Natural Gas and the LNG Opportunity in British Columbia


B.C.’s Natural Gas

  • Production – 2.1 trillion cubic feet (Tcf) per year –36 per cent of Canada’s overall natural gas production in 2021 (Source: CAPP Stats handbook). 
  • Natural gas is significant part of B.C.’s clean energy export economy: 69 per cent of the natural gas produced in B.C. is delivered to other regions of Canada, 23 per cent is exported to the U.S. and 10 per cent is consumed within B.C. (Source: Government of B.C.) 
  • In 2022/23 the B.C. government is expected to receive about $2.8 billion in revenue (land sales and royalties) from oil and natural gas activity. (Source: B.C. provincial budget documents. Table A5 from the first quarterly report published Sept 2022)

B.C.’s LNG Opportunity

Natural gas demand is expected to grow due to population growth and rising standards of living. Many countries, especially in Europe, are seeking reliable, politically stable sources of LNG. This growing global demand for natural gas has created a unique opportunity for Canada to develop a domestic LNG industry. 

Much of Canada’s natural gas lies in Alberta and British Columbia, close to the West Coast where LNG plants and marine shipping facilities can be built with an aim to supply natural gas to overseas markets.

Among the current B.C. LNG facilities proposed, under construction or operating are:


Canada’s largest LNG project, under construction and is planned to be in operation in 2025. Phase 1 has two liquefaction trains with a capacity of seven MTPA each, or about 850 MMcf/d. As of October 2022, Phase 1 of the facility construction was 70% complete, and the associated Coastal GasLink pipeline was also 75% complete. Some 5,500 workers were employed at the site in October 2022. By the middle of 2023, all of the facility’s processing modules should be in place, and the workforce is expected to ramp up to 7,500. When completed Phase 1 will produce 14 million tonnes per annum (MTPA) of LNG for export. 


Plans to export about 2.1 million tonnes per annum (MTPA) over 40 years, or about 300 million cubic feet per day (MMcf/d). In April 2022, the company confirmed that it had issued a Notice to Proceed to its construction contractor. Major construction on the $1.6-billion project is expected to start in 2023, with an anticipated completion date around 2027. 


Since 1971, FortisBC has operated a facility that supplies LNG domestically to fuel trucks, buses and ferries. The facility was recently expanded and a small amount of this increased production is being shipped to China’s Top Speed Energy (TSE). In February 2020, Fortis filed plans with the Impact Assessment Agency of Canada and the B.C. Environmental Assessment Office to further expand the facility’s capacity. In partnership with TSE, Fortis is planning another small LNG facility at Terrace, B.C. If approved, construction could begin in 2021 with operations (limited marine fuelling) beginning as early as 2022. (source: Tilbury Pacific).


The Haisla Nation holding the majority investment stake, Cedar LNG would be the first majority Indigenous-owned LNG export facility in Canada. Located in Douglas Channel near Kitimat, this floating LNG plant will be designed to receive up to 400 million cubic feet per day of natural gas, to produce approximately 3 to 4 million tonnes of LNG per year for export. The project has been granted a natural gas export licence and has started both provincial and federal environmental impact assessments.


Canada’s standards governing exploration, production, transport and use of hydrocarbon resources are rigorous — more so than most other natural gas and LNG producing nations such as Russia and Qatar. Canada’s industry also has other advantages that make our natural gas and LNG desirable on the world market: 

  • The availability of a huge, high-quality natural gas resource in B.C. and Alberta can enable Canada to be a reliable and competitive supplier to global markets.
  • Standards in B.C. and Alberta that regulate flaring and venting are among the most stringent in the world, resulting in reduced GHG emissions from upstream production.
  • LNG facilities on Canada’s West Coast are closer to Asia than any other North American LNG source, particularly those on the U.S. Gulf Coast that must ship via the Panama Canal to access Asian markets. Shorter distances result in lower cost and emissions from marine transport.
  • LNG facilities in B.C. have lower operating cost for liquefaction because the average temperature is 7 degrees Celsius versus 27 degrees for Australia and 22 degrees for Louisiana. Lower ambient temperature means lower energy requirements and lower costs for liquefaction. 

