THE RIVERBANK PAPERS: After the flash flood on September 11, 2017, Northwest Coast Energy News filed Freedom of Information/Access to Information requests with a number of provincial and federal agencies who have jurisdiction over the Kitimat river and riverbank camping. The first response to the FOI request is from the Ministry of Forest, Lands and Natural Resource Operations & Rural Development.
A preliminary assessment by the British Columbia Ministry of Forest, Lands and Natural Resource Operations & Rural Development indicates that the District of Kitimat can regulate access to camping on the Kitimat River bank because although the shoreline is on Crown Land, the camping area is within the boundaries of the District.
One of the possible policies that the District staff is considering is allowing only “day access” to the riverbank.
An email on October 11, from Liz Williamson, a senior policy analyst in the ministry’s Land Tenure Branch to Gwen Sewell, the District’s Director of Planning and Community Development, reads:
Permission does not apply to Crown Land within a municipality—as a result even in the absence of zoning/bylaws, any camping that does occur is technically in non-compliance with the permission and therefore could be subject to enforcement action under the Land Act.
Williamson notes that the province likely will have to be involved.
Ultimately that does rely on provincial resources and it looks like DOK would want a greater role in the use and ability to locally enforce the use as you have mentioned zoning and associated bylaws would likely be a course of action you could consider.
Williamson went on to write:
I’m waiting to hear back from one of my more experienced colleagues but I am not aware of any specific limitation to DOK creating bylaws to regulate public recreational use of vacant Provincial land within the municipal boundaries, so long as it doesn’t conflict with a government interest.
She added that the laws and regulations are complex and advised the District to get legal advice. Then she added the District should have “upfront discussions with appropriate provincial authority to ensure that the bylaws do not conflict with existing policy/legislation or other agency interests.”
Right after the flash flood both Sewell and District of Kitimat Chief Administrative Officer, Warren Waycheshen, exchanged emails with officials of both the Ministry of Lands and Forests and the Ministry of the Environment asking first if the province would have any objections to a proposed plan to put gates on municipal land to limit access to the riverbank. Council later put the gate plan on hold.
The emails quoted provincial land use permission policy that says
“Crown permission to use land requires the activity must abide by and comply with all applicable, regulations and bylaws.
Before any person may rely on the Permission they must ensure that the activity is taking place on unencumbered Crown land. The Crown land must not be within
A Protected Area includes Ecological Reserves, Parks and Conservancies
In his email to Cam Bentley, Resource Manager for the Skeena Lands district, Waycheshen asked if the province was interested in some form of joint administration of the riverbank and if the ministry was interested in joining the working group.
Sewell sent a similar email to Williamson noting,
Camping has been occupying the banks of the Kitimat River—opposite a municipal campground called Radley Park—for decades….This had been a somewhat divisive local issue (it’s no cost and traditional use, grey water, residual garbage, human waste, blocking river access for day users etc. and there is a new willingness to consider regulation or prohibition of camping following a flash flood that required a dangerous multi-force rescue effort to save 14 campers and resulted in significant property loss (RVs, vehicles and camping equipment). As camping is “unregulated” the first responders had no idea how many people were in danger or where to look for campers.
Sewell went on to say:
Given…municipal authority to regulate land use by zoning, I believe Kitimat Council may use their zoning power to limit all or selected land along the Kitimat River to “day use only.” I am far from certain this will be the course of action Council will choose to pursue. For now, we only want to identify possibilities.
Williamson replied to Sewell saying that it was good there was no loss of life in the flood. She noted the Keremeos had been going through a similar situation but that village’s problem was that, unlike the District of Kitimat, the camping was outside the municipal boundaries of the village.
KEEP THE RIVERBANK PAPERS INVESTIGATION GOING.
These days filing Freedom of Information and Access to Information requests is much more expensive than it was in the past. It is part of obstruction of freedom of information by all levels of government. One agency wants $900 for their files on the Kitimat River camping issue. That is currently under appeal. Donations (see right hand column) will help the residents of Kitimat know more about what is happening on the camping issue.
The Environmental Protection Division of BC’s Ministry of Environment is launching a major study of the water quality in the Kitimat valley, first on the Kitimat River and some of its tributaries and later on the Kitimat Arm of Douglas Channel.
There has been no regular sampling by the province in Kitimat since 1995 (while other organizations such as the District of Kitimat have been sampling).
Jessica Penno, from the regional operations branch in Smithers, held a meeting for stakeholders at Riverlodge on Monday night. Among those attending the meeting were representatives of the District of Kitimat, the Haisla Nation Council, LNG Canada, Kitimat LNG, Rio Tinto BC Operations, Douglas Channel Watch, Kitimat Valley Naturalists and the Steelhead Society.
As the project ramps up during the spring and summer, the ministry will be looking for volunteers to take water samples to assist the study. The volunteers will be trained to take the samples and monitored to insure “sample integrity.” Penno also asked the District, the Haisla and the industries in the valley to collect extra samples for the provincial study and to consider sharing historical data for the study.
With the growing possibility of new industrial development in the Kitimat valley, monitoring water quality is a “high priority” for the province, Penno told the meeting. However, so far, there is no money targeted specifically for the project, she said.
The purpose of the study is to make sure water in the Kitimat valley meet the provinces water quality objectives, which have the aim of watching for degradation of water quality, upgrade existing water quality or protect for designated uses such as drinking water, wildlife use, recreational use and industrial water supplies as well as protecting the most sensitive areas. It also provides a baseline for current and future environmental assessment. (In most cases, testing water quality for drinking water is the responsibility of the municipalities, Penno said. The province may warn a municipality if it detects potential problems, for example if a landslide increases metal content in a stream).
Under the BC Environment system, “water quality guidelines” are generic, while “water quality objectives” are site specific.
One of the aims is to compile all the studies done of the Kitimat River estuary by the various environmental impact studies done by industrial proponents.
The ministry would then create a monitoring program that could be effectively shared with all stakeholders.
At one point one member of the audience said he was “somewhat mystified” at the role of Fisheries and Oceans in any monitoring, noting that “when you phone them, nobody answers.”
“You mean, you too?” one of the BC officials quipped as the room laughed.
Water quality objectives
The last time water quality objectives were identified for the Kitimat River and arm were in the late 1980s, Penno told the meeting. The objectives were developed by the British Columbia government because of potential conflict between fisheries and industry at that time. The objectives were developed for the last ten kilometres of the Kitimat River and the immediate area around the estuary and the Kitimat Arm. “The Kitimat is one of the most heavily sport fished rivers in Canada,” she said.
However, the work at that time was only provisional and there was not enough water quality monitoring to create objectives that could be approved by the assistant deputy minister.
There has been no monitoring of the Kitimat River by BC Environment since 1995. “We’ve had a lot of changes in the Kitimat region, with the closure of Methanex and Eurocan, the modernization of Rio Tinto and potential LNG facilities.”
