Steelhead LNG has stopped work on the Kwispaa LNG project in Sarita Bay on Vancouver Island’s west coast, throwing the project into doubt.
Huu-ay-aht First Nations Chief Councillor Robert Dennis Sr. and Hereditary Chief Derek Peters posted an open letter to its citizens on Feb. 15 saying that they had been notified by Steelhead LNG about the stoppage and are “deeply disappointed” in the announcement.
“We are saddened by the decision of Steelhead LNG. Huu-ay-aht First Nations is a self-governing, modern treaty Nation, and we will continue to pursue our vision of establishing a healthy, prosperous and self-sustaining community, based on our three sacred principles: Hisuk ma cawak (everything is one), ?uu?aluk (taking care of…) and ?iisaak (greater respect),” Dennis Sr. and Peters wrote.
Steelhead LNG manager of communications Matt Skinner said the decision to cease work on the Kwispaa project comes down to economics. “Given the current environment in B.C., investors really need a greater degree of certainty before investing in a project such as ours,” he said Monday. “We’ve paused (work) on Kwispaa for now and are evaluating.”
He said unlike larger energy companies, Steelhead does not have revenue to depend on to fund projects such as Kwispaa. “Steelhead is funded by investors.”
He said last week’s throne speech by the B.C. government had no bearing on Steelhead’s decision. “It comes down to the challenges that exist in getting funding for these kinds of activities.”
Steelhead had already completed preliminary engineering on Kwispaa and was to begin detailed design work in early 2019. The first phase of Kwispaa was estimated to be $10 billion, with the second phase costing an additional $10 billion. This would not have included a pipeline, which was a separate part of the LNG project.
Huu-ay-aht will evaluate what the decision will mean to their business plans in the coming days and said they will update their citizens with more information at the end of February.
“Huu-ay-aht remains committed to pursuing initiatives for meaningful economic reconciliation where we create opportunities to generate value in a global context and create employment and revenue opportunities locally,” Dennis Sr. and Peters wrote.
Skinner said Steelhead LNG has not completely pulled out of the deal, but there are no plans to continue forward at this time.
“At this point we’ve ceased work. That’s not to say it will never move forward but right now we’ve ceased working on (Kwispaa).”