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New agreements strengthen economic future for Lax Kw’alaams

Press Release

February 15, 2017

Office of the Premier
Ministry of Natural Gas Development
Ministry of Aboriginal Relations and Reconciliation

VICTORIA – The Province of British Columbia and the Lax Kw’alaams Band have reached multiple agreements to ensure benefits accrue for First Nations as a result of the construction and operation of a liquefied natural gas (LNG) export industry in the Prince Rupert area.

“This is a major milestone for the Lax Kw’alaams First Nation and for British Columbia’s natural gas future,” said Premier Christy Clark. “Building this new industry is an unprecedented opportunity to create jobs and economic prospects for British Columbians and these agreements ensure Lax Kw’alaams members will directly benefit from the industry’s growth.”

There are three key components: a Lax Kw’alaams LNG Benefits Agreement, a Coastal Fund Benefits Agreement and a Pipeline Benefits Agreement.

The LNG Benefits Agreement provides financial benefits including a trust fund and capital for road improvements and infrastructure. Upon Pacific NorthWest LNG’s (PNW LNG) final investment decision, a predetermined amount of funds will be released from the trust, with the remaining balance available once facility construction begins. A total of 1,942 hectares of Crown land will also be transferred to the Lax Kw’alaams Band as part of the benefits detailed in the agreement.

“After many meetings and negotiation sessions, I feel pleased we are at this stage,” said Mayor John Helin, Lax Kw’alaams Band. “We have the first of its kind environmental agreement and have a benefits package that will allow us to go a long way to address the needs of our members, should this project proceed.”

The Coastal Fund Benefits Agreement defines ongoing benefits for the Lax Kw’alaams Band during export operations, including those linked to PNW LNG and any additional LNG export facilities that may be built in the Prince Rupert area.

“Building a liquefied natural gas export industry is an economic boost for our entire province and this agreement solidifies a prosperous future for the Lax Kw’alaams Band,” said Rich Coleman, Deputy Premier and Minister of Natural Gas Development. “We are excited to partner with the Lax Kw’alaams Band to reach this significant milestone.”

“Working with the Lax Kw’alaams and our other First Nations partners is an important part of the legacy we’re working hard to build in northwestern British Columbia,” said Wan Badrul Hisham, chief project officer, Pacific NorthWest LNG. “This agreement represents the beginning of a decades-long journey of partnership and mutual respect between Pacific NorthWest LNG and the Tsimshian people.”

In addition to benefits identified under the LNG Benefits Agreement and Coastal Fund Benefits Agreement with the Province, PNW LNG has executed an impact benefits agreement with the Lax Kw’alaams First Nation which will  serve as the foundation for long-term, mutually beneficial partnerships.  The PNW LNG agreements with Lax Kw’alaams include:

  • Access to employment;
  • Training and capacity funding;
  • Financing for cultural support;
  • Participation in ongoing environmental monitoring;
  • First Nations business opportunities in the construction and operational phases of the project; and
  • Annual payments based on production of the LNG facility.

As well, the Lax Kw’alaams Band signed an agreement related to TransCanada’s Prince Rupert Gas Transmission line – the connecting pipeline for PNW LNG.

“These agreements provide important benefits for the Lax Kw’alaams Band to build on the opportunities created for them as part of the LNG industry’s development in our province,” said John Rustad, Minister of Aboriginal Relations and Reconciliation. “Collectively, these agreements strengthen the economic security of the Lax Kw’alaams Band for many decades.”

“This is a significant milestone for PRGT, Lax Kw’alaams, Pacific NorthWest LNG and the Province of British Columbia. We’re very happy to be a part of this through our agreement with Lax Kw’alaams,” said Tony Palmer, president of Prince Rupert Gas Transmission. “These agreements are the product of strong engagement practices and years of collaboration.”

Last month, British Columbia, the Lax Kw’alaams Band, the Metlakatla First Nation and the Government of Canada signed an Environmental Monitoring Committee Agreement which outlines how all parties will collaborate to facilitate environmental oversight over the lifetime of PNW LNG.

The PNW LNG project, located in the district of Port Edward,  is pending a final investment decision by PETRONAS and their venture partners: Sinopec, JAPEX, Indian Oil Corporation and PetroleumBRUNEI. Collectively, this partnership is conducting a full evaluation of the PNW LNG project before any final investment decision is announced.

Learn More:

The Lax Kw’alaams Band: http://laxkwalaams.ca/

Lax Kw’alaams First Nations Benefits Agreement: http://ow.ly/R9Yw3092Jcf

Environmental Monitoring Committee Agreement: http://ow.ly/gjnT3090KKo

Benefits agreements with other First Nations: ow.ly/FHpL0

More about LNG in British Columbia: www.LNGinBC.ca

Two backgrounders follow.

BACKGROUNDER 1

Lax Kw’alaams Band Agreements

There are three components of today’s milestone between the Lax Kw’alaams Band and the Province of British Columbia, with specific benefits linked to the construction and operation of Pacific NorthWest LNG, and its connecting pipeline, the Prince Rupert Gas Transmission Natural Gas Pipeline Benefits Agreement.