The main designated uses for the Kitimat River at that time were aquatic life, wildlife with secondary use for fishing and recreation.
She said she wants the stakeholders to identify areas that should be monitored at first on the river and the tributaries. Later in the summer, Environment BC will ask for suggestions for the estuaries of the Upper Kitimat Arm.
Participants expressed concern that the water supply to Kitamaat Village and the Kitimat LNG site at Bish Cove as well as Hirsch Creek and other tributaries should be included in the study. Penno replied that the purpose of the meeting was to identify “intimate local knowledge” to help the study proceed.
After a decade so of cuts, the government has “only so much capacity,” Penno said, which is why the study needs the help of both Kitimat residents and industry to both design the study and to do some of the sampling.
The original sampling station in the 1980s was at the Haisla Boulevard Bridge in Kitimat. A new sampling station has been added at the “orange” Kitimat River bridge on Highway 37. There is also regular sampling and monitoring at Hirsch Creek. The aim is to add new sampling points at both upstream and downstream from discharge points on the river.
The people at the meeting emphasized the program should take into consideration the Kitimat River and all its tributaries—if budget permits.
Last year, the team collected five samples in thirty days in during four weeks in May and the first week in June, “catching the rising river quite perfectly” at previously established locations, at the Haisla Bridge and upstream and downstream from the old Eurocan site as well as the new “orange bridge” on the Kitimat River.
The plan calls for five samples in thirty days during the spring freshette and the fall rain and monthly sampling in between.
The stakeholders in the meeting told the enviroment staff that the Kitimat Valley has two spring freshettes, the first in March during the valley melt and later in May during the high mountain melt.
The plan calls for continued discussions with the industry stakeholders, Kitimat residents and the Haisla Nation.
The staff also wants the industrial stakeholders to provide data to the province, some of it going back to the founding of Kitimat if a way can be found to make sure all the data is compatible. One of the industry representatives pointed out, however, that sometimes data is the hands of contractors and the hiring company may not have full control over that data.
There will be another public meeting in the summer, once plans for sampling in the Kitimat Arm are ready.
The Shell-led LNG Canada project in Kitimat has received a facility permit from the B.C. Oil and Gas Commission (OGC), the company said Tuesday.
A news release from LNG Canada says the permit is one of the key permits required for the construction and operation of the proposed LNG Canada project.
LNG Canada is the first LNG project in British Columbia to receive this permit, which focuses on public and environmental safety, and specifies the requirements the project must comply with when designing, constructing and operating the proposed LNG export facility in Kitimat.
The news release warns “that while today’s announcement is an important step forward for LNG Canada, the project must ensure it is economically viable and meets several other significant milestones including finalizing engineering and cost estimates, supply of labour, and achieving other critical regulatory approvals before making a final investment decision.”
That means that Shell and its partners are still keeping a close eye on factors such as the continuing collapse of the price of oil on world markets, the volatile natural gas market in Asia and the slowdown in the economy in China.
The news release goes on to say:
“We have made excellent progress in the past two years, achieving a number of critical milestones,” said Andy Calitz, CEO of LNG Canada. “Receiving our LNG Facility Permit could not have been achieved without the important input we received from the Haisla Nation and the local community of Kitimat. We continue to progress our project and appreciate the ongoing support from First Nations, the local community and other stakeholders.”
“The OGC identified several conditions that must be met by LNG Canada to design, construct and operate the project,” says Calitz. “We have reviewed these conditions and are confident that we will meet these conditions as they are aligned with LNG Canada’s core safety values and commitment to protect the environment, the community and our workers.”
LNG Canada continues to develop a number of important plans to address public safety and minimize the effects on the environment and local community. For example, LNG Canada is working closely with local emergency response organizations, as well as leading safety experts, in the development of an emergency response framework for the proposed project.
“Safety is our first priority. Safety as it relates to people and the environment is embedded into the design and planning of our proposed facility, and will carry into the construction and operation phases of our project should the project go ahead,” said Andy Calitz.
Social and economic benefits from the LNG Canada project include local employment and procurement opportunities, federal, provincial and municipal government revenue and community investments. Since 2012, LNG Canada has distributed more than $1 million to community initiatives, such as emergency services, trades scholarships and community services. LNG Canada has also contributed more than $1.5 million in programs to build awareness and help provide training for trades careers in all industries, and particularly the emerging LNG industry.
LNG Canada is a joint venture company comprised of Shell Canada Energy (50%), an affiliate of Royal Dutch Shell plc, and affiliates of PetroChina (20%), Korea Gas Corporation (15%) and Mitsubishi Corporation (15%). The joint venture is proposing to build an LNG export facility in Kitimat that initially consists of two LNG processing units referred to as “trains,” each with the capacity to produce 6.5 million tonnes per annum of LNG annually, with an option to expand the project in the future to four trains.
The Haisla Nation celebrated the signing of an incremental treaty agreement with the British Columbia government Tuesday at the Haisla Recreation Centre in Kitamaat Village. The treaty will see the return of Haisla lands on the shore of Douglas Channel of Lots 305 and 306 south of the Kitamaat Village, designated Indian Reserve #2 and Indian Reserve #3, also known as the Walsh Reserve, thus connecting the two reserves.
In a news release, the BC Ministry of Aboriginal Relations and Reconciliation said that under the agreement, approximately 120 hectares of Crown land will be transferred to the Haisla Nation.
The land lies in the heart of the Haisla Nation territory and will support the community’s goal of expanding housing, commercial and public space for its members, and opening new business opportunities.
The release went on to say, “The agreement continues the productive relationship between the Haisla Nation and B.C., which is furthering economic development opportunities and improving social conditions.”
It took decades for the land to be returned to the Haisla.
At the ceremony, Allan Donovan, the Haisla’s lawyer said, “We are here to celebrate the achievement of something that should have happened when the Haisla reserves were set aside in 1889. At that point, the reseve commissioner noted the Haisla reserves were the smallest and least desirable in the whole nation.
“But he left it at that, but in the years and decades afterward, the Haisla sought to extend their reserve holdings and their lands and have done so with an increasing degree of success.
“The actual negotiations to see the lands returned actually started over 60 years ago with limited success. But the Haisla are always persistent when it comes to issues of land, when it comes to issues of justice.
“In the 25 years since then there have been a number of attempts over the years This time with Haisla leadership and cooperation from the government of British Columbia, that dream has become a reality. The land has been returned to the rightful owners, joining up these two reserves.
The ministry said the British Columbia introduced incremental treaty agreements “to help speed up the treaty process by building goodwill among parties and bringing the benefits of treaty faster to First Nations. These agreements also provide increased certainty on the land base and with natural resource development.”
At the ceremony, John Rustad, the Minister of Aboriginal Relations and Reconciliation said that so far the province has signed 18 incremental treaty agreements with various BC First Nations.
