With the provincial government on the cusp of announcing its tax and environmental regime for liquefied natural gas, the head of an industry group issued a warning Wednesday: the window is closing and B.C.'s trillion-dollar LNG dream is not a foregone conclusion.
David Keane, president of the newly-formed B.C. LNG Alliance, said the provincial and federal governments will have to make some "difficult choices" if they want the tens of billions of dollars of investment.
"The members of the B.C. LNG Alliance currently find themselves at a crossroads," Keane told audience members at a Vancouver Board of Trade energy forum.
"The (alliance) is concerned about our global competitiveness and the overall fiscal framework in British Columbia and in Canada."
There are huge technical and financial challenges to such complex projects, and there is significant risk, said Keane, whose organization represents six of the 18 projects currently proposed in B.C: Kitimat LNG, LNG Canada, Pacific Northwest LNG, Prince Rupert LNG, Woodfibre LNG and Triton LNG.
"We need certainty, clarity and a competitive fiscal framework that includes fair federal and provincial taxation," he said.
Legislation around LNG must strike a balance between fair value for British Columbians for their natural resources and a "reasonable rate of return on what will be historic levels of investment."
Keane declined to clarify specifically what kind of "clarity" LNG investors need, or to offer any target tax figures.
B.C. Premier Christy Clark and her Liberals were re-elected last year on promises of a trillion-dollar LNG industry that would provide tens of thousands of jobs and pay off the provincial debt.
The Liberal government plans to introduce two separate pieces of LNG-related legislation in the coming weeks. The tax regime is expected to be tabled next week and an emissions reporting bill is due in late October.
Emissions remain a thorny issue in B.C., where the province has legislated targets for the reduction of greenhouse gases and where most LNG proponents want to burn natural gas to generate the massive amounts of power needed to liquefy the gas for export.
Earlier this week, Malaysian gas giant Petronas said it may delay a multibillion-dollar LNG export facility near Prince Rupert, B.C., if it can't reach agreements with Victoria and Ottawa by month's end.
Clark has suggested the threat is a negotiating tactic as her government prepares to announce the tax regime.
But Keane said B.C. is in a highly competitive market, up against the U.S., Australia and Russia. Alliance members must consider the costs over the life of a project, he said.
Current global demand is around 250 million tonnes. By 2020, it's expected to be about 400 million tonnes and there are now 70 million tonnes in capacity under construction, he said.
"The window of opportunity to sell B.C. LNG into the global market is closing," Keane said after his speech.