Among the World’s Cleanest LNG

A 2018 Delphi Group study found the GHG intensity performance of 19 LNG facilities around the world ranged from about 0.15 tonnes of GHG emissions per tonne of LNG produced (estimated for the LNG Canada plant) to as high as about 0.70. 

Minimizing emissions from upstream natural gas production is vital to achieving world-class low emissions intensity across the LNG life cycle. Producers of natural gas in northeastern B.C. can realize GHG reductions by switching power needed to operate compressors and other equipment from natural gas and diesel to electricity derived from hydro and other sources.

In August 2019, the B.C. and federal governments committed to electrifying the natural gas value chain with a memorandum of understanding to power the province’s natural gas and LNG production with clean electricity. Some producers have already made significant strides to electrify their upstream operations.

Ongoing reduction of fugitive methane emissions is another pathway to reducing life-cycle emissions for LNG production and export.


B.C. also has tremendous expertise, technology and exceptional standards for responsible resource production. B.C.’s GHG Industrial Reporting and Control Act mandates LNG facilities in the province to meet a world-leading emissions benchmark of 0.16 tonnes of carbon dioxide equivalent for each tonne of LNG produced.

A bar graph showing Canada's LNG compared to other countries in the world.

LNG Canada

Natural Gas Burns Cleaner than Coal

Because natural gas burns 50 per cent cleaner than coal, Canadian LNG can be used in Asia-Pacific markets to displace coal-fired electricity generation, creating jobs and prosperity at home while significantly reducing global GHG emissions.

Lifecycle emissions within Canada will increase when projects currently proposed or under construction begin operation. However, when Canadian LNG is exported and used as an alternative to coal-fired power generation in global markets, this exported LNG will displace higher GHG emissions in overseas markets, resulting in a net reduction in global emissions.

Generating Canadian Prosperity 

A thriving LNG industry in B.C. could generate more than $500 billion in new investment, creating nearly 100,000 jobs across Canada and providing annual tax and royalty payments estimated at $2 billion. (Source: Conference Board of Canada, 2022). The LNG sector would become one of the largest revenue generators in British Columbia — and Canada. 

Benefitting Indigenous Communities

Indigenous communities in B.C. will also see a significant increase in economic benefits, skills training and environmental stewardship if proposed natural gas pipelines and LNG projects within their traditional territories proceed. For example nearly 90 per cent of the 32 First Nations in B.C. with proposed pipelines through their traditional territories have indicated their support through one or more pipeline benefits agreements (source: Government of British Columbia).

LNG Challenges

The global LNG industry is extremely competitive and global investors look for jurisdictions with competitive attributes such as location, natural gas supply, a strong pool of skilled labour and supportive taxation and other policies. While B.C. meets many of these criteria – for example, B.C. has vast resources of natural gas and geographic advantage that helps lower cost to access Asian markets – creating a large LNG industry in B.C. faces a number of challenges.

While the ongoing operation of LNG terminals generally falls under provincial regulation, most LNG project proposals require both federal and provincial environmental assessments and permits.

Innovation Leadership

B.C. has shown strong leadership on environmental, climate, and indigenous engagement, passing new laws, regulations and policies to define B.C.’s environment, social and governance (ESG) performance. Industry acknowledges and supports the continuous improvement approach and shares government’s desire to see B.C.’s resource industries as world leading suppliers of low carbon energy for the future.

Developing B.C.’s extensive natural gas resource will create good, sustainable jobs for Canadians and provide cleaner-burning, reliable energy to emerging economies such as India. In addition, LNG made from responsibly produced Canadian natural gas can help reduce global emissions by displacing coal-fired electricity generation, especially in China, India and other Asia-Pacific countries.

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