The Canadian Association of Petroleum Producers (CAPP) has welcomed the federal government’s tax reclassification for potential LNG export facilities.
The move enhances Canadian competitiveness and supports the continued success of the country’s upstream natural gas industry, according to the CAPP.
"LNG development presents a tremendous economic opportunity for British Columbia and Canada, and is vital to the long-term viability of the Canadian upstream natural gas industry and the substantial benefits that flow from it," explained CAPP President and CEO, Tim McMillan.
"The tax reclassification recognises the need for a globally competitive business environment and will help create a more level playing field. It will also enhance our ability to attract the significant investment capital needed to establish a Canadian LNG industry and grow upstream production."
Other gas markets?
Canadian natural gas continues to be displaced in markets in Canada and the US because of supplies closer to these markets and without access to new global markets, could constrain Canadian natural gas production by approximately 40% by 2030. On the other hand, the International Energy Agency (IEA) forecasts global natural gas demand to increase approximately 60% by 2040.
McMillan concluded: "The IEA forecast also underscores the heavy competition for LNG development - the United States and Australia are projected to become major players - and notes the relatively high production cost of Canadian natural gas that's needed to supply proposed LNG facilities. This makes the federal government's announcement all the more important for our industry and creates opportunities to access new markets for Canadian resources."
Adapted from press release by Katie Woodward
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/23022015/capp-welcomes-lng-tax-break-292/