A new report by the Conference Board of Canada suggests a growing West Coast LNG industry could spur the creation of 100,000 jobs a year just when Canada's economy needs it most.
Energy Examined host Leighton Klassen speaks with Bryan Cox, CEO of the Canadian LNG Alliance about this opportunity—how sending liquefied natural gas to markets in Asia could create not only economic growth in B.C., but manufacturing jobs in Ontario, service sector jobs in Alberta and much more, while helping to reduce global GHG emissions with some of the cleanest LNG produced in the world.
Leighton [00:00:08] Hello and welcome to another edition of the Energy Examined podcast: the podcast that discusses the issues facing Canada's oil and natural gas sector with insiders in the know. I'm Leighton Klassen, and today, I'm joined by Bryan Cox. He's the CEO of the Canadian LNG Alliance. In today's podcast, we're going to talk to Bryan about a new report on LNG that was issued this week by the Conference Board of Canada about the potential for LNG in B.C. and the rest of Canada. So thanks for joining us on Energy Examined, Bryan.
Bryan [00:00:38] Great to be with you today, Leighton.
Leighton [00:00:40] Let's first start off with your organization, the Canadian LNG Alliance. Can you just tell me briefly about what the organization does?
Bryan [00:00:49] Absolutely, yeah. Like I said, great to be with you today. And to talk a little bit about the LNG industry. We're really excited at the Canadian LNG Alliance. A lot of the reason is because we're newly the Canadian LNG Alliance. We evolved from the B.C. LNG Alliance back in June. And now that's really exciting for ourselves and our members to engage really in a pan-Canadian manner about what the LNG opportunity is for Canada, predominately through our projects in British Columbia and what they can do for our growing economy here in Canada, and also what our contribution can be to the global energy transition. And so this is a recent change for us to become the Canadian LNG Alliance. And we're really, really excited to continue our engagement and advocacy with the entire country about what this this industry can mean for us.
Leighton [00:01:43] Great. And for those who may not know what LNG is, it's obviously liquefied natural gas. But can you briefly explain a little bit about what LNG is and what is used for?
Bryan [00:01:56] Absolutely. So LNG is is something that's being being used around the world right now and is being turned to more readily by countries around the world for their energy needs. And really all it is, is our natural gas. It's natural gas cooled down to around minus one hundred and sixty degrees centigrade. And when it when it gets to that temperature, it turns into a liquid and it really constricts in size to about one six hundredth of the size of natural gas. And so you're able to transport it much more efficiently in liquid form. And so essentially, all that the LNG industry is is taking the natural gas that we produce every day in Canada and enjoy as a fuel every day here in Canada in our homes, you know, at our barbecues and our stoves and our furnaces and all across the country and takes that out to other markets. And in doing so, we're building LNG facilities, which will cool that gas down, turn it into a liquid, be able to transport it to other countries -- predominantly are opportunities are in Asia off the West Coast. And then all it is, is returned back to the air temperature and it turns back into a gas. And it's just the natural gas that we enjoy every day except that other countries can take advantage of it.
Leighton [00:03:16] Now, that's a good segue into a really important report that came out this week. The Conference Board of Canada issued the report titled A Rising Tide: Economic Impacts of LNG in Canada. So first, Bryan, what was your organization's involvement in this report?
Bryan [00:03:34] So the report that come out came up from the Conference Board of Canada is a very exciting report. We commissioned the report for the Conference Board to do this work. And I think many of your listeners will know the Conference Board and the work that they've been engaged in in the country for decades, very, very reputable economic organization who produces reports of multiple sectors and parts of the economy. So a very, very great group to do this particular report. And really, we provided they base this report off a scenario, Leighton. So it's just a scenario of what growth could look like for the industry. And this is, again, focused on the opportunities in British Columbia. There are obviously opportunities across the country including in Quebec and on the East Coast. We wanted to really show what the opportunity could be for growing the sector here in British Columbia. So that includes, of course, the LNG Canada Project, which is in construction as we speak, a 40 billion dollar investment, the largest private sector investment in our country's history. It's being built, of course, as we speak and what a growth scenario could look on top of that as well. And it's a very, very powerful report, I think, for the entire country to take a look at.
Leighton [00:04:52] Yeah, there's lots of numbers in there. And we're going to dive into those specifics in the next little while here. But I wanted to get, in your view, from a very high level: What if you can, is the most important element or finding in this report?
