‘Our Contribution Won’t be Small’: Woodfibre LNG vice-president

By Gagandeep Ghuman
Published: Feb 8, 2014

An LNG export facility being planned on former Woodfibre pulp mill sit has thrilled some and worried others in Squamish. While many welcome the jobs and taxes the facility will create, there is anxiety about how it will impact local environment.

In an interview, the vice-president of corporate affairs at Woodfibre Natural Gas, Byng Giraud, answers questions about the project.

Q: Tell us about the company that will own the operation ?

Yes, RGE is a Singapore based multi-national company with a palm oil business, pulp and paper business. About ten years ago they started an oil and gas business, all owned by one family with a self-made man from Indonesia named Sukanto Tanoto. He had worked on LNG related infrastructure back in the 70s.

Q. Why did Sukanto chose Woodfibre ?

This is his first foreign venture and this company also represents the consumer side of things and as consumers they are also paying attention to where the gas is coming from.

“The most important thing we have to address is air emissions and it all boils down to what kind of technology we use.”

They started looking for all over North America for possible LNG sights, and the advantage of these sites is that they are already industrial, brownfield, and they have the existing infrastructure.

Q. What else makes this site viable?

A. Well, you’ve got electricity, gas, it’s zoned industrial with a deep water port, you have an educated and accessible labour force. Then, there is a permanent sewage plant, and we already have some permits there. Frankly, you avoid a lot of problems when you are going to a former industrial site.

Q. What kind of subsidy have you received from BC government?

A. There is no subsidy at all, not that I can think of. We are paying Fortis to do the extension of the gas line. When you have more consumers on the gas system, your prices may even drop because there is another big buyer on the line and every time you have more consumers, the cost of the infrastructure is divided among more consumers.

Yes, the government is providing more regulatory support for this, but I don’t think there are any financial subsidies.

Q. What about bringing the gas to Squamish?

A. Fortis has extra gas and not all the gas was being used and we asked them upgrade their line.

The gas comes from Coquitlam, then to here, and goes to the other side of the Sound, crosses to Texada. Fortis has to loop 52 kilometers, from North of Vancouver to Squamish, and they can give you more details.

Q. What kind of jobs can be expected?

A. We anticipate that during construction there will be approximately 300 jobs a year. It all depends on what kind of technology we use, but I would say somewhere over 100 jobs in 3 or 4 shifts. So, at any given time, there will be 30-40 people working there. And we would want the people working there to live in Squamish. We actually have a selfish interest that people live in Squamish, as they are more accessible when shift changes.

Q. What kinds of taxes can the district expect?

A. For municipal taxes, we are talking to the municipality and we need to figure it out. But essentially this is a 1.7 billion dollar capital project and possibly millions of dollars’ worth of construction. So how BC assessment assesses the value, we will have to see. Listen, we are a business and we don’t want to pay any more taxes that we have to, but this is a substantial piece of infrastructure.

You can do the math, our contribution won’t be small.

Q: Let’s talk about environmental impacts ?

Well, when you do any industrial activity, there is an impact. First of all, there is no discharge or emissions here and there are no solid effluents.

We have yet to figure the sound as it has to be tested on a quiet calm night on how far the noise would go. There is a shadow of the vessel that can have an impact on the marine life. For some it’s good, for some it isn’t and then of course there is the visual impact.

Q. What about the emissions?

A. Well, probably the most important thing we have to address is air emissions and it all boils down to what kind of technology we use to run the things.

You can run them on gas or electricity. If you run them on gas, they have greater emissions than if you run them on electricity.

But we will have the issue of emission and I’m not going to hide from it. We have a preliminary report that gives a certain idea but at this point we will be guessing, but yes, there will always be GHG emissions.

Q. And what is the energy source for your operation?

A. It could be gas…We may have the option to use electricity and it depends on technology and then again it depends on what BC hydro can provide us. It won’t be significant. And a  lot of information on emissions is based on what is happening up north. Their combined exports would be 31 million and we are talking 2.1 million tonnes. Even if we run on gas, we are nowhere near the output that those people are foreseeing.