“This is a relationship building step between the Haisla Nation and the province, to lay foundations for things we can continue to do in the future,” Rustad said, “Over the past number of years now the Haisla and the province have made great strides and have a very good relationship (at least I believe a very good relationship, … As we move forward in developing our relationship.”
Rustad noted that representatives of the Shell-led LNG Canada project, Chevron and AltaGas were at the Recreation Centre to witness the ceremony.
“It’s about embracing those opportunities and ways to find a balance between environment and economics. No one has been better than the Haisla in being able to do that, working with the companies working with the province, working with their neighbors to create opportunity.
“It is through hard work and through partnerships that is truly a path forward toward building a prosperous future.
“We are very proud as a province to be working with the Haisla as a partner,” Rustad said. “We have our difference, we have things we may not agree on but I also believe very strongly that as we work together the steps to ensure prosperity for all of British Columbia but also especially for the prosperity of the Haisla nation This agreement between the Haisla and the province is an example of some of the things we can do right and we can try to correct the situations that have existed for such a long period of time, to find a way to build a prosperous future.”
Stop dwelling on the past
Ellis Ross, the Haisla elected Chief Counsellor told the Haisla and their guests. “It’s time to stop dwelling on the past and start building the future. All the pieces are there Everybody wants to help us get to a better place. Our partners from LNG Canada are here.Chevron is here. It’s everyone working together for the future, to bring the pieces of the puzzle to ensure our future generations.
“We don’t have to beg to be part of the BC agenda. We should be equal particpants.in everything in our territory. That’s what we should be focused on Stop getting distracted with the minor little differences, where infighting stopped us from the promises that have been promsed us for the past forty or fifty years.”
He said the Haisla started working with the Christy Clark government in 2009.
“We both took different approaches to our relationship We both agreed there is a common goal to be achieved if we just put aside our differences. I am not sure how many people know this but the provincial government actually helped us acquire the hospital lands (the site of the old “pink lady” hospital across from the City Centre mall)
“In terms of the water lot that the Haisla own, we’re the only First Nation in Canada that owns water lots and that ‘s because of the provinical government support for us.”
He also thanked the province for helping the Haisla lease land with an option to purchase near Bish Cove (Beese in traditional Haisla terminology) and worked with the federal government so that the Minette Bay lands could also be added to the reserve lands. He said Haisla staff consult on a regular basis with provincial officials.
“Our staff are working on permits for the benefit of the Haisla as well as everybody else. I think the Haisla are a working definition of what reconciliation actually means and it matters to the average Haisla citizen…
“There are different definitions out there about what reconciliation means. Everyone has a different definition Right how BC and the Haisla are proving that reconciliation is possible without getting into politics.
“It’s agreements like this what we’re talking about today that truly set the stage for the future of the Haisla people.
“We’re not going to be around in a hundred years but in a hundred years the future if Haislas are still talking about the same issues they talked about 50 years ago, we as leaders failed today.
“This is only one of the many agreements that we sign with the provincial govt and with LNG Canada and with Chevron and everybody else that’s willing to sit down and work out some sort of agreement with us.
“In fifty, a hundred years I am sure our descendants won’t be talking about poverty, they won’t be talking about unemployment, they wont be talking about extra land so we can build more houses. they’ll be talking about issues we can’t even understand yet but they won’t be dealing with the issues we’re trying to deal with today.
“What is the next agreement? The only thing that makes this possible is two parties sitting down and saying ‘let’s get an agreement for the betterment of all.’”
– Quick Facts:
Haisla Nation has approximately 1,840 members, with 700 people living in Kitamaat Village, at the head of Douglas Channel, about 10 kilometres south of Kitimat.
The incremental treaty agreement provides for the early transfer land to Haisla Nation, ahead of a final agreement with the Haisla.
The Province and Haisla Nation have collaborated on a number of initiatives, including facilitating negotiations for the Haisla to purchase former District of Kitimat hospital lands; the purchase of MK Bay Marina; and transfer of foreshore lots in the Douglas Channel
In 2012, Haisla Nation and the Province signed the Haisla Framework Agreement allowing for the purchase or lease of approximately 800 hectares of land adjacent to Indian Reserve No. 6, intended for LNG development. The framework agreement also commits the parties to land-use planning around the Douglas Channel, helping to create certainty and allowing other projects in the area to proceed.
Haisla is a member of the First Nations Limited Partnership, a group 16 First Nations with pipeline benefits agreements with the Province for the Pacific Trail Pipeline. Haisla and the Province also have a forestry revenue sharing agreement and a reconciliation agreement.
Haisla Nation is a member of Marine Planning Partnership for the North Pacific Coast, which provides recommendations on stewardship and sustainable economic development of the coastal marine environment.
Over the past decade, the Haisla Nation has engaged in 17 joint ventures with industries seeking to support economic activity for the region
(Source Ministry of Aboriginal Relations and Reconciliation)
April 13, 2015
On April 03, 2015 the Union ended negotiations with the District of Kitimat. The District extended another opportunity for the Union to accept the February 26, 2015 Final Offer by April 12, 2015. The Union declined that opportunity.
This morning the Union applied to the Labour Relations Board for the services of a Mediator. The District has agreed to participate in mediation.
The Mediator appointed today asked the parties to set aside May 01 – 04, 2015 as potential dates for initial meetings.
So far, Unifor 2300 has not commented on the announcement. However, Ron Poole said, District Chief Administrative Officer says both sides in the Kitimat dispute are making an effort with the Labour Relations Board to get things started faster, perhaps arranging a weekend meeting before the projected start on May 1.
Northwest Coast Energy News has confirmed postings on Facebook that said the District of Kitimat is using the services of a prominent Vancouver based employment firm, Harris and Co. If the two sides had not agreed to mediation, the law firm would have taken over the negotiations, Northwest Coast Energy News has confirmed.
Wills was hired by Prince George to serve as their chief spokesperson during collective bargaining with the Canadian Union of Public Employees locals 1048 and 399. Wills’ work helped by city to reach an agreement with CUPE after a year of negotiations. However, the city refused a request under for the Freedom of Information Act from the Prince George Citizen to find out how much Wills was paid. The Prince George budget says it pays Harris and Co. $25,000 a year.
According to Wills’ Linked In profile, she speaks fluent Portuguese.
The profile on the law firm website says:
Adriana represents a broad range of clients in both the private and public sectors. These include clients in the forest, manufacturing, service, chemical industries, local government, health care and, educational industries. She provides the full scope of legal services to those clients including: strategic planning; risk management; collective bargaining; policy development; training; and, advocacy. Adriana believes in providing practical solutions to the legal challenges faced by clients.
Wills has been with Harris and Co. since 1992. She is also an activist on mental health issues.
