Premier John Horgan has pledged to address some of the impediments to the natural resource sector and industry, including ‘more boots on the ground’ for permitting and lobbying the new Biden White House to end lumber duties once and for all.
His government also announced an $84 million fund Thursday to help industries and public bodies connect to the BC Hydro grid in an effort to reduce their reliance on fossil fuels, like natural gas, and lower electricity tariffs for industry.
Horgan was keynote speaker Thursday at the third and final day of the BC Natural Resources Forum. Resource industries in B.C. have helped buoy the B.C. economy throughout the pandemic, and say they can play an important role in post-pandemic economic recovery.
Horgan said the fundamentals are strong in B.C. for a robust rebound, once the worst of the pandemic is over: low debt to GDP, a strong credit rating, high commodity prices, low unemployment, an abundance of natural resources and clean electricity.
“I believe the time is indeed right for British Columbia to take its place as a leader in Canada as we come out of COVID-19 stronger than we went in,” he said. “And the resource sector will lead the way in that regard. And I am very grateful for all the work that you’ve done, over the past year, over the past three years.”
There are many resource project proposals, like new mine projects, in the queue in B.C. But as attendees heard Wednesday, there are shortages in government permitting offices.
Horgan also said the pandemic, which has forced so much day-to-day business to go virtual, has revealed some significant gaps in connectivity and access to broadband Internet in many parts of B.C. where natural resource development occurs.
Those two things have put a drag not only on permitting, but also on key negotiations with First Nations, notably the Wet’suwet’en First Nation.
In an attempt to defuse things between hereditary chiefs and the Coastal GasLink pipeline project, the Horgan and Trudeau governments reached an agreement with the Wet’suwet’en to recognize their inherent rights and title.
But they committed to an ambitious timeline to get negotiations done, and the pandemic essentially pushed pause on those talks in 2020. The situation was aggravated by a lack of what Horgan called “connectivity” – i.e. basic broadband Internet service and technology.
“One example that has been frustrating for me is the inability ...to make progress with the Wet’suwet’en because of isolation,” Horgan said. “Social distancing does not allow large groups of people to come together.
“Those (talks) have been frustrated by COVID-19 and a lack of connectivity has meant … those discussions have been slowed in pace. I hope that we can pick that up as we come through with more vaccinations in the weeks and months ahead.”
Horgan pledged to “retool our permitting processes,” put more government boots on the ground, and increase investments in connectivity.
“Connectivity has demonstrated to be insufficient in many parts of British Columbia,” he said. “So we’ve doubled down on our investments in connectivity in rural or remote parts of British Columbia, and you’ll see more of that in the budget coming later this year.
“It also means that we make sure that we have more boots on the ground to assist with permitting and to assist First Nations in better understanding the consequences of the decisions they’re being asked to make, oftentimes without the capacity to fully understand the consequences of what’s being proposed.”
He also addressed the inertia in getting development projects, like new mines, through enviroinmental reviews and permitting.
“My sense is we need to retool our permitting process,” Horgan said.
All natural resource development in B.C. needs to be guided by two core principles, Horgan said: sticking within B.C.’s carbon budget, as per the CleanBC Act, and reconciliation with First Nations.
Horgan acknowledged the disadvantage industries in B.C. face with climate policies and environmental regulations that are more stringent and have been in place longer than most other jurisdictions in North America.
“When you see other jurisdictions letting ‘er rip, it frustrates people back here at home – I get that,” Horgan said.
He is hopeful a Joe Biden White House will begin to harmonize some of those kinds of policies and regulations and put B.C. industries on a more level playing field.
But he also expressed some concern with Biden’s “Buy American” policy proposals, and expressed doubt that Canadian natural gas producers will ever regain the U.S. market share they once had
“All the more reason for us to get to other markets across the oceans,” Horgan said, referring to B.C.'s nascent LNG industry.
“An abundance of natural gas…and also an abundance of clean, green electricity, puts B.C. at a competitive advantage over our partners in Canada and North America. We need to take full advantage of that.”
He added that B.C. needs to be well-positioned for commodities downturns. Right now, key commodities for B.C. are high – in the case of lumber, they have hit record highs.
“LNG Canada is leading the way by ensuring that we have $23 billion in tax revenues and royalties and rents from that activity that we can drive back into communities, back into skills training, to make sure that we are preparing for the next challenges that the economy will throw our way.
“We know that the up is always followed by a down, followed by another up. We need to make sure that the down’s not too steep and the high doesn’t make us dizzy.”
In an attempt to build on B.C.’s clean power advantage, the Horgan government is pushing incentives to get industries to switch from fossil fuels to electricity.
On Thursday his government announced that it is earmarking $84 million of federal funding for electrification that Horgan said “will be at the disposal of new companies coming to British Columbia to hook up to the grid, and existing companies who are converting from fossil fuels to electricity.”
He added there will be “reduced industrial tariffs for the use of electricity.” The standard power rates for industry are being lowered by 20%. That pledge got an immediate thumbs-up from the Mining Association of BC (AMBC).
“The new electrification tariffs are smart public policy tools,” said MABC CEO Michael Goehring. “They will help our sector to innovate, electrify and decarbonize even further and consolidate our position as a world leader.”
As for forestry, high lumber prices gave the industry a temporary reprieve in 2020 from the decline it has be in – a decline driven by a dwindling supply of timber and high operating costs.
The Horgan government has given the forestry sector a break on stumpage fees during the pandemic. But it’s an industry that faces longer term structural and geopolitical problems, including the never-ending softwood lumber war.
Horgan expressed hope that a Biden White House will be more receptive to resolving the dispute once and for all, and out an end to duties and tariffs on Canadian softwood lumber exports.
“The province is going to be working with Washington, D.C. and our allies there to make sure that we can put this to bed for the last time,” he said.