Q. What is the worst case scenario for an environmental damage here?

A. If you had a major spill and I wouldn’t even call it a spill because some if it would just evaporate. We are seven kilometres from town and there is also the buffer zone around it.

If there was a spill, and I think it’s wrong to call it a spill because it’s not going to land in water or land, we have an elaborate plan.

Everything can be manually shutdown and there are stringent rules around that.

Q. Tell us something about the export part of the operation ?

A. As a small LNG facility, the Woodfibre LNG Project will result in only three to four ships per month, each ranging from 150,000 to 175,000 m3 in size. We don’t intend to own or operate the LNG carriers.

LNG has been transported by ocean carrier for over 40 years without major incidents or safety problems either in port or in transit.

And unless we expand the pipelines, our export capacity is limited. Our export licence is 2.1 million, about tenth of the size of up north.

Q. What about some of the infrastructure cost ?

A. Any infrastructure that we require, we have to bear the cost. Under the regulatory system, Fortis can’t double the size of the pipeline and make you pay for it.

If I want them to do that, they have to get BC utility commission to agree to it. And we had a financial contribution.

We have put $700,000 for some of the studies, and upgraded will cost millions of dollars. If BC hydro is putting up a substation for us, we are paying for it. You have to pay for all the infrastructure, then there are connection charges to plug-in and a higher tariff.

Industrial customers in this province are not getting a special deal.

Q. What kind of commitment do you have on sourcing local?

A. Well, we have used local design firms and we use local water taxis. For concrete and infrastructure needs, we really do operate at a very local, grassroots level. We want to interact with locals and first nations.

And as you will see, we will be doing more open houses, meeting with stakeholders group, social media etc to keep people informed about what we are doing.

Comments

  1. peter says:

    does it smell.???? We do not want to go back to the old stink days as in most of BC small towns .

  2. Sarah Weinberg says:

    What is the exact location and route of the pipeline? I have heard about a compression station in the Squamish industrial Park and then the pipeline that travels underneath the downtown core?

    The noise from this is going to be substantial? Why do we want an incessant hum in our downtown core for 30-40 jobs a year?? This is so short sighted I feel like I am dumping my investment in downtown Squamish and running for the hills!

    This is completely counter productive to the sales of the Oceanfront Development Plan. Industry sounds, air and visual pollutants will not bring in the high end level of development and community we are seeking in “The Outdoor Recreation Capital of Canada”!

  3. Jean says:

    Good point Peter, Any burn or industrial process smells …the question is how much and what would an accidental release do to a populated area, …asphyxiation or shock wave by an explosion?

    Availability of LNG in Squamish or at least CNG, would be nice if we at least could enjoy the use of it as an inexpensive fuel source as long as it lasts, to tank up locally, also having it available in any area of residency in Squamish at reasonable cost where one, for transportation use, could self compress the gas for use in ones vehicle at extremely low cost and high efficiency, in addition to its use for domestic heat. This would be a great contribution to a higher standard of living. The NGV the compressed CNG promised by Fortis some day…. direct from the gas company without additional marketers and delivery cost increasing the NGV fuel cost, while the price is still low and affordable, would be greatly appreciated.

    I almost feel rightfully entitled or privileged to enjoy a lower price then what the World soon is prepared to pay for this commodity exported as LN, for what ever it will be fetching on the world market and of course being a free enterpriser at heart, I have a hard time, with the deep down urge to have basic commodities and life’s essentials, provided with the least cost to the Canadian residences and its citizens and am almost inclined to think of a need of a dual Modus operandi, where every thing else is capitalistic free enterprise, but the essentials possible State capitalism, or as some others might label as socialism.

    We in BC had years ago a similar euphoria with the Chinese, promising 95 $ /ton for coal and a new town was build and extra rail line etc. etc , just to find out, that some years later the town of Tumbler Ridge was almost a ghost town and the dear customer said, they would not pay more then 45 $ ( half of what was agreed) and what the economic model was build on. Could history repeat itself?

    Listening today to the energy program on TV, the statement was made by the Chinese official ..LNG .. could be a good source as a ” interim…energy source”!!!!