Lax Kw’alaams First Nation LNG Benefits Agreement

  • Funding totalling $98.5 million:
    • $3 million.
    • $3 million for implementation and community engagement.
    • $500,000 for communications infrastructure.
    • $22 million, for the Trust Contribution.
      • Upon PNW LNG’s final investment decision, $7 million will be released from the trust fund, with the remaining balance available once facility construction begins.
  • Spending Commitments
    • $50 million, for potential road or other transportation infrastructure updates after PNW LNG commences construction.
    • Plus the $20 million, provided earlier as part of B.C. on the Move, the B.C. government’s 10-year transportation plan, for road improvements conducted along the Tuck Inlet Road. The Tuck Inlet road project included a 17.5-kilometre paving upgrade from a connecting ferry dock, replacing an aging bridge and improving safety and accessibility for residents, businesses and tourists to and from the Lax Kw’alaams community.
  • Lands: Crown land transfers totalling approximately 1,942 hectares, including:
    • 60-hectare Wampler Way parcel, to be transferred jointly to the Lax Kw’alaams Band and Metlakatla First Nation.
    • 40-hectare Quarry parcel, transferred on the effective date of the agreement.
    • Additional lands transferred over a five-year timeframe once construction on PNW LNG begins.

Coastal Fund

  • a one-time benefit of $295,000
  • ongoing annual benefit of $590,000
  • Production benefits of $0.024 per tonne once LNG is being shipped from an LNG facility.

Prince Rupert Gas Transmission Natural Gas Pipeline Benefits Agreement

  • Payments totalling $4.18 million
  • Additional $815,000 per year, starting on the first anniversary of the pipeline in-service date.

Community Benefits

The Lax Kw’alaams Band will use funding for:

  • community development projects and social initiatives.
  • investment in renewable energy projects and community energy planning.
  • marine emergency response initiatives, including participating in new response programs.
  • developing greenhouse gas off-set projects and environmental off-set or remediation projects.
  • education and skills training, in particular for Lax Kw’alaams members to participate in business or employment opportunities created by LNG projects.
  • economic development, including investment that supports LNG development activities and transportation infrastructure.

LNG industry a game-changing prospect for B.C.

Global trade of LNG has increased exponentially in recent years and is poised to continue as energy demands escalate and the global market improves. Countries that are expected to lead global economic growth, such as China and India, are interested in securing new supplies of the world’s cleanest-burning fossil fuel. Other countries, such as Japan and South Korea, which have been the world’s largest importers of LNG, are looking for opportunities to diversify their energy supply options.

British Columbia’s vision for LNG exports began in September 2011 with the release of Canada Starts Here: The BC Jobs Plan – a plan to strengthen local economies by getting B.C.’s products to new markets.

As part of the BC Jobs Plan, the provincial government set a goal of diversifying the province’s natural-gas sector and developing a means to export to other markets. To achieve this goal, an LNG strategy was developed that set in motion a plan to build the industry. The strategy captured the attention of large companies and global investors, which have since come forward with numerous LNG proposals, now at various stages of development.

There are approximately 20 LNG proposals looking to export British Columbia’s clean natural gas to markets in Asia at this time.

Collectively, the LNG industry holds the potential for tens of thousands of jobs and new economic opportunities for British Columbia.

A full list of projects can be found online: http://lnginbc.gov.bc.ca/tile/bc-lng-projects/

Pacific NorthWest LNG

Pacific NorthWest LNG is comprised of PETRONAS, Sinopec, JAPEX, Indian Oil Corporation and PetroleumBRUNEI.

The facility is proposed within the District of Port Edward, near Prince Rupert.

Pending a confirmed final investment decision, the facility would result in up to $36 billion in new capital spending, 4,500 new construction jobs and close to 350 permanent positions.

The facility received an Environmental Certificate from the Government of British Columbia in 2014. Canada granted approval in September 2016.

Prince Rupert Gas Transmission Natural Gas Pipeline

The Prince Rupert Gas Transmission project is a 900-kilometre natural-gas pipeline project that would deliver natural gas from a point near the District of Hudson’s Hope to the Pacific NorthWest LNG facility. Prince Rupert Gas Transmission is a subsidiary of TransCanada PipeLines Limited.

The pipeline will create 3,370 construction jobs and require 23 permanent positions once operations begin.

All major pipeline permits have been approved by the BC Oil and Gas Commission. British Columbia issued the pipeline an Environmental Assessment Certificate in November 2014.

To date, 17 of the 19 First Nations along the Prince Rupert Gas Transmission pipeline route have pipeline benefits agreements in place with the Province. The agreements with 14 First Nations along the pipeline route are public and the other agreements will be made public as they take effect. The public agreements are with the following First Nations:

  • Doig River First Nation
  • Gitxaala First Nation
  • Gitxsan First Nation
  • Gitanyow First Nation
  • Halfway River First Nation
  • Kitselas First Nation
  • Lake Babine First Nation
  • Lax Kw’alaams Band
  • Metlakatla First Nation
  • McLeod Lake Indian Band
  • Nisga’a First Nations
  • Takla Lake First Nation
  • Tl’azt’en First Nation
  • Yekooche First Nation

Natural-gas pipeline benefits agreements with First Nations are part of the B.C. government’s comprehensive plan to partner with First Nations on LNG opportunities, which includes increasing First Nations’ access to skills-training and environmental-stewardship projects.

B.C.’s pipeline benefits agreements with First Nations: http://ow.ly/nUAi308ll2K

Media Contact:

Stephen Smart
Press Secretary
Office of the Premier
778 389-6202

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