Jump to content
  • Sign in to follow this  

    Subsidizing climate change


    Russ Francis

    LNG Canada’s lobbying wins $6-plus billion payout.

     

    ONE BILLION DOLLARS A YEAR. Not many departing employees can boast of bringing in that much for their employer. In an April 9 statement, Andy Calitz reported that his six years as CEO of LNG Canada had been “extremely rewarding.”

    No kidding. Just five days earlier, on April 4, BC NDP and Liberal MLAs consummated a temporary fling by passing Bill 10, the Income Tax Amendment Act. The bill finalized a $6 billion giveaway of taxpayers’ money to a gaggle of large, wealthy foreign carbon-spewing companies for a liquefied natural gas (LNG) project in Kitimat. Only the three Green MLAs—Andrew Weaver, Sonia Furstenau and Adam Olsen—stood against this generous handout. South African-born Calitz ends his CEO position July 1 this year, when he returns to Royal Dutch Shell, which is joining PETRONAS, PetroChina, Mitsubishi and Korea Gas in the LNG Canada partnership to build the $40-billion Kitimat plant.

    How did this unprecedented payout happen? Whatever else one thinks of Premier John Horgan, Environment Minister George Heyman, and other cabinet ministers, they are far from stupid. So why on Earth is the NDP still vigorously pushing LNG in the face of recent, truly terrifying updates to the looming climate catastrophe? Has the premier already forgotten that just a few months before his giveaway bill won royal assent, in November 2018, the Camp Fire in Northern California killed 85 people and destroyed a town—in what used to be called the rainy season? That wildfires have started incinerating suburbia? Does Horgan believe that Kitsilano, Oak Bay and the legislative precinct are somehow immune from what David Wallace-Wells—the author of the recently-published The Uninhabitable Earth—called the “cascading chaos” of climate change? Wrote Wallace-Wells: “[Climate change] can upend and turn violently against us everything we have ever thought to be stable.” And did Horgan miss the April 1 warning from those wild-eyed, radical scientists at Environment and Climate Change Canada that the country is warming twice as fast as the rest of the world? That Yukon and the rest of northern Canada are heating up approximately three times as fast?

    Green leader Weaver attributes BC’s pro-LNG decision in part to lobbying by the industry. Sure enough, the BC lobbyists registry appears to bear out Weaver’s suspicions. Within three months of the July 18, 2017 swearing in of the NDP government, LNG Canada CEO Andy Calitz registered to lobby Premier John Horgan, and Energy, Mines and Petroleum Resources Minister Michelle Mungall, as well as staff of the Finance Ministry and the BC Oil and Gas Commission. Joining Calitz in this quest were five more LNG Canada staff. The lobbying topic: the “LNG fiscal framework and LNG-related carbon management issues.” Translation: Let’s see how much a bunch of wealthy foreigners can extract from BC taxpayers to help wreck what’s left of the planet.

     

    754537360_AndyCalitz.jpg.5f150db2ec5d01bf57bf006cc40b61a5.jpg

    LNG Canada CEO Andy Calitz

     

    On top of the $6 billion in tax and reduced hydro rates are what a whistle-blowing retired government analyst called “an ongoing, eye-watering transfer of the provincial tax burden from natural gas producers to the BC taxpayer.” In his letter to Premier Horgan, read in the Legislature by Weaver, the analyst explained that BC has lost approximately $6 billion in existing and future gas royalties, due to a government program (created by the former Liberal government in 2003 and supported by the New Democrats) that applies to nearly all new wells. According to the whistleblower, each year the government issues more royalty/tax credits than the Crown receives in revenue—handing out $2 in royalty rebates for every $1 it receives in royalties. Of course, this $6 billion goes to every BC gas producer rather than to a single consortium.

    LNG Canada’s lobbying continues. On December 13, 2018, Calitz—along with other LNG Canada staff—re-registered to lobby Horgan and Mungall, as well as government staff.