    Now with the fast tracking, are we going to be again mislead, with the promise of 100 000 jobs for whom? The unemployed on Social assistance or EI persons, or more rather for the highly specialized people from elsewhere, here for a wile, gone with the pocked full of money. Lets have some real $ as to what Woodfibre LNG is prepared to contribute to Squamish tax coffer and as to the safety of the Gas travelling through the populated area of Squamish.

    Where are some creditable tests, showing when the actual safety valves where operated on the existing Gas line, tested and in case of a pipe bursting, where are the regulations that a second enclosure over the actual gas high pressure pipe would be required, so in case of a catastrophic escape of gas, where it could be stopped and properly vented . Is there any public access to such tests and regulations. Also who would foot the bill for additional firemen required and possible fire boats etc. and training of firefighters, with many more questions then answers.

    The main economic point however again, while the World is bidding up the cost of natural gas, could there be a two tear system, that the domestic Canadian consumer could be protected and locked in, say in today,s price per GJ, surely if the bulk of the commodity is slated for export at high profits, the bit of domestic gas could be subsidized if necessary for the benefit of us locals. Most likely the Gas will be marked up for highest profit…a hard thing to regulate in a free enterprise world, to have a two tear system, with the private gas company of course eagerly to please its share holders with a high return on there investment.

    In other words, we sell China and others, to produce for Walmart the things that we so gull ably and eagerly are buying and with it, reducing the jobs here more and more, by the local manufactures, more and more having to buy from them and with it, if not protected on our domestic resources, having to pay more and more, even so we desperately are looking for enterprise to establish here, or re-establish here, without the low energy availability, not going to be to attractive.

  4. Dave says:

    Sarah, I think you need to do some research and ask the right questions in the right place, not here. Try the Company, the District etc. There is a lot of stuff. Even just Google Woodfibre LNG. For what is going to be placed in Squamish, not Woodfibre, go to the Fortes Website. Fortes is responsible for all the transport of the Natural Gas to the processing LNG Plant in Woodfibre.

    • Sarah says:

      Dave I am a little concerned that the only information available is coming from Woodfibre LNG and Fortis BC. These are the companies that are in it for the profit and the development. I don’t think these sources will give is a true picture of what is really going to happen. Posting here in hopes that other information will surface. Yes, lazy mans research! Just looking for some other source of information than a glossy web page from industry

  5. Dave says:

    Sarah.
    Try these notes: http://www.davecolwell.com/2014lngnotesfeb4.pdf They were taken at the public info meeting on February 4th. by Tracy Saxeby and placed on the Squamish Speaks Facebook page. I hope this link works for you to saves you going there and digging for them.

  6. Dave says:

    Correction: To Sarah.
    Notes above were taken by
    Eoin Finn…. Facilitator and Judy Kirk
    (assisted by note-­‐taker Kai-­‐Lani Rutland)

  7. Brad Hodge says:

    With the LNG, or really any industrial proposal, it is a mistake to look only at the direct jobs. Industry pays substantial local taxes — revenue we need. When we complain about grants being cut, taxes being raised or services we don’t have, it is worth remembering how important commercial/industrial taxes are as a source of revenue. Without some larger players, we are doomed to keep escalating taxes on small businesses, which will flee, and homeowners. The end result will be a hollowed out subdivision of Vancouver, which I suspect is just what some of us would like.

    I am not advocating a return to 1969, but I’d like to keep the doors of opportunity open to ordinary folk who would like to be able to live and raise a family here. I have nothing against commuters, but it’d be nice if we didn’t all *have* to commute for work, no? Having some industry, even unsightly, is necessary towards that goal. Tourism alone will not cut it. This is not Venice or Paris. Besides, all of us in our daily lives use products that ultimately have their source in some pretty ugly looking/smelly industry. It is hypocritical and immoral to make daily use of these products but refuse to accept the location of any of the production in our own backyard.

    I keep hearing from some quarters ‘No no no, we’re not against industry, we just want sustainable, environmentally friendly industry’. But I have not seen one project proposal in the last 10 years reach that threshold. I hate trotting out the NIMBY charge, but that is what it feels like lately. Some might be willing to pack their bags over LNG.. I might be willing to pack mine if we keep saying no to investors who are actually interested in being here.

