Steelhead ceases work on LNG project in Sarita Bay

Eric Plummer, February 19, 2019

The Kwispaa LNG project is designed to export liquified natural gas from Huu-ay-aht land in Sarita Bay to overseas markets hungry for the resource, but the development now faces uncertainty. (Steelhead LNG photo)

Anacla, BC — 

Steelhead LNG has halted the development of a multi-billion-dollar facility in Sarita Bay, casting uncertainty on a project that was expected to bring up to 400 long-term jobs to Huu-ay-aht land.

The news was circulated to members of the Vancouver Island First Nation on Friday in an open letter from Chief Councillor Robert Dennis Sr. and Tayii Ha’wilth Tliishin (Derek Peters).

“Huu-ay-aht First Nations was notified by Steelhead LNG that it ceased current project work on the Kwispaa LNG project,” stated Dennis and Peters. “We are deeply disappointed, and over the coming weeks your government will evaluate the implications of this decision by Steelhead LNG, identify all go-forward options, and assess how best to advance the interests of our citizens.”

First announced in 2014, the Huu-ay-aht have been pursuing a partnership with the Vancouver-based energy company that would build an export terminal in Sarita Bay on land owned by the First Nation. Through an estimated capital investment of $10 billion, plus another $8 billion to build natural gas pipelines from northeastern B.C. and across the Strait of Georgia, Kwispaa LNG is designed to use the deep waters of Barkley Sound to meet a growing international demand for the resource.

Kwispaa has secured National Energy Board licences to export up to 24 million tonnes of the condensed gas annually, and in October Steelhead announced the “major milestone” of filing a comprehensive project description to the B.C. Environmental Assessment Office and the Canadian Environmental Assessment Agency. A final investment decision is scheduled for 2020, with export operations starting in 2024.

Although “saddened” by Steelhead’s decision to cease current work on the project, the Huu-ay-aht will continue to seek economic opportunity for its more than 700 members. In a 2017 referendum, 70 per cent of Huu-ay-aht citizens voted to pursue the LNG project. Later that year the First Nation made a $3-million purchase of property in Sarita Bay from Western Forest Products with plans to use the land for Kwispaa.

“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,” stated Dennis and Peters. “As a nation, we continue to be open for business as we work to improve the lives of our citizens by seeking out economic opportunities.”