While Canada has been a major natural gas producer and exporter for decades, growing Asian demand means that we need to ramp up development of our LNG supply chain.
This challenge and related issues are described in Sea change? LNG on the horizon which is a call to survey global trends and realize the potential of LNG for all Canadians.
Our location and stable political landscape give us a tremendous advantage over other countries, but with natural gas potentially available from a resurgent U.S. and from Australia which is expected to overtake Qatar in world LNG export leadership within the decade, time is of the essence.
Development will be capital-intensive and LNG investors will not be able to rely on sky-high commodity prices to absorb cost overruns.
And there are domestic political, economic and social issues to consider as well. For instance, Canada doesn’t have enough people with the right skills to build mega energy projects.
Canada has a bit of an edge over the U.S., but the projects must come in on-time and on-budget. And in Deloitte’s estimation, the window to secure LNG contracts and get to market is about five years.
There is considerable risk but as long as stakeholders pursue an engagement strategy—working together to share this risk—all stakeholders will be able to share in the resulting prosperity for many generations to come.