    • Sarah says:

      Brad, I am wondering if you live in and have invested in the downtown of Squamish where the community will be most affected?

  8. Jean says:

    Reply to Brad Hodge
    ……Industry pays substantial local taxes….. (How much has W-LNG offered so far..If a industry is not demanding additional services from Squamish, W-LNG eg. firefighting protection etc. there might be a net benefit but should be elaborated on )
    ……Having some industry, even unsightly, is necessary … (That is unacceptable these days and especially if public safety is at stake)
    ……It is hypocritical and immoral to make daily use of these products….( LNG.. where is it in daily use today here)
    …….I might be willing to pack mine if we keep saying no to investors who are…… (Investors is not the right word .. it is producers of Jobs we need, not 30 positions as per W-LNG statement envisioned )

  9. Brad Hodge says:

    Jean.. if all unsightly industry is unacceptable may I invite you to give up your computer, iphone, house, car, bike, etc. All of these things have their origins in an unsightly industry of some kind.

    As for taxes, I’m not sure what you’re tryibg to imply? That they won’t pay taxes? I assure you they will, and it will certainly be in excess of whatever sevices, if any, required of the District.

    Regarding your statement on investment.. I’m not sure what to say.. pretty clear economics 101 here.. to create jobs, someone must invest. ‘Only’ 20 or 30? Even if that’s correct, name one other business that opened here recently with anywhere near that number of jobs. And again, taxes.

  10. Brad Hodge says:

    A final comment if I may Jean.. the fact that LNG may not be in use here is irrelevant to my point. Every day we use products that have base components that are produced in unsightly, polluting industries. Many of these base and finished components are put together in developing countries, out of our sight but not theirs. They live with the smog and so on that is a byproduct of that. LNG is a relatively less polluting, cost effective source of energy many of these countries might use. For us to say no to producing it on ‘unsightly’ and specious environmental grounds while continuing to purchase our iphones (produced where we don’t have to see it) and the like, , is hypocritical, even tantamount to quasi-colonialism.

  11. Dave says:

    I agree Jean. But we must allow all parties to voice their views so that any industry follows correct safe procedures and doesn’t take short cuts to line its pockets heavier at our expense. It is a game ALL players must play hard, even if you don’t agree with some of them because you might think they are too green. This kind of game is the fabric of our society…like it or not. You play hard, let them do the same and the ball will end up in the middle where it belongs!

  12. David Lassmann says:

    I spent quite a bit of time at the open house meeting talking with various company representantives and all of my concerns received plausible responses. It looks to me like this project would be a good fit for Squamish. There is a debate over whether the use of natural gas is wise, for now, I leave this for others to argue.

    Natural gas is 95% methane; it is the other 5% one might want to investigate. Because the site is remote from Squamish I believe that there is little or no danger to the public from emissions (other the the 5% previously mentioned) or catastrophic failure of containment. Unlike pulp mill emissions, natural gas starts out odourless. Actually, a smelly component is normally added for the safety of consumers, so that any gas leaks can be detected by smell.

    The environmental plan seems very good, the proponent is keen to be seen to be environmentally friendly and responsible. There is even talk of reopening the surrounding area to hikers. There will be some disturbance during the construction of the pipleline, especially where it passes under the Squamish River and runs alongside the West Delta, which is part of the Wildlife Management Area of the Squamish Estuary. Overall, I would say that the environmental impact would be miniscule in comparison to a pulp mill operation.

    The biggest plus for Squamish residents would be the industrial tax base which is sorely missing in Squamish these days. At present Squamish is being saddled with having to provide and maintain expensive infrastructure for residential development. Residential development brings relatively little in the way of commercial tax and even less industrial tax. The Woodfibre pulp mill used to provide a tax subsidy to the District which covered 15% of the District’s entire budget. The LNG project should provide a similar amount or more.