    The lobbying extends beyond the provincial border. As recently as January 28, 2019, Calitz lobbied senior officials of Innovation, Science and Economic Development Canada. Calitz and other LNG Canada staff also repeatedly lobbied Prime Minister Justin Trudeau, Finance Minister Bill Morneau, Natural Resources Minister Jim Carr, and Fisheries and Oceans Minister Jonathan Wilkinson, among many others.

    In all, LNG Canada participated in 149 written and oral communications with federal officials. All that interaction means the foreign-owned consortium was able to bend the ears and develop influential relationships with Canada’s politicians and bureaucrats.

    The Ottawa lobbying paid off big time: The federal government agreed to waive $1 billion in tariffs on the steel LNG modules, which, like nearly everything about the facility, is imported.

    Just how much will the LNG Canada project add to BC’s emissions? A government technical briefing released October 2, 2018, claimed that two trains (production units) at the LNG Canada plant will result in an increase in BC’s GHGs of 3.45 Mt/year. So the expected four trains mean 7.69 Mt/year in increased emissions, if you accept the government numbers.

    I do not. Taking into account the GHGs emitted during extraction of the gas, fugitive emissions, pipeline losses, and the liquefaction process, each tonne of LNG produced results in 0.94 tonnes of total emissions. Consequently, the 28 Mt/year of LNG from the LNG Canada plant would add 0.94 x 28 = 26.32 Mt/year of additional GHGs in BC. That’s nearly four times the 7.69 Mt annual amount that the BC government is telling us. To put that level of emissions in perspective: It is 39 percent more than the 18.9 Mt/year that last December’s much-ballyhooed CleanBC is expected to save in emissions by 2030, compared with 2007 levels. So without LNG, the government could have scrapped CleanBC and still left the province well ahead. Better yet, it could have kept CleanBC while kiboshing LNG. (And none of this includes downstream emissions, including those from shipping, re-gasification, and ultimately burning. While the government claims LNG will replace coal, there is no guarantee of that. It might well just add to coal emissions, perhaps even replacing or delaying the introduction of renewable energy.)

    Can anything stop BC’s LNG madness? Is this huge contribution to global warming now a done deal?

    The Coastal GasLink pipeline, intended to ship the mostly fracked gas 670 km from Dawson Creek to Kitimat, remains an obvious weak point. In late April and early May (after the Focus deadline), the National Energy Board (NEB) was due to begin hearings in Calgary to deal with a challenge to the pipeline by Smithers environmentalist Mike Sawyer. Though the Province has granted environmental approval, Sawyer argues that the pipeline requires NEB vetting, since it will be connected to an Alberta pipeline. Even if the NEB decides against Sawyer, he has promised to appeal the ruling to the Federal Court of Appeal. In an April 9 update, Coastal GasLink said construction activities are continuing across northern BC, clearing rights-of-way and preparing housing sites for workers. The statement added that pipeline construction was expected to begin in 2020.

    Not if the Unist’ot’en can help it. The Unist’ot’en are affiliated with Dark House, one of 13 hereditary house groups in the Wet’suwet’en First Nation. Last January, members of Unist’ot’en and their supporters blockaded access to a portion of the pipeline route, resulting in 14 arrests. Charges against the 14 included civil contempt. However, on April 15, the Crown announced that there was insufficient evidence for contempt convictions. Coastal GasLink also said it would not proceed. Wet’suwet’en hereditary Chief Madeek told CBC News on April 15 that the fight against the pipeline will continue. “We’re still protecting our territories,” Chief Madeek said. “This isn’t over by a long shot.” On May 12, the Unist’oten will begin its sixth annual construction camp on its territory, building a number of cabins. According to a statement on the camp website: “Following the invasion of our territories by RCMP and industry, we are continuing to reoccupy our lands—helping our people reconnect with, reclaim, and protect our homelands.”

    Despite the assured tone in Coastal GasLink’s April statement, there is no question that owner TransCanada is worried. For one thing, the company is lobbying Indigenous Relations and Reconciliation Minister Scott Fraser. As recently as March 12, several TransCanada lobbyists registered to lobby Fraser and other BC cabinet ministers to discuss the Coastal GasLink pipeline. I’d be surprised if the Unist’ot’en blockades were not the main topic of conversation.

