B.C. Election Analysis: Questions raised about Conservative plan to triple LNG production

A rendering of the Ksi Lisims LNG project in northern B.C. Illustration courtesy of Ksi Lisims LNG.

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The B.C. Conservatives are betting big on LNG to help drive economic growth in B.C. over the coming years, promising to double production by 2032 and triple it by 2035. But the NDP says the province is already on track to meet that goal, while some experts say the future of the sector is uncertain due to slowing demand.

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On one of the first days of the campaign, Conservative leader Lorne Doerkson made his LNG promise one of the party’s signature planks, along with an income-tax cut, of a plan to “supercharge” the B.C. economy.

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His party’s platform projects that this plan will increase GDP growth from the current projection of 1.9 per cent to 2.5 per cent in 2027, and from 2.1 per cent in both 2028 and 2029 to 2.8 per cent in 2028 and 3.2 per cent in 2029.

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“If a project is good for British Columbia, it is going to get a yes,” said Doerkson.

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However, the promise has been greeted with derision by the NDP, with leader David Eby saying once again on Wednesday that projects approved by his government, including LNG Canada Phase 2, Cedar LNG and Woodfibre LNG, are already set to triple production.

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He said that his party’s platform projects LNG production will increase to 48 million tonnes by 2035 if all five projects currently underway or awaiting a final investment decision, including Ksi Lisims, get completed, a more than doubling of current production of 14 million tonnes per year.

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“Mr. Doerkson’s projections about supercharging the economy with LNG actually has lower projections for LNG production than what’s currently in development in British Columbia,” said Eby.

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Clark Williams-Derry, an energy finance analyst at the Institute for Energy Economics and Financial Analysis — whose mission is to accelerate the transition away from fossil fuels — said neither the NDP nor the Conservatives are facing the reality that LNG imports are declining in countries such as China, Japan and Korea, as well as within the European Union.

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He said others, such as Thailand, are trying to move away from the fossil fuel given the volatility of supply, particularly amid the ongoing conflict in the Middle East that has effectively shut down production in places like Qatar.

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“LNG markets have gone through two major shocks since 2022. We’ve seen slower demand growth globally, and evidence that Asian economies are no longer as wedded to LNG as part of their future energy development strategies,” said Williams-Derry.

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He added that there is so much supply coming online in places like the U.S., Mexico and Nigeria that, prior to the start of the U.S. bombing of Iran, prices were already falling.

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Werner Antweiler, a UBC economist, said neither the NDP nor Conservatives are promising anything new outside of what is already happening on LNG, but are using their promises to expand the sector to inflate economic growth figures.

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He said both parties’ platforms are fiscally irresponsible and reliant on “sheer optimism” and that the Conservatives’ growth targets are not realistic.

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“These gross projections are not in line with what experts actually predict from various macroeconomic models, and the banks in particular, and the commercial companies that work on forecasting,” said Antweiler.