  13. Dave says:

    Well written David. Lots of good points.
    Like I said the other side’s views are important too, to keep these companies involved on their toes. We need the industry but it has to be done in the best way possible.
    The very best scenario would be to burn the gas ourselves to add to our grid resource but we are locked in to our import/export system, so be it.. The gas will flow for a long time in the future. I have always thought that we can burn it better and cleaner than those to whom we are hoping to export…and gas as a source of energy is better than oil or coal.

  14. Jean says:

    To Tie up a big ” Freighter/Chemical platform-Ship”, build some where else with the 100,000 jobs promised by the government, is probably the most revenue in form of docking fees, that can be expected as Tax base for Squamish.( nobody has tackled that one yet)
    Direct jobs resulting from W-LNG, 30 full time Job positions, for the extra cost occurring, like Fire fighting, Fire boat etc.potential asphyxiation of Squamish in a catastrophic LNG release and the potential of gas line failure through a populated area with potential unimaginable catastrophic consequences…. Check Feb 13 `2014 Gas line explosion Kentucky… http://is.gd/gasfire only a few days ago, with an other explosion, a couple of weeks ago in Manitoba!!!
    High Winds, the direction in summer mainly with southerly inflow at high velocity, would also affect the desirability of the Nexen land for development in view of potential LNG spill, hitting direct to Squamish, with some potentially devastating consequences.
    Nexen land potential undesirable for a potential developer and already a burden to the Squamish taxpayers.
    Squamish branding as recreational… in need of natural environment… not Industrial chemical plant tourism.
    Hypocritical….. to sell a polluter the LNG, expecting him to stop using coal and by doing so, pollute for him in the North equal or more, by fracking the heck out of the country site, with unforeseeable and unimaginable consequences and doing more pollution ….as the real name for Natural Gas = ( Spin Dr,s Invention) … is Methane gas….,highly unfriendly to the stratosphere and if used sparingly yes, is less polluting in low levels but, Methane, does lead to the formation of compounds that destroy ozone. Monotonic oxygen (O) in the upper stratosphere reacts with methane (CH4) to form a… Wiki
    Instead of selling for export, lets use it for our infrastructure and switch cars and transportation to a less costly alternative with less cost to the consumers, possible not so desirable to the government and the lobbyist , the big industries, trying to make us even more dependent on there gas supply which they are gouging us daily, with there uncontrolled monopoly and big brother taking happily there cut, to support the bureaucracy .
    The Howe Sound maybe should be considered as a World Hermitage sight, as there is no other populated area in the world that has a more beautiful Inlet system so closed to the mayor population and as to creating more “dangerous goods” traffic on a very narrow and highly congested small passage, with many Ferries using it hourly. A floating Chemical LNG Plant could easily be established, in the ( Salish Sea) by building a pear into the Straights and a few more miles of new CNG pipe … this of course still not addressing the most contagious issue of safety of Gas pipelines, travelling underground through Squamish, with all the inherent potential risque. Woodfibre property having all kinds of other potentials much more desirable usage, to the writer, not explored in detail at this point, not having been studied yet and with the hectic speed the government is willing to proceed, on an issue that has so many unanswered issues and so many unanswered Question, it might be best to have a Moratorium and start putting our head together, not to stop something potentially good, if property addressed, but to be assured that not just a few people get rich and fill there pockets and the rest have to live with the mess afterwards. Incidentally already there is talk that not MR S…….,. but now a Chinese investment broker has apparently bought into, or taken over and again the Global TV show on energy, with the Chinese government making the statement that…. LNG is a good option… for interim use!!! one wonders how long a LNG boom could last.
    Lets also address the NIMBY at this point again.. save the world from polluting with with coal, by selling them LNG, but now burning our Methane gas, to do the fracking up North, is there not a bit of a hypocrisy in this process??? This all of course for the potential of a short term monitory gain and with it taking a step back from developing real sustainable technology and becoming a leader in sustainability with renewable resources. LNG…Is Squamish ready for it Now? Lets have CNG First… for domestic and transportation use, the availability in principal already existing in abundant amounts, for domestic heating and transportation, much more environmental friendly, opposed to Gasoline and/or Diesel, by making it finally available to everybody at affordable cost and for Vehicle use, obtainable from a dispenser, like cars now, from a gas pump ( CNG Pumping station to hopefully to come) to fill up locally, eventually developing a CNG Highway system, with future LNG add on, at great savings and environmentally saver, more responsible consumption.

