Last week, another blow was delivered to BC’s LNG industry when the partners behind the $28 billion Aurora LNG project pulled the plug after four years of analysis.
The setback is forcing many people to wonder, what is the future of liquefied natural gas in this province?
NEWS 1130 put that question to an economist after the companies walked away from the project near Prince Rupert.
Werner Antweiler with UBC’s Sauder School of Business wasn’t surprised when he heard the news that Nexen and its partners were dumping the project.
He’s also not expecting projects on that scale to go ahead in the short-term given the low price of natural gas. “Clearly, LNG is facing an uphill struggle in British Columbia simply because the market has shifted. The price for LNG is down and that means many other projects in BC are at the margin of profitability.”
Antweiler doesn’t expect that to change anytime soon. “The economics is really driving this decision and I can’t fault the company in making this decision simply because the market has walked away from LNG.”
However, Antweiler believes demand for LNG will go up in the long-term as Asia transitions away from coal, that means we could see other proposals if prices make projects feasibl