After both sides in the Capilano dispute agreed to mediation, the Capilano Faculty Association agreed to suspend its strike action. The university will resume operations Tuesday. Exams will begin on Thursday, April 16 and end Friday, April 24.
The District of Kitimat employees walked off the job just before midnight on February 28. There is no indication whether or not Unifor 2300 will suspend the strike as the Capilano Faculty Association has)
The Wet’suwet’en First Nation will receive approximately $2.8 million from the Province at three different stages in the CGL project: $464,000 upon signing the agreement, $1.16 million when pipeline construction begins, and $1.16 million when the pipeline is in service.
The Wet’suwet’en First Nation will also receive a yet-to-be-determined share of $10 million a year in ongoing benefits per pipeline. The ongoing benefits will be available to First Nations along the natural gas pipeline routes. The B.C. government anticipates signing similar agreements with other First Nations in the near future.
Provincial benefit-sharing offers First Nations resources to partner in economic development, complements industry impact benefit agreements that provide jobs and business opportunities, and is a way for government and First Nations to work together to help grow the LNG industry.
John Rustad, Minister of Aboriginal Relations and Reconciliation says in the release, “Too many First Nation communities have been left out of economic growth in B.C. for far too long. It’s exciting to be able to partner with First Nations like the Wet’suwet’en so they can share in the benefits of a new LNG export industry – stronger economies, good-paying jobs and collectively working to establish environmental legacies made possible by LNG development.”
The release quotes Chief Karen Ogen, Wet’suwet’en First Nation, as saying, “Pipeline benefits agreements are just one vehicle driving our participation in LNG development. While these agreements ensure First Nation communities share in the economic benefits of LNG, we are working collaboratively with the Province and other First Nations to ensure environmental priorities are addressed as well.”
The release also quotes Rich Coleman, Minister of Natural Gas Development as saying, “Our government continues to build strong partnerships with First Nations as LNG development gains momentum. Pipeline benefits agreements like this one pave the way for job creation and economic growth as we work together to further the potential of our natural gas sector.”
The news release says the Wet’suwet’en First Nation is among the 15 First Nations located along the Chevron/Apache Pacific Trail Pipeline route that have already signed agreements that will provide $32 million in benefits to First Nations once construction has started.
British Columbia issued an environmental assessment certificate for the proposed CGL project this fall. In addition to meeting conditions set out in the environmental assessment certificate, the project will now require various federal, provincial and local government permits to proceed.
When the certificate was approved in October, the Office of the Wet’suwet’en, which represents hereditary leadership issued a release saying:
B.C. ‘s approval of Coastal GasLink Pipeline project does not mean the project is a go. The Wet’suwet’en still have the right to determine the use of the land and our future.
Not enough information has been made available through the regulatory process to determine environmental impacts nor infringements to Wet’suwet’en rights title and interest.
Current benefits offered by the province and pipeline companies do not take into account the impacts and infringements to our lands, culture and community well-being, for today and into the future.
One group, the Unist’ot’en Camp, representing one house of the Wet’suwet’en continues to camp out in the bush, and the group says they are determined to block any pipeline construction within their traditional territory.
In its news release, BC says, benefits agreements are separate and different than industry impact benefit agreements. Pipeline benefits agreements are made between the Province and First Nations, exclusive of proponents. Impact benefit agreements are made between proponents and First Nations, exclusive of the Province.
The province of British Columbia has posted a request for bids for an extensive air shed study for Prince Rupert, a study that has much wider scope that the controversial Kitimat air shed study. The maximum cost for the study is set at $500,000.
a study of potential impacts to the environment and human health of air emissions from a range of existing and proposed industrial facilities in the Prince Rupert airshed, further referred to as Prince Rupert Airshed Study (PRAS) in North West British Columbia.
The “effects assessment” should include the “prediction of effects of existing and proposed air emissions of nitrogen dioxide, sulphur dioxide and fine particulate matter (at PM2.5, called dangerous by Wikipedia ) from “an existing BC Hydro gas fired turbine, a proposed oil refinery, and seven proposed LNG export terminals (Pacific Northwest LNG, Prince Rupert LNG, Aurora LNG, Woodside LNG, West Coast Canada LNG, Orca LNG, and Watson Island LNG).”
In addition to “stationary sources” of nitrogen dioxide, sulphur dioxide and particulate matter, “the impact assessment will also include rail and marine transportation sources of these contaminants in the study area.”
The request for proposal goes on to say:
The identified sources will be used for air dispersion modelling to determine how the contaminants in various aggregations (scenarios) will interact with the environment, including surface water, soils, vegetation and humans. Interactions of interest will include:
– water impact mechanisms related to acidification and eutrophication;
– soil impact mechanisms related to acidification and eutrophication; and
– vegetation and human health impact mechanisms related to direct exposure.
Water and soil impact predictions will be based on modelled estimates of critical loads for both media, given existing and predicted conditions in the airshed. Vegetation and human health impact predictions will be based on known thresholds of effects, given modelled existing and predicted conditions (contaminant concentrations) in the airshed.
Although the documents say that the Prince Rupert study will be based on the same parameters at the Kitimat air shed study, the Kitimat study only looked at sulphur dioxide and nitrogen dioxide, and did not include particulate matter.
Environmental groups also criticized the Kitimat air shed study for not including green house gases. The proposed Prince Rupert study also does not include green house gases.
A draft report is due by March 15, for review by the province and affected First Nations and subject to peer review. The District of Kitimat was not asked for comment on the study on that air shed study, even though scholars as far away as Finland were asked to review it. It appears that Prince Rupert itself is also excluded from a chance to review the study. The final report is due on May 15.
The province has issued a permit to Rio Tinto Alcan to increase sulphur dioxide emissions from the Kitimat Modernization Project. The Environmental Appeal Board will hold hearings in January 2015. Elisabeth Stannus and Emily Toews, from Kitimat, have appealed against decision to allow RTA to increase sulphur dioxide emissions.
Kitimat voters in the upcoming municipal election should carefully, very carefully, consider who are the best candidates that will, as much as humanly possible, produce a “world class” municipal mayor and council.
Northwest Coast Energy News will not endorse any individual for mayor or council in the 2014 municipal election.
However, this election is probably the most important in the District’s history and so this editorial will outline the issues facing the District of Kitimat.
When that council takes office in January 2015, it must have one item high on the agenda. Plan B. That’s B for Bust. In the past few days, just as the nomination process closed for municipal candidates, the world’s commodity markets began showing a sharp downturn and that commodity downturn will be a factor, like it or not, during the years that the new council will be in office.
The term “world class” has been bandied about a lot recently, especially by BC Premier Christy Clark and Prime Minister Stephen Harper. But that “world class” term has largely been political spin. For Clark it gives her government a hall pass if they decide, in the end, that Northern Gateway isn’t worth the trouble. For Stephen Harper, “world class” is nothing more than a propaganda term.
