In June of this year, Pembina and partner the Haisla Nation announced a positive final investment decision (FID) for Cedar LNG, a floating facility that will export approximately three million tonnes of liquified natural gas each year, beginning in 2028. As we move forward together, the world’s first Indigenous majority-owned LNG project with one of the cleanest environmental profiles is now a reality.
Chief councilor Crystal Smith of the Haisla Nation has spoken about the significance of Cedar LNG to her community and their economic self-determination. Additionally, the project will increase access for Canadian lower carbon commodities to reach global markets and demonstrates a true commitment to Indigenous reconciliation by honouring the complementary strengths the Haisla Nation and Pembina each bring to the partnership. Cedar LNG will continue to celebrate the project we are developing, but it is equally important to recognize that our journey to this point brought challenges that required a creative and flexible approach.
Most opportunities for Indigenous ownership of energy projects in Canada have focused on existing operating assets – projects with steady revenue streams that support simple financing arrangements. Greenfield projects, like Cedar LNG, require years of pre-FID work to obtain regulatory approvals, commence engineering, procurement and construction work, and negotiate customer agreements, among other things. This work requires significant capital investment and risk acceptance. In order to progress Cedar LNG, Pembina made material at-risk financial commitments on behalf of the partnership prior to knowing if the project was viable, and without project or Haisla Nation financing in place. As a partnership, we worked through tough decisions together within a shared governance structure.
Cedar LNG clearly matters to the Haisla Nation and Pembina. But Cedar should also matter to all Canadians, as a symbol of who we want to be, what we stand for and why we should be proud of Canadian energy.
In recent years, we’ve spent a lot of time talking about Canadian energy and how best to develop it, protect the environment and contribute to global energy security. Projects like Cedar demonstrate how this can happen when industry, government and Indigenous communities work together to meaningfully advance Indigenous reconciliation and the economy.
Cedar LNG will provide global markets with a lower-carbon energy alternative that meets Canada’s high environmental and operational standards. In doing this, Cedar will create up to 500 jobs during peak construction, and approximately 100 full-time jobs during operation, with a preference in hiring local and Indigenous workers and companies. Further, it will enable stable and sustained upstream development and build overall investor confidence in Canada, while generating an estimated $257 million in GDP contributions over the four-year construction phase, and annual GDP contributions of an estimated at $85 million over the 40-year operational life of the project. These long-term benefits are more than numbers – they represent improvements to our overall quality of life, including schooling, health-care and other critical community supports.
Canadians have been searching to find a united sense of pride in our resource development – Cedar LNG is one of those reasons. With more projects and partnerships like Cedar, we can continue Indigenous, and Canadian, nation-building that creates sustained economic self-sufficiency for all communities.
Our collective understanding of meaningful Indigenous ownership must include greenfield projects where communities have a strong voice in planning, design and governance. This requires implementation of government financing and loan programs flexible enough to enable Indigenous communities to participate in, and fund, early development opportunities.
Thomas Edison once said that “opportunity is missed by most people because it is dressed in overalls and looks like work.” Yes, continued work is required to seize the opportunity for Canadian energy, and yes, more work is required to seize the opportunity in the right way. It is not, and will not, be easy, but it is critical that we do this work, including putting the right programs in place to enable diverse Indigenous partnership opportunities, so that we can move forward, together.
Scott Burrows is the president and CEO of Pembina Pipeline.
Watch for our ongoing series of informative commentary from Canadian business leaders on the first Tuesday of every month in the Calgary Herald and Financial Post.