By Margot Grant
Who are the people working hard to get us an LNG plant on Howe Sound?
Woodfibre LNG, the proponent of the project, is a subsidiary of Singapore-based Pacific Oil & Gas Limited, part of the Singapore-based Royal Golden Eagle group.
RGE is founded and owned by Sukanto Tanoto, a business tycoon with a personal wealth estimated at $2.3 billion US; he is considered one of the richest men in Indonesia.
Several websites paint a dismal picture of Tanoto’s activities. As owner of Indonesia’s Unibank, he borrowed heavily and then managed to avoid repayment of $442 million US to customers.
In 2012, Tanoto was found guilty of tax evasion and agreed to pay over $200 million US in fines.
Animal lovers accuse Tanoto’s palm oil enterprise of causing orangutan deaths on a large scale and destruction of the habitat of the Sumatran tiger.
His critics, including Greenpeace, call Tanoto “Indonesia’s lead driver of rainforest destruction.” His companies and contractors, they say, routinely violate local laws and illegally expand palm and pulp and paper production into rainforests, national parks and community lands.
When Indonesian villages complained about Tanoto’s pollution and land grabbing, they say he sent uniformed thugs to put down the protests. The result: six people dead and more than one hundred injured.
In 1988, a rupture occurred in an aeration lagoon at Indorayon, a pulp and paper mill owned by a subsidiary of Tanoto’s RGE, sending raw chemical waste into a river from which several villages drew their water. Five years later, a boiler exploded, showering the countryside with chlorine and other chemicals. Thousands of people fled. Environmental organizations charge that there were alternatives to chlorine, but they would have made the production process more expensive.
Mr. Tanoto’s companies have a poor record of complying with government regulations. People who have opposed him say he has deep pockets and threatens endless lawsuits.
Woodfibre LNG’s president is Anthony Gelotti, nicknamed AG. He has worked in the development of LNG projects all over the world for Chevron, Shell North America, Enron and Mobil.
In his resume, he says that among other things, he has been responsible for “structuring the project companies to minimize tax and regulatory exposure”. One of his tasks was “to avoid criticism/opposition from NGO’s.” (Non-Government Organizations)
With his background in setting up LNG projects, including terminals and transport, he must be familiar with the SIGTTO LNG Terminal Siting Standards. SIGTTO is a global authority on the safe transport of LNG to which virtually all of the world’s private and public sector gas companies and shippers belong.
SIGTTO rules say that long, narrow inland waterways and busy channels must be avoided, and that LNG ports must not be located on the outside curve of a waterway.
The Woodfibre site is located on the outside curve of the Howe Sound shipping channel. Ships going to or coming out of the Port of Squamish would, on their routes, find themselves pointed directly at the Woodfibre LNG terminal. If they lost steering at that point, or could not stop, they would run directly into the terminal and/or the tanker moored there.
The vice-president of Woodfibre LNG, Byng Giraud, is an interesting figure.
In April 2013, Pacific Oil and Gas selected him as the first employee of Woodfibre in North America. Immediately prior, from 2010 until 2013, Giraud was vice-president corporate affairs for Imperial Metals, owner of the Mount Polley mine which, in 2014, caused massive destruction in Quesnel Lake, Polley Lake, Hazeltine Creek and Cariboo Creek, the entire Quesnel and Cariboo river systems right up to the Fraser River.
As vice-president, Giraud had been responsible for regulatory affairs and communication with regulators.
When he was recently asked about Tanoto’s environmental reputation, Giraud said: “When you come (to B.C.) you have to follow the rules, regulations and conditions imposed by our regulatory regime.”
Giraud is also on record as saying “There needs to be a public realization that the costs imposed on industry to remove extreme risks—reducing a risk from one in 1,000 to one in 10,000—comes with a price.”
Just before he left Imperial Metals, Giraud spoke about the need for British Columbia to provide more land for mining exploration. “When one adds parks, special management zones, urban areas and roads, and all those places - including non-staking reserves - together, actually only one half of the province is available to us,” Giraud said. “Fourteen per cent is in parks.”
At the moment, in addition to his work at Woodfibre LNG, Giraud is also chairman of Ridley Terminals Inc., a coal export terminal in Prince Rupert owned by the Canadian government.
Giraud is very well-connected. In his offical biography, he proudly mentions that he was director and vice president for Western Canada on the governing council of the Conservative Party of Canada with Stephen Harper.
Giraud has also been senior advisor to provincial MLAs and ministers and to federal MPs and senators, he claims. In all, he has managed or participated in more than twenty federal, provincial and local elections across Canada.
The Conservative government of Prime Minister Harper and Premier Christy Clark’s Liberal government share a strong belief that LNG is beneficial to the economy.Clark has said her LNG strategy will add a minimum of $1 trillion to the provincial economy, create 100,000 jobs, and eliminate its estimated $60-billion debt. B.C. would finally be debt-free.
In May 2014, on a trade mission to the Far East, she sat down with Imelda Tanoto, lead director of Woodfibre LNG, and while cameras flashed and minions applauded, the two women signed a letter of intent to further the growth of liquefied natural gas (LNG) in this province. Imelda Tanoto is the eldest daughter of Sukanto Tanoto.
Clark was more than pleased. “We are building a competitive new export industry in our province–one that will create unprecedented prosperity and jobs for decades.”
The plan is for the first LNG tankers to set out for the Far East before the next provincial election. The province has signed a letter of intent for a bigger LNG plant near Prince Rupert which should start operating in 2018, but with Woodfibre LNG on Howe Sound, Clark said, British Columbia is on track to have at least one project up and running before the election in May 2017.