When it comes to Kitimat, however, it is wise to take the term “world class” seriously. How many small town councils have to deal with the world’s second largest corporation, Royal Dutch Shell, the twelth, Chevron and, if Glencore takes over Rio Tinto, the tenth? How many small town councils have to deal daily with federal and provincial governments, governments that while praising Kitimat for its potential really want to bury it by taking for themselves much of the advantages that industrial development could bring here?
There is already one world class local council in the region, just down the road in Kitamaat Village, the Haisla Nation Council, which shows that with strong, intelligent and determined leadership, a small group can come out ahead in tough negotiations with giant transnational corporations and the governments. Yes, rights and title do give the Haisla Nation a negotiating and legal advantage, but a paper advantage is useless without vision and as Chief Counsellor Ellis Ross has said in interviews, the abiity to learn from mistakes and apply those lessons. We’ve heard people say that if Ellis Ross ever chose to run for mayor of Kitimat (which he wouldn’t because he is focused on improving the lives of the Haisla) he would win in a landslide.
The present council has had a couple of major failures, both with the Northern Gateway project. The first was the failure to participate in any way with the Joint Review process. Council chose to be neutral, and stubbornly maintained that neutrality meant sitting out the entire Joint Review hearings rather than participating in such a way that the Kitimat was properly represented during the hearings without taking a stand one way or another. The Haisla intervenors ablely not only represented the interests of the Nation, by default the Haisla often represented the interests of the entire district before the JRP. The second was the plebisicite which had a convoluted question and protracted disageement on how the plebisicite should be managed.
The question for voters is have those candidates for mayor and council who are part of the present adminstration shown a willingness to learn from those mistakes and do better in the next four years?
Which candidates for mayor and council have the intelligence, determination and vision to quide Kitimat during the next four years. Which candidates have the negotiating saavy and yes (whether male or female) cojones to get the best deal for the District in the coming years?
Access to the ocean
The big issue in this election, whether or not we are in a boom or a bust, is action to ensure that the residents of Kitimat have unimpeded access to the ocean for both casual recreation and for boaters. That means Kitimat needs a tough, determined council that is willing to really represent the residents in in the water access issue.
When it comes to the Regional District’s actions on the sale of MK Marina, the District of Kitimat has acted like a wimp. The attitude seems to be well, Kitimat has only one vote on regional council and the rest of the region doesn’t really care, so there’s nothing we can do about it. True leadership would be finding an imaginative way to make sure the interests of the people of Kitimat in gaining access to the ocean are not lost in regional council indifference.
It also means that there must be better relations with the Haisla Nation and a way around the fact that Rio Tinto controls far too much of the waterfront.
There’s also the long term problem that the federal government decreed two years ago, without consulting either the District or Rio Tinto, that the private port would become a public port. We’ve heard nothing about that since but the Harper government’s potential interference with the port of Kitimat cannot be ignored.
That may mean hiring additional staff. This site has said time and time again the District needs its own in house staff city solicitor who can deal with all the issues that come up, rather than depending on occasional legal advice from a lawyer on retainer. If the district can hire smart planners and economic development officers, it should also bring back the position of “harbour master” which existed on paper some years ago and that way there would be one district staffer who could use that title (even if conflicts with the feds) to work full time on ocean access.
One thing is certain, all members of the current District Council have had a huge work burden during the past three years, a work burden far beyond anything that is normal for a small municipal council in a town of 8,000 people. That work burden will likely increase during the next four years.
Experience counts. Voters should ask which councillor and mayoral candidates have handled that work burden the best? Which of the candidates, new or old, are genuinely willing to take on that burden, which will range from negotiating (within the powers of a municipality) with some of the world’s giant corporations, many with a century of more of negotiating experience, while at the same time dealing with perennial issues like snow clearing in the winter, garbage collection during bear season and deciding which of Kitimat’s unique system of sidewalks need to be fixed this year?
There are at least two positions on council that are up for grabs by new comer candidates. Who ever wins those positions will change the makeup of council, may even change the voting pattern (which during the current situation was often four to three one way or another, with Corrine Scott who is not running again, often, but not always, casting the deciding vote). So the voters should listen carefully and decide no matter what their position on all issues, who are the candidates that will strengthen the overall council.
One issue candidates
While we won’t know for certain until the debates, there appear to be a number of one issue candidates running, candidates that, it seems, want to refight both sides of the Northern Gateway plebisicite.
Unless these candidates show a wider vision the voters should reject those candidates.
On the “pro development” side there is a strange notion that if Kitimat could only elect a council that welcomes any industry, any time, then the world will beat a path to our door. That’s not only a fantasy, it’s a bad negotiating tactic as Christy Clark has found out. Clark in her provincial election campaign put all her political eggs in the LNG basket and (to mix metaphors) now the LNG industry is calling her cards and Clark has very little in the pot and a very weak hand. The big corporations would love a council that comes begging, cap in hand and will take any handouts the company may offer. Just look at Petronas and what it is demanding (not asking) from British Columbia.
On the other hand, a candidate who is stubbornly on the environmental side is also a danger to the future of the district, since that candidate may also be an impedement to tough negotiations needed to protect the district’s environment including the Kitimat airshed, the Kitimat River and the Kitimat Arm.
Electing a council that is unbalanced either on the pro development side or the pro environment side will solve nothing and will only increase the polarization in the community.
Electing one issue candidates who care only about one side or the other energy debate while it may give some voters satisfaction, will likely mean that these candidates, if elected, will not be working hard on the day-to-day municipal issues like water, sewerage, snow clearing, how many books the library has or unraveling the recycling condundrum.
So cast your ballot for those candidates best suited to take on the world, while at the same time making sure the sidewalks are safe.
“Is there a longterm vision for Kitimat?” Spencer Edwards, one of the public delegates, asked District of Kitimat Council Monday night, August 18, as there was yet another public hearing on the highly controversial development on Kingfisher Avenue.
If there is a vision for the future of development in Kitimat, it appears, to say the least, that both Council and the overworked Community Planning and Development division are struggling to find something. It is more likely that with the sudden increase in development, that both Council and staff just don’t have time to “do the vision thing.”
The growing objections to the Kingfisher development of either 40 or 53 townhouses and a second development Riverbrook Estates, that would be beside the Dyke Road off Kuldo near to the Riverlodge Tennis Courts, a mix of single family homes, townhouses and apartments, shows the vision gap.
Public delegations are demanding just that— a vision.
At council meetings over the past weeks, a number of delegates have referred to Clarence Stein’s original vision for Kitimat from the 1950s. A note to Council from the residents of Marquette Street presented in opposition to the Kingfisher development says:
This is not what the famous American Architect, Urban Planner and Founder of the Garden Cities movement, Clarence Stein had envisioned a modern town with a population of 50,000 resident when he designed Kitimat over 60 years ago. He would be turning inside his grave.