Leighton [00:05:08] Well, I think what this report does differently than the many reports regarding economic development, but especially in the natural resource base, is it talks about what growth would look like for the entire economy by province, and really importantly, by sector. So we often talk about, you know, with big infrastructure projects, what the jobs and GDP growth will be for that project itself. And they're always very, very striking and important numbers. What we often don't talk enough about is what a growing economy--what infrastructure projects such as these do to a growing economy and how that rises, you know, raises the level of all boats in the economy. So this this particular report talks about what, you know, will happen with manufacturing jobs in Ontario or retail jobs, finance, real estate. It talks about the economy and shows how interconnected we are as a country and why it's so important that we develop industries like the LNG industry because it benefits us all.
Leighton [00:06:16] Now, the report states that all the highlights are based on an investment scenario. I know you alluded to that before. And this investment scenario creates a 56 million tonne per annual LNG industrial footprint in the province of British Columbia. What can you tell me about this investment and specifically who needs to invest in the province's LNG initiatives in order for them to be successful?
Bryan [00:06:41] Yes. So the scenario that's talked about is a growth scenario for B.C. And I think the important thing to talk about is what that could get us. And that's, you know, over ninety five thousand jobs in Canada every single year, over 11 billion dollars in GDP growth. And six billion dollars in growth in wages. And I think that's why this report is so timely for having a dialog with Canadians is because of the situation we find ourselves in with COVID and where we're at with the economy. We need stable, well-paying jobs that can last for years and years and years. And this particular industry, this opportunity, can provide that. And in fact, is through the project that I discussed, the LNG Canada project. We can have more of that. And I think that's what the report really highlights, is that now is the time to really take advantage of this opportunity for the benefit of us all.
Leighton [00:07:40] And I know our listeners, you know, probably through watching the news through the last couple of years or even more recently, they probably seen a little bit of what's going on in B.C. in terms of LNG projects. But what are some of the key LNG projects in your view that are either under construction and or, you know, are planned that will contribute to the scenario some of the more important ones?
Bryan [00:08:03] Yeah. So the opportunity for Canada when it comes to LNG is really, really special in a lot of ways. But really importantly because we have the opportunity to develop the lowest emission LNG industry in the world. The LNG Canada Project, which is in construction, when it comes into operation, we'll be the lowest emitting LNG facility in the world. And the other projects that are proposed for British Columbia will be even lower emitting. And that's because of taking advantage of our innovation and our clean hydroelectricity that we have in British Columbia. So so when you look at that, we've got the LNG Canada project in construction. There's the Kitimat LNG project, which is hoping to get to an F.I.D., which is proposed to be an all-electric facility. So that would be the largest all-electric LNG facility in the world. We've got the Woodfibre LNG project just outside of Squamish, which is looking to get to a final investment decision soon. We've got Fortis B.C. and then something we forget about in British Columbia and in Canada, really, is that we've had an LNG facility in B.C. since 1971. The Tilbury LNG facility, which is Fortis's facility in Delta in the Lower Mainland. They're looking to expand that facility right now. It's in the environmental assessment process. And the interesting thing about that particular project is it's looking predominantly to provide transition in the marine environment. So to transition the marine sector off bunker fuel on to LNG, which is a massive opportunity in the marine shipping industry. And it could be a great economic opportunity for the Port of Vancouver and for Canada as a whole. And there's several other projects that are, you know, in development as we speak as well. So we have incredible opportunity in Canada and with the projects in British Columbia to really take advantage of this opportunity to provide LNG to the world and do it in the lowest emission form.
Leighton [00:10:13] Well, it sounds like there's definitely a lot going on, which is a positive for a country. In regards to B.C.'s, GDP, gross domestic product: what is the scenario? And, you know, even looking at the projects that are currently in construction, but looking at this report scenario, what does it mean for the province and for the rest of Canada in regard to GDP?
Bryan [00:10:33] Yeah, I think it's really important to look at this report and what the benefits are to Canada. Obviously, many of the benefits will be here in British Columbia. So you look at that total of eleven billion dollars in GDP growth per year, about eight billion dollars of that would be realized in British Columbia. And importantly, Alberta and Ontario are two provinces that benefit greatly from developing the industry here in B.C. So it's again, engaging in a different dialog with Canadians about infrastructure and the energy industry more generally. Because, you know, we often think the energy industry is something that happens in Western Canada. But it's something that happens--yes, the development is here--but it's something that positively benefits the entire economy, especially if you look at the Ontario numbers. It's it's really quite striking to see, you know, 10,000 jobs per year in Ontario every year. And you factor in that the opportunities for government revenue for each of the--jfor not only the federal government and the B.C. government--but other provincial governments. So as governments are looking to find revenue sources post COVID, this is an industry that can really provide benefit across the country. These are very important results in this report. I encourage all of your listeners to go take a read of it. It's not a long report. Really appendix C in the report is really striking because it breaks out all of the job opportunities in different sectors across the entire country. And that's something that I think is new for reports like this. It's something that I think everyone, no matter what sector you work in, can see themselves in because you can say, oh, I'm in the real estate industry. And well, lo and behold, there's jobs for our sector. There is a growing sector. And it's not something we often make a tie on when we when we think about particular industries is how that benefit expands across the entire economy and really importantly, into our urban centers.
