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Steelhead LNG signs opportunity development agreement

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LNG Industry,

Steelhead LNG Corp. and the Huu-ay-aht First Nations (HFN) have signed an Opportunity Development Agreement to explore developing a LNG project on HFN-owned land at Sarita Bay, approximately 10 km north of Anacla at the southern end of Alberni Inlet on Vancouver Island, Canada.

The LNG project would include a land-based liquefaction facility, and would ultimately represent an investment of US$ 30 billion. The LNG project would also create hundreds of direct jobs from design through construction, and hundreds of additional full-time operational jobs. If the LNG project goes ahead, the LNG facility would run for at least 25 years.

Exploring infrastructure options

Steelhead LNG has applied to the National Energy Board for a license to export up to 30 million tpa of LNG for 25 years. The development of the Sarita Bay site would be split into four 6 million tpa LNG production trains, which is reflected in the application. Steelhead LNG is currently working with pipeline companies to explore infrastructure options to deliver the gas from northern British Columbia (B.C.) to western Vancouver Island, and options for an additional 6 million tpa LNG export facility along a pipeline route.

Steelhead and HFN were introduced by the Port Alberni Port Authority (PAPA), which developed strong relationships with both parties as part of its mandate to foster economic development in the region. In 2013 the PAPA entered into a Protocol Agreement with HFN to collaborate towards achieving initiatives such as this proposed LNG project.

First Nations input in LNG projects

The LNG project, which is being overseen by a joint Steelhead LNG/ Huu-ay-aht First Nations Project Development Panel (PDP), represents a unique approach and an increased level of First Nations input and direction in an LNG project. The project will be subject to several comprehensive regulatory, environmental and technical assessments and will only proceed after extensive consultation with Huu-ay-aht citizens, including a vote on a possible land lease to the project at the Huu-ay-aht First Nations People’s Assembly in November 2014.  PAPA would continue to be involved with the port development, marine and shipping related aspects of the project.

In order to collect ongoing input and feedback from Huu-ay-aht First Nations citizens, as well as from other stakeholders, the PDP will put in place a number of community engagement initiatives including a community office in the Bamfield/Anacla and Port Alberni areas, a project website, Community Rounds (meetings) for HFN citizens, community meetings, and regular project updates.  These consultations will begin before, and continue after, the 2014 HFN People’s Assembly.              

Nigel Kuzemko, CEO, Steelhead LNG, said: “We look forward to working closely with Huu-ay-aht First Nations to explore LNG opportunities […] While the site is a significant distance from upstream gas production, it does offer numerous advantages, including direct access to the Pacific Ocean. This agreement at the earliest stage of the project reflects our commitment to the Huu-ay-aht First Nations and our respect for their principles of iisaak (greater respect), hishuk tsa-walk (everything is connected) and uu–a-thluk (taking care of). We were also very impressed by the level of collaboration between Huu-ay-aht First Nations and the Port Alberni Port Authority. We see this kind of collaboration as an enabler for projects of this magnitude.

“It’s important to note that this agreement represents only the first step in our journey together. We recognise that between now and the time the first shipment of LNG might leave our proposed facility, thousands of decisions will have to be made and we have to get every one of them right, or that shipment doesn’t leave. In addition, the decisions we make together will be measured against our joint responsibility to ensure the lands on which we hope to operate are safeguarded for generations to come.”

Protecting land and interests

As part of the Opportunity Development Agreement, Steelhead LNG will provide HFN with capacity funding so the Nation can secure the technical, environmental and negotiating expertise it needs to protect its land and its interests. Steelhead LNG and Huu-ay-aht First Nations will also work together on a social benefit and community engagement programme.

“Today’s announcement showcases our unique approach to developing LNG projects,” said Kuzemko. “By operating as a flexible and focused BC-based company that isn’t constrained by commitments to worldwide projects, or non-LNG energy sectors, we hope to create a project and partnerships that for many years to come will generate opportunities for the Huu-ay-aht people as well as BC-based businesses providing engineering, construction, accommodation, marine, transportation and other LNG sector-related services. 

“We also believe that Canada has the entrepreneurial, educational and natural resources to become a world leader in the responsible development of LNG. To that end, we are committed to helping develop Canada’s financial, organisational and technical capacity to achieve that goal and ensure the benefits of LNG extend to all Canadians.”

Adapted from press release by

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