Woodfibre LNG expects to make a final investment decision in 2015. If RGE gives the green light, the goal is to be in operation by March 2017, just in time for the election.
The B.C. Liberals campaigned hard in last year’s May provincial election on the promise of huge economic benefits from exporting LNG, winning a surprising re- election victory over the NDP.
“We have invested a lot of time and a lot of political capital in this (LNG),” Clark said. “We told people we were going to do this during the election. We ran on it, we got elected on it and we are going to deliver on it.”
Clark has a great team to promote her LNG agenda.
One ally appears to be Mike Harcourt, former NDP premier of B.C. and former mayor of Vancouver, who wrote in an opinion piece in the Vancouver Sun of March 20, 2014: “I believe Woodfibre LNG — a medium-scale export facility proposed for Howe Sound — is on the correct track (. . .) With a new opportunity ahead of us, the time has come again to move beyond the predictable jobs- versus-environment debate.”
In October 2013, the B.C. government created the position of “LNG–Buy BC Advocate” for former Liberal leader Gordon Wilson. He was supposed to encourage companies interested in building liquified natural gas facilities in B.C. to purchase supplies and services from B.C. businesses. His pay was $150,000 for one year.
Wilson worked hard for Clark during her 2013 election campaign.
For their part, Woodfibre LNG hired B.C. Liberal-connected Kirk and Co. Consulting to perform its public consultation.
Early in March this year, Resource Works Society executive director Stewart Muir went to a council meeting in Squamish to hand out “A Citizen's Guide to LNG: Sea-to-Sky Country Edition,” which promoted the potential economic benefits of Woodfibre LNG.
Muir is a former Vancouver Sun business editor and senior associate with the B.C. Liberal-allied Wazuku Advisory Group communications and lobbying firm. He also spreads the message that without LNG, B.C. would not have money for healthcare.
The Squamish Chief reported that Muir was until recently married to Athana Mentzelopoulos, one of Clark’s closest advisors.
The B.C. LNG Alliance, which presents itself as the common voice for the province’s leading LNG project proponents, launched a new advertising campaign with former Global TV reporter Jas Johal. Woodfibre LNG ’s president, Anthony Gelotti, is on the Board of the Alliance. Its mandate is “to foster the growth of a safe and environmentally responsible LNG industry in BC that is globally competitive.”
Mark Cameron, a former senior policy advisor to Prime Minister Harper, is a registered Woodfibre LNG federal lobbyist.
Fourteen natural gas liquefaction projects are proposed for B.C., nine of which have obtained export licenses from the National Energy Board, including Woodfibre LNG.
The B.C. Environmental Office is conducting both the provincial and federal environmental assessment of the Woodfibre LNG project. The Future of Howe Sound Society is trying to convince Ottawa to conduct its own assessment. How can the process be fair, it asks, if Premier Clark is such a strong supporter of LNG?
“The public statements by the premier and ministers responsible for the EA process appear to indicate that the decision makers may have predetermined the outcome of the process and have become advocates for the Woodfibre LNG project,” lawyer Anthony Leoni wrote.
Since signing the letter of intent, Imelda Tanoto of Woodfibre LNG has requested a so-called project development agreement with the B.C. government. The company wants to make sure that even if there is a new government, the same taxes, royalty agreements and greenhouse gas emission rules will continue to apply.
If the rules change, the company wants to be compensated.
Neither the B.C. government nor the company want to divulge any information about the agreement.When Natural Gas Development Minister Rich Coleman was asked point blank if companies would be compensated if future governments made changes, he responded with “I can’t say that right now.”He did say, however, that agreements will need to be reached with all projects that go forward.
The position of the Harper government on LNG is remarkable.
On September 26, 2006, Prime Minister Harper said in the House: “Mr. Speaker, we have defended this position for a long time. We oppose the passage of LNG tanker traffic through (Canadian waters) and we will continue to do so.”
Almost half a year later, on February 14, 2007, Michael Wilson, the Canadian ambassador in the United States, wrote: “Passage of LNG tankers through the environmentally sensitive and navigationally challenging marine and coastal areas of sovereign Canadian waters ... would present risks to the region ... and its inhabitants that the Government of Canada cannot accept.”
In May 2013, Gary Doer, current Canadian ambassador to the US, reiterated this view in a strongly worded letter to the chairman of the Federal Energy Regulatory Commission in Washington: “Canada continues to have serious concerns with the proposal to construct an LNG terminal on the Maine side of Passamaquoddy Bay. These concerns relate to the environmental, navigational and safety risks as well as the adverse economic consequences arising from the passage of LNG tankers through Head Harbour Passage, New Brunswick, which the Government of Canada opposes.
(. . .) “Given that LNG tankers would need to transit through Head Harbour Passage as well as the New Brunswick side of Passamaquoddy Bay, our position remains that this proposal cannot proceed. Canada will not cooperate in any coordination planning with the US authorities; nor will our government curtail the use of Head Harbour Passage and Passamaquoddy Bay in order to accommodate the incursion of LNG tankers.”
But things have changed. The Harper government has made a 180 -degree turn in its position on LNG. In February this year, his government granted federal tax breaks to developers of LNG terminals. In December 2013, the National Energy Board had granted Woodfibre LNG a license to export approximately 2.1 million tonnes of LNG annually.
Currently, Canada does not have any operational LNG export facilities. However, fifteen proposals for LNG export facilities are in the pipeline: fourteen in B.C and one in Nova Scotia. It is no coincidence that fourteen of the fifteen projects are in B.C.