Leighton [00:12:42] Yeah, that's a good segue . I did want to talk a little bit more about that. You know, with the report, you know, one hundred thousand jobs, six billion dollars in wages and the type of jobs that, you know, you've kind of brought up, you know, real estate is the example. What are some other types of jobs? I think a lot of people, you know, would would be interested to know, you know, how this affects them and their specific field of expertise.
Bryan [00:13:08] Yeah, absolutely. I think and again, if you go to Appendix C in the report, it lays it all out, but here's, you know, just talking a couple of examples. You look at British Columbia: accommodation and food services, three thousand jobs every single year in that sector. So you think about some of our most hard hit sectors in the economy right now, well, obviously, restaurants, accommodation, tourism are feeling it, you know, as more than many other sectors. So here's an opportunity through developing the LNG industry to get those sectors back up and humming again. You look at Alberta retail and wholesale trade. Fifteen hundred jobs per year from developing an industry in the neighboring province. So, you know, in Ontario, manufacturing eleven hundred jobs. So you think of all of the manufacturing requirements or the pipe infrastructure and all of the related infrastructure around building this opportunity out. And then the maintenance that will be required and upgrades over the next four decades as this industry progresses. It's huge manufacturing opportunities in Ontario. So it's a really powerful look at truly what the Canadian economy is and how interconnected we are as a country and how these decisions need to be taken with that lens in mind, that these opportunities, like these LNG projects, are ones that benefit each and every Canadian from coast to coast to coast.
Leighton [00:14:42] Now, I know a lot of industry associations, you know, right now as we are starting to reopen our economy and recover from the pandemic, even though it's still going on, trying to figure out ways on how we can have a successful recovery. So what can and I know you've alluded to this, but what specifically could the LNG industry in Canada play in Canada's economic recovery?
Bryan [00:15:12] Yeah, Leighton, I think the LNG industry can play an absolutely central role in our economic recovery. And importantly, in our energy dialogue in this country. I think it's time for us as a country to talk about what we truly can be when it comes to energy in the world. We have so many commodities. When you think of our metals and minerals, you think of our oil and gas, you think of our hydroelectricity, our renewables, our opportunities for leadership. And in so many different ways, the LNG sector is really at the centre of that dialogue. So we have an opportunity to really help the country out from an economic point of view, and help with an energy dialogue point of view about really what we do as Canadians and how we should be so very, very proud of our natural resource industries. And, you know, I think it's really time for us to come together as a nation, especially with the economic times that we find ourselves in and then realize this opportunity to provide prosperity for all of us, importantly, and to provide those cleaner energy solutions globally. This is truly an opportunity for Canada to shine.
Leighton [00:16:26] Now, I wanted to talk a little bit more about that on the environment front. As you mentioned, LNG is is considered a clean source of energy. In fact, it creates about half of the greenhouse gas emissions that coal does. What can you say about the potential to be seeing being a leader in clean energy in Canada and how it can contribute globally?
Bryan [00:16:45] Yeah, absolutely, all of those things are true. And I touched on that, I think, a little bit earlier around how our facilities will be the lowest emitting facilities. And I think that's a huge advantage for us in Canada. I was in Japan last year talking to many of the buyers in Asia, and every one of them said, you know, we we would like to buy your LNG because it's the cleanest. We're not going to pay you any more for it, but we want to buy it first. So there's a real commercial opportunity for us in Canada to provide our LNG to places in the world that are looking for it. And of course, we need to make sure that we're cost competitive so that we can we can build the industry out as we should be able to. So I think there's incredible opportunity from a climate point of view for us to make that contribution. And importantly, investing in the infrastructure for the LNG opportunity helps empower the continued transition that we're making to cleaner energy solutions. When you think of opportunities like hydrogen, well, that infrastructure that's being built and that we currently have our distribution network and natural gas and what we can do with this LNG buildout will help with that continued transition. So you think about where the LNG industry sits and where our natural gas opportunity is particularly, it's a very powerful time for Canada to deliver prosperity now through these projects and continue to play that leadership role as we continue to to make a transition. So it's something that I think hasn't been talked about enough and something we're very, very committed to talking about with Canadians, because it's time for us to realize this opportunity.
