Will Petronas change its development plans to protect Flora Bank?

Since the Canadian federal government approved the Pacific Northwest LNG project at the mouth of the Skeena River last September, a combination of legal action by salmon advocates, public pressure, and market forces have stalled the project. Petronas, the lead partner on the project, is reportedly seeking a new site for the LNG liquefaction and export terminal, which was slated to be built over the Skeena’s most important juvenile salmon nursery, on Flora Bank.  We caught up with our local partner Greg Knox, executive director at SkeenaWild, to get the latest developments.

What’s the latest on gas development at the mouth of the Skeena, on Lelu Island and Flora Bank?

The Pacific Northwest LNG project is undergoing a full project feasibility review by Petronas and its partners to try to reduce construction costs, explore alternate designs and sites, and see if it is economically viable.

How serious is the developer about moving away from this sensitive area  ̶  how will we know it’s for real? 

I believe Petronas is serious about moving the site (or just the offloading facility), for the following reasons:

• When First Nations and community groups forced them, through the federal environmental assessment process, to redesign the offloading facility in 2015, this added at least a billion dollars in costs to the project. When they did test drilling for the bridge pilings on Flora Bank and nearby Agnew Bank, they had to drill very deep to reach bedrock and this dramatically increased the estimated costs for the offloading facility  ̶  up to $5 billion. They can significantly reduce these costs if they move the offloading portion of the project over to Ridley Island.

• They see our legal cases as a serious risk to the project. Senior officials at Petronas have been reaching out to salmon advocate to test out their willingness to drop resistance to the project, if the site is moved.
• Petronas’ CEO is for the first time openly talking about moving the facility. This option became real when Shell announced a couple of months ago that their LNG proposal (formerly BG’s proposal) on nearby Ridley Island was being cancelled. This has opened up discussions and negotiations between Petronas, Shell, and the Port Authority for Petronas to take over the Ridley site.

We will not know whether this is “for real” until Petronas makes a public announcement and applies for a new environmental assessment permit with the federal government. In the mean time, we continue our fight in the courts, and are ramping up our efforts to stop them from building over top of critical salmon habitat.

Are there still risks to the estuary even if this development moves to Ridley Island? 

There would still be risks to the estuary if they moved the facility to Ridley, but they would be significantly reduced. We will be working through the new environmental assessment process to assess these risks.

How would new leadership by NDP following recent BC elections affect the Skeena and oil and gas development?  And the Liberals remaining in power?

The NDP have stated that the Lelu site is too risky unacceptable, and have committed to working with parties and Petronas to find a new site (i.e. Ridley), if they take leadership.

The Liberals mean the status quo  ̶  they will continue to do everything in their power to make PNW LNG happen regardless of any changes and to push LNG at all costs.

What’s the future for the estuary  ̶  how do we keep it protected over the long term?

We have to get Petronas off of Lelu Island and Flora and Agnew Banks. Once successful, we can move into pushing for some form of permanent protection and estuary management planning.