future,” said Oliver, in a speech to the Canada LNG Export Forum Thursday.
“Therefore we must reach new markets in countries that urgently need energy to generate revenue for critical Canadian social programs like health and education.
There is already serious competition from both Australia and the United States in markets such as China, India, South Korea and Japan, Oliver said. Further delays getting overseas could be costly for Canada, the world’s fifth-largest natural gas producer.
“Critical decisions must be made and a clear direction set and make no mistake — this moment, this opportunity will not last forever and it does not exist just for us,” he said.
Oliver said unconventional technology is allowing the United States to gain greater access to its natural gas reserves, with 20 new projects currently under consideration. Australia has already approved seven new gas projects and has seven more under review, said Oliver noting Australia has the advantage of being close to the Asia Pacific market.
A number of multibillion-dollar projects are in the works to chill natural gas from northeastern B.C. into a liquid state and ship it across the Pacific. But there are outstanding issues that need to be worked out such as a royalty regime that would promote the establishment of an liquefied natural gas industry, labour shortages and managing environmental risks brought on by increased West Coast tanker traffic.
“There is an issue because these are long-term contracts and that’s why we can’t wait forever. The resources are in the ground. It doesn’t mean that if we wait for a while we can find a ready market,” Oliver said after his speech.
“Clearly in our national interest to move as quickly as we can to get the resources to market.”
Oliver’s position echoes that of former Conservative cabinet minister Jim Prentice, who addressed the forum on Wednesday.
Canada needs to “push ahead with a much greater sense of urgency,” or risk having Asian buyers seek supplies from competitors, he said.
The Conference Board of Canada estimates that natural gas production in Canada will add another $576 billion to the economic between 2012 and 2035.
The Canada LNG Forum is being attended by major energy stakeholders, global industry leaders, members of government, Asian and European buyers, exporters and investors.