Canada’s LNG industry could recreate a critical part in global energy safety, but risks creeping behind other countries, a specialist says.
Canada is particularly positioned to supply gas through the construction of facilities on the country’s West Coast, according to David Detomasi, a professor of international business at Queen’s University, who spoke in an interview on Tuesday.
In Canada, where it is frigid, liquefying natural gas is inexpensive. We can accomplish it for less money and take a shorter path, according to Detomasi.
There are a limited number of LNG tankers that can fit through the Panama Canal if you wish to ship gas to Asia. Building such facilities on the West Coast is significantly faster and less expensive. Canada is capable of doing that.
To take advantage of large-scale LNG exports, Canada will need to establish the necessary infrastructure first, according to Detomasi, as other nations are attempting to “steal most of the market before Canada can even get there.”
According to Detomasi, there has also been a recent shift in which energy security is now seen as a top priority globally.
If we can get our oil and gas to the coastlines and onto the market, Canada might significantly contribute to those issues (energy security). Because more nations are entering the fray, I believe the tension right now is that they are not all in agreement on the urgency, he said.
Detomasi’s remarks coincide with Mexico’s attempts to dominate the global petroleum export league.
Eight LNG projects totaling 50.2 million tonnes in capacity were proposed in Mexico last year, according to News. Some of those initiatives were slated to launch in 2023.
Detomasi clarified that the majority of Mexico’s LNG-related initiatives revolve around re-exporting American natural gas.
GOVERNMENT REACTION
According to Keean Nembhard, a press secretary for Natural Resources Canada, LNG could potentially reduce dependency on Russian gas, improve energy security, and reduce the usage of higher-emitting fossil fuels like coal while preventing energy poverty.
However, initiatives must be evaluated for their social, economic, and environmental responsibility. Proponents decide whether to invest in a project based on their capacity to adhere to federal and provincial regulatory norms and to compete on a global scale, he added.
According to the government agency, there are currently eight LNG projects on the West Coast in various phases of development, with operational targets spanning from 2025 to 2030.
Two LNG projects have been approved for Canada’s east coast, according to Nembhard.
According to Nembhard, “new LNG projects need to show best-in-class performance that aligns with Canada’s climate commitments, displaces higher emitting energy sources like coal and unabated natural gas, and includes pathways to future-proof investments to align with low-carbon fuel demand, such as hydrogen, as markets develop.”
ECONOMIC PROBLEM
According to Detomasi, Canada’s struggling LNG sector is a sign of more significant economic problems, such as declines in foreign direct investment, competitiveness, and labor productivity.
He claimed that because of a reluctant administration, these more general economic problems had a disproportionate effect on the oil and gas sector.
“There is a growing reluctance, at least among the federal government of Canada, to be seen as supporting a carbon-based economy even though it has committed to phasing out carbon as quickly as possible,” he added.