Leighton [00:18:33] Now, I'm wondering if there is any--if you can speak to any challenges associated with, you know, according to this report, you know, there's a potential to produce 56 million tonnes annually. So how will this affect B.C.'s emission targets outlined in the B.C. Climate Change Accountability Act?
Bryan [00:18:56] So that's a conversation that we're engaged in with the province of B.C. [and] federally about what we we can do as an industry to reduce global emissions. And how can we find ways to continue to work emission reductions for our industries here. Think of opportunities like carbon capture utilization and storage. You know, we're very supportive of investments in technologies and innovations around opportunities there. When you think about what from an offset perspective of market mechanisms and other initiatives that could be put into place to help, you know, with offsets and also really empower Indigenous communities through opportunities like that. So there's huge opportunity for the LNG industry to play a leadership role in that regard. And again, because we are able to produce the lowest emission LNG, it's incumbent on us, I think, to find a way to build this industry out so we can make that global contribution to reducing greenhouse gas and particulate matter. And I think there's a real opportunity for the innovation that's being worked on every day in the industry, like I mentioned on opportunities like carbon capture, utilization and storage and the transition to hydrogen and how that could look. It's very interesting and I think important for us to continue to work towards.
Leighton [00:20:27] OK, great. Now, we've talked about a lot of different elements of the report. Very interesting. Some really poignant numbers in terms of B.C.'s potential and Canada's potential for LNG. If you could, what what would be the one--you know, depending on you know, a listener is in B.C. or Manitoba or out east--what would be the one takeaway that you would want somebody who reads this to leave with?
Bryan [00:20:56] Well, I think the takeaway is that we are a country and we are connected, and together we can have economic recovery that works for everyone, and we can do it through an industry like the LNG industry. And I think that's what this report really clearly shows is what the benefit is from growing, you know, a private sector investment through the economy and how that can look. And you look at what this industry is doing, what the LNG Canada Project is doing, the partnerships with Indigenous communities, the partnerships with communities, the supply chain that's being mobilized across the country. That's happening now as we speak with a 40 billion dollar investment. And this particular report shows that what can happen when we have more of that. And I think when you look at where we're at economically as a country. This is real. These projects are shovel ready, and it's time to move forward on them. And we can realize all of the benefits that are outlined in this report. And it's not something that's just going to benefit Western Canada or certain portions of B.C. This is an opportunity that's going to benefit our entire nation.
Leighton [00:22:14] OK. Well, the the report, so now obviously it came out this week. Where does it go from here? I know it's on the Conference Board of Canada's website that any member of the public can download it. Where do you see it going from here?
Bryan [00:22:31] Well, I think I think we look at this as the start of a conversation. And I think that the power of the data that's in the report the Conference Board put out is, is that, like I said, hopefully everyone can see themselves in it and we can engage in dialogue and tease out the stories of what's happening within the industry and how we are connected, because developing an industry like LNG, if we do it and continue to do it in the right way, it will empower even more growth across different sectors because it'll tie us closer together as Canadians. I think this is truly a new world we're in in the COVID period that we're in. And we have an opportunity to really come together as a country and benefit each other through the, you know, through all of the endowments that we have. And really importantly, a big piece of that are our natural resources. We are endowed with multiple commodities, natural resources, and we're world leaders in developing those. And I think the LNG opportunity is a real shovel-ready opportunity that we can rally around as a country and move forward on. And so I think that's what we hope to engage in, is that continued dialogue with communities, with governments, policymakers to move this conversation forward.
Leighton [00:24:00] OK, great. Well, thanks again very much, Bryan, for being on the show and providing your insights and information on LNG, really exciting. So thanks for being on the show.
Bryan [00:24:13] Really appreciate it Leighton. Thanks so much.
Leighton [00:24:17] That was our conversation with Bryan Cox, CEO of the Canadian LNG Alliance. Stay tuned for our next Energy Examine podcast. And if you liked this episode, share it with a friend and make sure you subscribe on whatever podcast network you use. For more stories and interviews on Canada's energy industry check out our website: context.capp.ca. See you next time.