    Another indication as to the company’s state of mind: TransCanada is currently trying to unload a 75 percent share in the pipeline, having hired RBC Dominion Securities to manage the sale, according to the April 9 Report on Business. In my experience, companies do not sell off majority interests in low-risk, surefire money-making ventures—which most pipelines used to be.

    Sierra Club BC senior forest and climate campaigner Jens Wieting said in an interview that the October 2018 report of the Intergovernmental Panel on Climate Change plainly showed that it’s impossible to avert catastrophic climate change while continuing to expand fossil fuel production. “I don’t have a good answer as to why the BC government thinks it’s OK to go ahead with the LNG Canada project,” said Wieting. “It appears that the Province believes that it’s possible to take climate action and build new fossil fuel plants at the same time. The question is whether British Columbians will step up to the plate and face this unprecedented global threat.”

    The provincial and federal governments seem incapable of grasping that we are on an accelerating path towards a hothouse Earth. But many citizens are aware and beginning to feel desperate enough to take action. Witness the Extinction Rebellion Movement taking off in Europe through blockades and now active in Canada. In general, young people are a lot more clued in to the gravity of the situation. On March 15, hundreds of Greater Victoria students left classes to march at the Legislature, calling for much stronger action on climate change. In more than 100 countries, other students held their own rallies.

    Let’s hope they take over the planet before there’s nothing left to take over.

     

    UPDATE

    Not all is well with Fluor Corporation, the Texas-based multinational company leading the US$14 billion project to build the Kitimat plant for LNG Canada. Bloomberg writer Brad Olesen called May 2 Fluor’s “disaster day,” since on that day shares fell 24 percent to US$29.60 on the NASDAQ stock exchange—Fluor’s biggest-ever decline. (On August 3, 2018, Fluor shares closed at US$50.65.)

    Fluor announced a net loss of US$58 million for the three months ending March 31, 2019, compared with a net loss of US$18 million for the same period last year. Also on May 2, Fluor said CEO and chairman David Seaton—who boasted to investors in August 2018 that the LNG Canada project was a “big win” for the companywas stepping down immediately. 

    In its 2018 annual report, also released May 2, Fluor said the LNG Canada project marked the company’s “momentous entry” into the LNG field. Translation: The Kitimat plant is its first such project. Fluor leads the joint venture construction project with JGC, a Japan-based corporation.

    In a May 2 call with investors, interim CEO Carlos Hernandez said that LNG Canada is “on schedule.” On the same call, Hernandez said “we're showing very good [sic] about that project at this point.” Site preparation has been finished, and the project’s Calgary-based managers were working on detailed engineering.

    Also on May 2, shareholder rights law firm Johnson Fistel announced it was investigating potential claims against Fluor for federal securities violations. (US federal securities law prohibits company officers and directors from making false and misleading statements about company finances.)

     

    Russ Francis is a third-generation vegetarian, becoming a vegan decades before the environmental havoc inflicted by the animal industry was widely recognized.

    Sign in to follow this  


    User Feedback

    Recommended Comments

    aimac2@shaw.ca 

    It no longer  seems that our B.C. government is an agreement between NDP and Greens.  It is now a government of NDP and Liberals given licence by the Greens to subsidize global warming by giving away 6 billion of our tax dollars to an LNG industry that can only accelerate our free fall into economic and social destruction brought on by the irreparable destruction of our environment.  What the heck is Horgan's bunch doing!  

    Share this comment


    Link to comment
    Share on other sites

    A very good article but what's up with the vegan signoff? That really takes away from the author's work IMHO. It gives him the appearance of acting holier than thou. Good luck being vegan if you are Inuit. Just saying! 

    Share this comment


    Link to comment
    Share on other sites

    Unbelievable short term thinking fueled by greed. Governments are the number one threat to the survival of the planet Earth.  

     

    "Whatever else one thinks of Premier John Horgan, Environment Minister George Heyman, and other cabinet ministers, they are far from stupid."  

    Physicist Stephen Hawking said pollution coupled with human greed and stupidity were the biggest threats to humanity.