Stein asked the same question. In his plan for Kitimat (page 45) he said future councils, staff and developers must ask: “What do the people themselves want?”
It’s fairly obvious by now that what the people of Kitimat want is more housing—there is, after all, a housing shortage at the moment. It also crystal clear that the residents of Kitimat do not want cookie cutter town houses and apartments built, as the Marquette note says “as is happening in Surrey, Port Coquitlam and so many other places in the Lower Mainland.”
“Kitimat is full of hicks”
While developers (just like energy companies) come before Council and make presentations of their vision, with assurances of respect for this community, there is a dark side.
When the developer delegations left the Council Chambers Monday after their presentations, some of them were overheard by witnesses in the parking lot disparaging what had just gone on inside from both council members and citizen delegations, saying that “Kitimat is unsophisticated”….”doesn’t understand how things were done in the big city” and… “Can’t make up their minds.”
As one of my sources who overhead the conversation remarked, “They must think Kitimat is full of hicks.”
While it is uncertain which of the developer and real estate delegations made the remarks in the dark, it is clear if that is the real attitude toward development in Kitimat, then vision, not “let’s get on with it” must be the priority.
There must be strong development regulations to ensure that anyone building in the District must be held strictly to account to keep those assurances (and not be allowed to say market conditions have changed to get out of any commitments). More than that what Kitimat needs and needs now is an updated version of Stein’s vision, not the “motherhood” statements found in the current Official Community Plan.
So Kitimat, do you know the way to Santa Fe? (We’ll get there in bit).
Unfortunately the OCP is more of a motherhood document than a plan for the future of Kitimat. It’s also obsolete: a 2007-2008 rewrite of the original 1987 plan, updated with a few paragraphs in 2013 (as required by law, it is reconsidered every five years) There’s an already obsolete table predicting continuing decline of Kitimat’s population over the next quarter century (although a nearby graph does include possible population increases as well as declines).
On the future of Kitimat, the opening paragraphs read circa 2008
Kitimat’s population, after peaking in the mid-80s, has been in a general decline to fewer people than in 1956, primarily because of external factors beyond the control of the local municipality. Kitimat, like many other rural communities across Canada, is being affected by world markets and resultant demographic shifts as economic power and population is concentrated in major metropolitan centres. It is hoped that population will grow again and there are potential projects that would support this. New industry may locate here or existing businesses may expand based on the deep sea port, relatively low-priced land, and the proximity to natural resources. Kitimat’s future remains uncertain.
Even with the few updates in 2013, it seems no one expected the current building boom. That means the OCP can’t handle the boom, whether or not it continues or fades away.
The problem facing those who want development in Kitimat is that much of provincial law is pretty clear, a developer looks at the OCP, which has little specifics, then the zoning and then, if everything is in order, apply for a development permit, gets it and the goes ahead.
At Monday’s meeting, Edwards asked, “Is there any indication of what quality of development is being put in place?”
Deputy Administrative Officer, Warren Waycheshen, replied that the zoning plan for the Kingfisher development “allows what the setbacks are going to be, height, distances, it doesn’t set the building quality. That will come through the development permit stage.”
There have been the same arguments over and over in Kitimat in the past year, where a new developer or a developer doing renovations, often from out of town, were able to go ahead and do what they wanted, with little regard for the residents of Kitimat, its history and the vision of Clarence Stein.
This brings me to Santa Fe, how Kitimat can maintain Stein’s vision and how Kitimat can use the development permit process to ensure that happens. That means an urgent program of updating and strengthening the development permit system to reflect Stein’s vision across the district.
Santa Fe, New Mexico, was a crossroads of the Old West, home of the Pueblo First Nation which for centuries before the coming of Europeans built pueblos out of adobe. Adobe (not the software) is an old Arabic word meaning “mud brick” adopted into Spanish during the time of the Moors, brought to the New World and used by the Spanish in New Mexico, and taken up by the Americans who came via the Santa Fe Trail and then the railhead for the Atchison, Topeka and Santa Fe Railway.
In 1912, New Mexico became the 47th US State; Santa Fe became the capital.
At the same time, the Santa Fe local government adopted the 1912 equivalent of a BC Official Community Plan,
In 1912, when the town had only 5,000 people, the city’s civic leaders designed and enacted a sophisticated city plan that incorporated elements of the City Beautiful movement, the city planning movement, and the German historic preservation movement. It anticipated limited future growth, considered the scarcity of water, and recognized the future prospects of suburban development on the outskirts. The planners foresaw conflicts between preservationists and scientific planners. They set forth the principle that historic streets and structures be preserved and that new development must be harmonious with the city’s character.
The end of the fabled trail of pioneer days, Santa Fe is today the oldest state capital city in our nation. And if its earth-tone structures hark back to the Pueblo originals, well, that’s by design….. Almost a century ago, city fathers mandated use of the style all over town, predicting — accurately, as it turned out — that it would be good for the tourist trade. Today, even fast food outlets and big box stores are clad in Santa Fe style.
That CBS report was right on. I visited Santa Fe a few years ago, and noted how much of the town, especially the famous art galleries reflected that adobe style. The big box stores and the fast food joints are the same—and who cares about corporate building branding; the familiar signs were all that was needed.
What struck me was a mall I saw on the outskirts of town while driving to the airport. It was a mall, in many ways no different from the boring cookie cutter malls you see in Surrey, Coquitlam or Nanaimo—with one exception. It was built in the Santa Fe Adobe Style and looked a whole lot better than the uniform malls you see from almost every highway in North America.
Editor’s Note: CBS News Sunday Morning is scheduled to repeat its special report on Santa Fe By Design, this Sunday, August 24. Due to sports programming Sunday Morning is usually pre-empted in the Pacific Time Zone. If you have cable or satellite and access to a CBS east coast station, watch or set your PVR from 0900 to 1030 ET (0600 to 0730 PT)
That is what “new development must be harmonious with the city’s character” means and that’s what Kitimat should do. Make sure all future development is truly harmonious with Kitimat’s character.
Not that there aren’t the usual tensions and disputes over what harmonious means. As the Wall Street Journalreported last year, there is now some resistance to the old style among residents, including those outside the municipality’s jurisdiction or away from the historic districts where the rules are the strictest.
As the Journal reports:
a new wave of contemporary homes is springing up around the city’s less regulated outer edges, transforming the once uniform landscape and pushing southwestern design in new directions. Glints of glass and steel are now dotting the city’s earth-toned desert surroundings
Some home owners want to be completely contemporary and get away from the adobe style. On the other hand, as the Journal reported, some architects are working on innovative designs that blend the adobe style with the ultra modern:
Some local architects aim to meld traditional and contemporary architecture in their designs. While traditional materials of adobe homes—stucco and plaster walls, for example—are still used in many contemporary homes, the lines on modern designs are crisp and clean instead of rounded. Many of the contemporary homes around Santa Fe are characterized by large expanses of glass, clerestory windows and skylights—sometimes in unexpected places, such as in laundry rooms and showers—and muted stucco exteriors accented with steel that blend into the landscape.