  15. Les McDonald says:

    Fellow Howe Sound, Horseshoe Bay, Lions Bay, Britannia Beach and Squamish Residents,

    We have a decision to make. One so profound that it will effect the very core of who we are, and the legacy we want to leave for our families and our town. The Howe Sound and Squamish could make a brave choice to leave our legacy of chemical plants, mines, and destruction of habitat behind, and continue working towards being an eco tourism destination that the world will flock to. Squamish has been making some incredible, positive, and intelligent changes and we can all see the effects it’s having on our community. People want to live here and people want to visit here.

    The Howe Sound is coming back to life. The herring have returned, we have record Salmon numbers, and even Whales signtings have been reported in our waters for the first time in decades. I think we learned the hard way, that the marine ecosystem is sensitive beyond anything we had imagined and putting WoodFibre LNG in the Howe Sound would be a mistake of epic proportions. I think as residents a majority of us agree on this but that’s not enough. We have to make our voices heard and stop this from happening. It is a fact, that it’s not “IF” an accident will occur at WoodFibre LNG, it’s “When.” Do we have another 40 or 50 years to make a comeback in the Howe Sound? And at what cost to our families health would this come at? We all know that Squamish, is for the most part, down wind from Wood Fibre LNG and any blow off or emissions will come directly to our community effecting the health of our family and friends. We will all become residents of a poisoned community and that’s just a fact.

    Right off, I’ll admit, my opinion isn’t that important. I moved here two years ago from Banff National Park after having called it my home for over 22 years. Banff does not have a single mine, chemical plant, or a WoodFibre LNG but it has tourism. Enough tourism in fact to support the communities of Canmore, Banff, and Lake Louise with 5 Million visitors a year. Still, I was so profoundly affected by Squamish and the Howe Sound that I packed up my family we decided to call Squamish our home, and the home of my business.

    The once sleepy little mining town of Canmore made a choice many years ago, to focus on tourism. They had to. Mining and resource extraction proved over time that it contributed less and less to the community and Canmore, at the time, was the ugly brother to Banff that people drove by or stopped for gas. Now, Canmore is a thriving tourism destination sharing many of the tourist dollars that used to go exclusively to Banff. They have a thriving hotel, restaurant, and tourism industry where not one single penny comes from mining. It’s all from tourism and it’s no secret that Canmore is doing well.

    Why am I telling you this? I have seen first hand the transformation that a town like Squamish is capable of. But decisions have to be made. Do we want to be a tourist destination with a healthy ecosystem for people to enjoy? Do we want to make Squamish and the entire Howe Sound a destination where people want to stop and spend dollars or shall we continue to be unfairly seen as the ugly brother that people decide to drive through? Squamish is a beautiful vibrant community with natural, rugged beauty to rival any National Park and people are starting to see this. Our town is growing and diversifying in ways that will make us a sought after destination and a wonderful place to call home.

    We as residents know how incredibly gifted we are. Let’s not allow a corporation, from another country, to come in and destroy what we have been all working so hard to build here. There’s no quick easy way to create the change we want to see but here’s where we can start. SAY NO to the WoodFibre LNG project. It’s up to us.

  16. TJay says:

    Interesting… The Hutu-ay-ant Native band have nooooo problem with the Steelhead LNG Plant on their land @ Sarita Bay Vancouver Island…hmmmmmmmm
    Smart Natives.. as opposed to dumb -> _________________ .

    • Les says:

      Yes, the Squamish Nation are very smart first nations indeed. I’m glad you noticed that Tjay. And intellegent enough to take a look at the bigger picture of the health of thier ancestral lands and waters and communities. I have a great deal of respect for all of our First Nations, especially here on Howe Sound.

  17. Les says:

    Yes, I agree, Squamish First Nations are very smart indeed. They are a collection of First Nations people who care about thier peoples heatlh, and the health of Howe Sound, and they have the wisdom to know how to care for thier ancestral lands and waters.