    "Green leader Weaver attributes BC’s pro-LNG decision in part to lobbying by the industry."

    Let me get this straight, all that an energy exploitation company has to do is lobby the government and convince them of what? That further expansion of fossil fuel infrastructure is a good bet for decreasing future climate chaos? 

    The Kitimat LNG project ( the last thing we should be doing is driving more nails into our planets coffin) Site C dam (A downstream environmental disaster in the making)  Shale fracking (unknown effects to geological stability, watershed integrity and accidental emissions) Pipeline expansions (Cheap dirty low quality dilbit exported to burn, better than coal they say? ...hardly)  Providing BC Hydro discounts to mega-corporations (Sure, double the Hydro rates to the taxpayer so you can lure a consortium of greedy energy exploiters with the promise of cheap power to increase their profit margins) Giving away two dollars to receive one dollar (the government issues more royalty/tax credits than the Crown receives in revenue? (Sweet deal for those that get it but why bother if all the environmental damage that is done costs the taxpayers and provides no benefit? Ridiculous) Allowing Imperial Metals to walk away Scot-free from the biggest mining disaster (Mount Polley) in Canadian history (Not only did the government do nothing other than an inadequate cleanup that the taxpayer footed the bill for,  they later provided Imperial Metals, post-disaster, with a permit to discharge toxic waste directly into Quesnel Lake. That is crazy.)  Recently the government began considering an exploratory permit request for Imperial Metals  to do it again in the Skagit River watershed ( "The definition of insanity is doing the same thing over and over and expecting different results.")  Turning BC's old-growth forests into toilet paper (quite insane to destroy the last tiny bit of temperate rain forest on the planet, greedy and short-sighted. For many reasons, the value of the forest lies in itself, intact.) Decimating wild salmon stocks in favor of fish farms. (Never was a good idea but an experiment that may end up resulting in the extinction of the Pacific Salmon runs and the resident Orca Whales, good job government.) Turning a blind eye to criminal activity in the gaming industry. (The level of greed displayed here by the previous Liberal government and the repercussions of that greed to each and every citizen of this province is beyond forgiveness, Aiding and abetting criminal enterprise is a criminal act and should an Independent Public inquiry finally be demanded by those most harmed by this betrayal of public trust, us, those found responsible should be prosecuted to the full extent of the law.) All the above is just scratching the surface, Shall I continue? 

    The NDP and the Liberals seem to be skipping hand in hand down fossil fuel lane, what is this? Arch enemies finding common ground while exercising zero common sense,  this sounds a little crazy! insanity or greed or both?  John Horgan, George Heyman, the supporting members of the NDP party, the complete federal and provincial liberal parties...if the shoe fits, wear it. Anyone that would endorse a short term plan for profit at the expense of a livable future is not playing with a full deck of cards and gambling with our future while using our money to do it is unconscionable.   

    To those party faithful who continue to provide their support for a  party that would sacrifice their welfare to an unsustainable future and a federal government that would sacrifice the entire planet earth "To the benefit of Canada" ... it may be time to take a hard look at the future path you are helping to build for your children's future stake in a dying planet. 

     

     

     

       

     

    Edited by Douglas Jackson

    Share this comment


    Link to comment
    Share on other sites
    On 2019-05-05 at 11:00 AM, Tim McGiffin said:

    A very good article but what's up with the vegan signoff? That really takes away from the author's work IMHO. It gives him the appearance of acting holier than thou. Good luck being vegan if you are Inuit. Just saying! 

    Why, because it indicates that he puts his concern for animals and the environment into actual, meaningful action? Are you an Inuit? If not, what's your excuse? No doubt you don't have one. 

    Share this comment


    Link to comment
    Share on other sites


    Join the conversation

    You can post now and register later. If you have an account, sign in now to post with your account.

    Guest
    Add a comment...

    ×   Pasted as rich text.   Paste as plain text instead

      Only 75 emoji are allowed.

    ×   Your link has been automatically embedded.   Display as a link instead

    ×   Your previous content has been restored.   Clear editor

    ×   You cannot paste images directly. Upload or insert images from URL.




×
×
  • Create New...