Although Kitimat Community Planning and Development says on their website that Stein’s Townsite Report is a “must read,” it is doubtful that any of the developers have actually read it.
Note also that the Garden City concept that was the foundation of Kitimat was itself, in part, based on the now century-old City Beautiful movement that gave Santa Fe its character.
So there is a connection between the design of that desert city and this small town in the rainforest of the Northwest.
After Monday’s Council meeting, I asked Warren Waycheshen if there were any “heritage” or “look and feel” policies in British Columbia. Waycheshen told me that while it is difficult to mandate “harmonious character” and “blending into the landscape” at the zoning level, it can and has been done at the development permit stage in a few BC communities.
(And for those developers who think that wanting harmonious development is “unsophisticated,” well they can look at Santa Fe and Whistler)
Up until now in Kitimat, some in politics, some in the real estate and development communities have had an Oliver Twist approach, saying to every developer “Please, sir can we have some more?”
So far none of the designs presented before Council for any development have shown any innovation or imagination. None of them have any harmony with Kitimat’s character
. Even with the need for housing, there is time to slow things down and reconsider whether taking “off the shelf” projects originally designed for the land crowded Lower Mainland are right for Kitimat.
That’s because none of the Liquified Natural Gas projects are anywhere close to the Final Investment Decision Stage.
Many of the delegations to Council have warned about overbuilding and the possibility that slap dash, cookie cutter development could quickly deteriorate into slums if the boom doesn’t happen. There is some limited time to consider all the issues. Most residents who live around the Kingfisher development would prefer buildings with a higher quality that could be sold on the basis of its proximity to the golf course. There are fears that many developments, based on the Lower Mainland “build higher” philosophy would be inappropriate for seniors.
There is one consideration—that is the size of buildings. Both District Staff and developers cite changing demographics (average household size dropping from 3.2 to 2.4 persons) and the fact the large single family homes, such as the “berry” development by Oviatt Construction are too costly for young families who would prefer and could afford townhouses.
We have to ask what kind of townhouses? The original Stein report, in a chapter written by planning subcontractors Mayer and Whittlesey noted on page 220,
Larger-than-normal houses, for people will stay much indoors; covered terraces and breezeways where children can play. A large number of houses should have a cellar or attic space for workbench and game table. Provision of wood burning fireplaces should have special consideration, as a focus of interest and cheer in a rainy climate.
So smaller houses for affordability or larger houses so people can get through the fall and winter without getting cabin fever? Just how much Seasonal Affective Disorder happens in Kitimat? And beside the weather, people are staying indoors a lot of these days watching satellite TV, playing video games and on the Internet. All factors the developers aren’t considering.
Have Kitimat’s planners and builders ever considered how home design might help alleviate SAD?
Let’s throw out the boxes and have the architects go back to the drawing board or AutoCAD and design a townhouse that is right for Kitimat.
There are a lot of worries about snow clearing and parking in the narrow streets of the proposed developments. While district staff say the Kingfisher development meets “municipal parking standards” perhaps all those concerns by experienced long-time residents mean that those standards should be reconsidered rather than used as a rubber stamp.
It’s amazing that in the late 1940s and 1950s a bunch of men in New York (yes men, Stein, the man of his age, calls for planning by men) who at first had never been here, could imagine and create the Kitimat that became “the town of the future,” while today developers from Vancouver, Calgary or wherever do nothing more than pull an AutoCAD file off a hard drive, make a few tweaks and cosmetic changes and then try to convince residents, staff and council that this will be great for Kitimat.
Yes many of the original houses in Kitimat were “off the shelf” at the time but they were also often new and innovative for the 1950s. This is a chance to create a new vision but practical vision for the 21st century. The provincial government has mandated all community planning must consider climate change. There is no indication at all that the current development designs take climate into consideration.
What must be done
It’s time for Kitimat to rewrite the development permit standards, so that the original Stein vision is incorporated into every future development, whether residential, commercial, industrial or institutional. Some of the ideas will have to be updated from the 1950s to reflect changes in demographics, economics and technology. If Santa Fe, a modern hub of artistic and high tech innovation can do it, Kitimat can do it on a smaller scale.
Since time is somewhat tight, ask the current developers, on a voluntary basis, to submit new ideas that show their projects won’t be just another subdivision in Surrey, new designs compatible with Kitimat. If developers want to build here, now and in the future, they are going to have to use their imagination and skill to bring Stein’s vision into the 21st century. Tell the developers that now they have to prove to Kitimatians that they don’t really believe this is a hick town.
Update development rules and guidelines
District staff, Council members, the Housing Committee and other interested groups should take a crash look at development guidelines and development permit rules and as soon as possible update those that can act as a guideline for future changes that reflect the Stein vision.
Hire a District Solicitor
We recommended this during the Enbridge Northern Gateway Joint Review hearings and when the LNG companies began environmental review. All the problems with potential development again show the need for a full time District Solicitor who will be in the District offices working with staff and members of council and attending council meetings to understand the needs of the residents of Kitimat on all issues. Having a lawyer on retainer who is not involved with community is no longer an option.
Overhaul development rules and guidelines
Continue the work recommended for the short term and have staff, locally based developers and locally based engineering companies familiar with Kitimat form a task force to overhaul the development rules and guidelines so that developments fit into both an updated Clarence Stein vision and the uncertain economics of this region
A new Official Community Plan
The current “maybe this, may be that” Official Community Plan is completely inadequate for the needs of Kitimat. It is little more than a collection of database copy and paste, motherhood bureaucrat speak with no significant reference to Stein’s original vision.
The community needs an OCP that has a strong, well-defined two track approach, one that assumes the LNG boom will go ahead, that Kitimat will grow, and a second that assumes that the new industry might pass us by and Kitimat may have to revert to planning diversification with an emphasis on tourism.
That also means looking for and hiring the Clarence Stein of the 21st Century, whether that person is in New York, Vancouver, London or Singapore.
The current OCP was largely written by Stantec, which seems to be the go-to consulting firm for everyone. While the involvement of Stantec may not have been an issue in 2008, Stantec is the same company that is now working for Enbridge and most of the LNG projects. That is a clear conflict of interest.
Kitimat needs a visionary who can build on what Stein and his colleagues did 60 years ago. While Stein was working for Alcan, what is needed in 2014 and beyond is truly independent consultant, not one serving a dozen different masters.
