Terrace banking on China-focused industrial park

Northern city hoping to attract manufacturing, LNG sectors to Skeena Industrial site

Terrace’s 2,400-acre Skeena Industrial Development Park is partly owned by Taisheng International Investment Services, an offshoot of China’s Qinghuangdao Economic Development Zone | Photo: City of Terrace

For some B.C. cities like Terrace, which is looking at Chinese companies as a key part of its economic rejuvenation, the fight between Beijing and Ottawa over Huawei Technologies Co. Ltd. has amplified area economic uncertainty.

But Terrace officials say they also understand the dispute – which has escalated to include the banning of canola imports into China from Canada’s two largest producers – is out of their control. Instead they’re focused on attracting businesses to the city’s Skeena Industrial Development Park, a 2,400-acre site partly owned and developed by Burnaby’s Taisheng International Investment Services.

Taisheng, an offshoot of China’s Qinghuangdao Economic Development Zone and its business interests, said it has no plans to alter its goal of bringing Chinese manufacturers interested in Terrace’s easy port access to Asia and North American location, even in light of the trade dispute.

“China’s economy and Canada’s economy complement each other,” said Taisheng managing director Richard Zhang, whose company invested $11.8 million in Skeena Industrial Development Park in 2014. “Those fundamentals have not changed, and trade is still happening.”

Zhang added that when his company promotes the park in China, Chinese companies have questions about the situation stemming from Huawei. But he said that, over the long term, “Canada is still considered a very appealing option.”

The stakes are high for Terrace, where the availability of natural resources like lumber and minerals has been offset by mine closures and capacity reductions, said Terrace’s economic development manager, Danielle Myles.

She added that a manufacturing sector taking advantage of Terrace’s proximity to the Port of Prince Rupert could add revenue to the tax base of a city that urgently needs diversification.

Zhang said Taisheng has completed its on-site water system plans and must now get federal and provincial government approvals. In the meantime, Taisheng is stepping up marketing efforts for Terrace in China, and there are some firms in areas like seafood processing, metal fabrication and energy that have expressed interest. But many of them would need a running water system to work – something that may still take a year or longer to put in place.

That’s why both Taisheng and Terrace are turning to another opportunity – Kitimat’s LNG Canada megaproject – to fill the short-term business gap. Zhang said that some of the logistical needs of construction companies on the LNG Canada project, such as equipment storage, may not need a water system and so can theoretically be moved to Skeena Industrial Park as soon as the end of this year.

And, given LNG Canada’s close ties to Asia, Zhang said catering to the project’s needs fits into Taisheng’s original concept that the industrial park be a part of North America’s industrial gateway to Asia and vice versa.

Four of LNG Canada’s five stakeholders – PetroChina Co. Ltd., Korea Gas Corp., Malaysia’s Petronas and Japan’s Mitsubishi Corp. – are from Asian economies.

“LNG is something that’s deeply linked to the Asian market, whether it’s China, Japan or South Korea,” Zhang said. “The project brings a lot of momentum to the region, and we feel that during that time, the contractors will need support in nearby areas to service their equipment, operations and logistical needs. We are only 30 kilometres away; it’s a 30-minute drive, and our land availability is not as limited as it is in Kitimat.”

In addition, Myles said, smaller producers are looking at producing LNG in the industrial park using an existing high-pressure natural gas line. The city is also aggressively pursuing investment opportunities from abroad as part of B.C.’s entrepreneur immigration pilot program, which would allow foreign investors who bring manufacturing or related industrial businesses to Terrace to fast-track their immigration.

The city is partnering with Taisheng and Global Dewatering Ltd. and the Kitselas First Nation, the two other owners of land within the Skeena Industrial Park site, to find a consultant who will tailor an investment attraction strategy for the next stage of promoting Terrace and its new industrial park.

Zhang said the search for tenants will not be limited to China.

“This is a platform that is open to everyone. It is a Canadian project that will bring opportunities and growth to the B.C. northwest, and anyone who wants to prosper together in this opportunity is welcome.”