That includes maintaining harmony with the forested nature of the region. Without going completely the same way as Santa Fe, perhaps future construction in Kitimat should conform, within market conditions, to a style that reflects the demands of building in the northwest, like heavy snow loads and long days of dreary rain while at the same time is more reflective of the northwest natural environment. That means including the brilliant idea of sidewalks and green spaces at the back of houses, not just boxes on standard suburban streets. That doesn’t have to mean duplicates of First Nations’ longhouses or settlers’ log cabins.
A Kitimat “look and feel” should challenge architects to create a style that says Kitimat and the northwest while at the same time drawing plans that are economic for both the developer and the buyer, just as architects in Santa Fe are bringing a century-old vision into the 21st century.
If the current crop of developers think that Kitimat is unsophisticated, doesn’t understand what goes on big cities, and takes too long to make its mind, well we live here and you don’t and you won’t. If Kitimat does have a rosy economic future, it is highly likely that the community and district can find developers who aren’t in-and-out carpet-baggers but who will build something that will make a profit, be affordable for the buyer and be harmonious with the community and Stein’s vision updated for the 21st century.
As Stein asked, “What do the people themselves want?”
Editor’s note: My late father, Frederic Rowland, was Alcan’s assistant property manager in Kitimat, involved in town planning from Vancouver in the mid-50s and in Kitimat from 1957 to 1965 and thus one of the Alcan staff charged with implementing Stein’s vision.
Apache will “completely exit” the Kitimat LNG project, company CEO Steven Farris told investors Thursday as the company reported its second quarter results.
The pull out from Kitimat is part of a plan by Apache to spin off assets that are not part of its “base business” so it can concentrate on its “North American onshore assets.”
“We have said for some time that Canada is part of our North American onshore portfolio,” Farris told analysts in a conference call.
“Certainly we have two businesses up there. [in Canada] We have a business which is a base business with respect to the Duverney Shale and Monteny shale and some of the other things we working on there. We also have the Kitimat-Horn River- Liard. Kitimat -Horn River -Liard is part of our LNG project which we reindicated today that we intend to exit.”
The Horn River and Liard natural gas fields would have served the LNG project. The divesture could either be as a complete package or sold separately perhaps through the capital markets. The Duverney Shale and Monteny shale plays are considered North American assets, while the Horn RIver Liard plays are considered international because the product from there would be sold in Asia via an LNG terminal.
Chevron, the 50 per cent partner with Apache in Kitimat LNG, said it would have no comment on the Apache move until its own investor conference call Friday morning.
Apache also intends to divest its stake in the Australian Wheatstone LNG project, where Chevron is also a partner.
It was about 18 months ago, Farris said, that Apache changed its focus to “enhancing its North American onshore resource base… We’ve also made it clear that there are no sacred cows as our efforts continue.”
Change in company strategy
Farris and other executives repeatedly emphasized on the call that the Kitimat and Wheatstone sales were part of an overall change in company strategy.
“I have to honestly say that the complete exit by Apache will not have an impact on Kitimat going forward one way or another,” Farris said.
“Whether we’re in it or not, they will contact with world class reserves and frankly Chevron and Apache are way a head of anybody else in that arena. We’ve always been in a position that we felt we could not be in these LNG projects. I think it’s important that we state that.”
Some other financial analysts on the call seemed a little skeptical about the move, with a couple of questions focused on whether Apache was giving up long term investments.
“In terms of business and priority of capital and time frame of LNG specifically Kitimat it make sense for someone to own it who has a different timeline,” Farris said.
As for the timing of the sale, both Farris and Chief Financial Officer, Alfonso Leon, would not give specifics. “We haven’t decided on a specific timeline, we are working on a number of different opportunities,” Leon said. “Each of them has a different timeline associated with it. So we will make decisions as we reach decision points. Specificaly on the separation work flow…it is not something that will be executed on an imminent basis. Work has been underway but there is still significant work ahead of us.”
The executives would not say how much Apache has spent on Kitimat LNG so far, but it has been estimated at $2 billion just this year.Upgrading the old forest service road to a modern highway capable of supporting heavy truck traffic was estimated to cost $25 million Kitimat LNG officials said late last year.
As for the selling price, Farris said that company will hold out for the best deal, saying that Apache has got a “fair price” for international assets that is has already sold, adding that when it comes to Kitimat and Wheatstone. “We won’t sell at prices that don’t make sense,” whether that comes from a package deal with the northeast BC shale assets or through the capital markets.
Overall, Apache Corporation is making money, announcing second-quarter 2014 earnings of $505 million Net cash provided by operating activities totaled approximately $2.3 billion in second-quarter 2014, compared with $2.8 billion in the prior year, with cash from operations before changes in operating assets and liabilities totaling $2.2 billion, compared with $2.6 billion in second-quarter 2013.
In the quarterly report news release, Farris said, “Record-setting performance by our Permian Region continues to drive strong results for the company… Apache’s onshore North American liquids production increased 18 percent on a pro forma basis in the second-quarter 2014 compared with the same period a year ago”
Although some enviromental groups and First Nations are claiming victory in the Apache divestiture, it is clear that those activities had negiligble impact on the decision, which was driven in part by the demands of a New York hedge fund and by the growing uncertainty in the LNG market as Asian countries seek natural gas at much lower North American prices. As the old Godfather movies often said, “It’s not personal, it’s business.”
Apache’s exit, however, does increase the uncertainty in both the short term and long term development of LNG export terminals in northwestern BC, and clearly shows that Premier Christy Clark made a mistake in promising that the provincial economy will boom thanks to LNG.
Both Premier Clark and LNG Minister Rich Coleman were unavailable to the media Thursday. Coleman’s office did send an e-mail tothe media saying, “With 16 LNG proposals involving over 30 partners, we recognize partnerships will change over time, as companies make decisions that make commercial sense for their business. It’s the nature of the business and the energy sector.”
Little noticed in the media attention over Apache, was the fact Royal Dutch Shell also issued its quarterly report early Thursday. Unlike Apache, Shell is still investing in LNG projects around the world, and getting returns from existing LNG projects, while divesting under performing natural gas assets both upstream and downstream. There is no mention of LNG Canada and Kitimat in the report. In a statement issued with the quarterly report Royal Dutch Shell Chief Executive Officer Ben van Beurden commented in part:
I am determined to get a tighter grip on business performance management in the company, and improve thebalance between growth and returns. Our financial performance for the second quarter of 2014 was more robust than year-ago levels but I want tosee stronger, more competitive results right across the company, particularly in Oil Products and NorthAmerica resources plays….
Sharper accountability in the company means that we are targeting our growth investment more effectively,focusing on areas of the business where performance improvement is most needed, and driving asset sales innon-strategic positions….
We see attractive growth opportunities there such as natural gas integration and liquids-rich shales. We are taking firm actions to improve Shell’s capital efficiency by selling selected assets and making tougher project decisions. We have completed some $8 billion of asset sales so far in 2014. This represents good progress towards our targets to focus the portfolio, and to maintain the financial framework in robust health.