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Natural gas liquids 'the one thing we have to hold hope to' after LNG delays

Natural gas liquids including propane and butane are a lone bright spot in an otherwise bleak local economy, Dawson Creek Mayor Dale Bumstead said during a regional district vote on a controversial Encana Corp. facility Thursday.
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Dale Bumstead holds up a pair of maps showing a kilometre radius around a proposed fracking sand facility in the centre of Dawson Creek. The mayor said the region needs to take advantage of investment, including in natural gas liquids, during an uncertain time for the oil and gas industry.

Natural gas liquids including propane and butane are a lone bright spot in an otherwise bleak local economy, Dawson Creek Mayor Dale Bumstead said during a regional district vote on a controversial Encana Corp. facility Thursday.

The oil and gas company hopes to build a new "hub" to collect and process condensate and natural gas liquids on a rural parcel in the Tomslake area. The proposal has met with protest from residents in the area, who say the facility will intrude on their rural lifestyle.

But Bumstead said the area couldn't afford to pass up investment during a brutal time for B.C.'s oil patch.

"For me, this isn't about Encana or ARC (Resources) or Murphy (Oil) or Progress (Energy) or Tourmaline (Oil), it's about the economies of our communities and our region, and we are a resource region," he said.  

"What we're talking about today are the economic opportunities that are brought by the liquids that are contained within (the Montney shale formation)," he said. "Those economic opportunities, I think, are the one thing that we have to hold hope to."

Bumstead's comments come one week after a major liquefied natural gas (LNG) player indefinitely delayed its proposal to export gas from the B.C. coast.

LNG Canada announced Monday that it would not make a final investment decision on its Kitimat facility by the end of the year as planned. The plant would have sourced natural gas from the South Peace, allowing producers to sell their product on the world market.

However, natural gas prices have collapsed along with the price of oil, leaving the 20 proposed B.C. facilities in jeopardy.

"That has huge impacts on the natural gas industry," Bumstead said, noting that the unemployment rate in the region has surged in the past 18 months.

But natural gas liquids, including light oil, condensate, butane and propane, remain relatively steady.

In recent months, investors have put hundreds of millions of dollars into gas processing plants in Northeast B.C., including Veresen Midstream in the South Peace. AltaGas, meanwhile, hopes to build a propane export facility near Prince Rupert.  

While rural residents say they bear the brunt of that development, Bumstead noted Dawson Creek residents have to deal with oil and gas infrastructure, too.

"We have a 50,000 square foot frack sand facility that's going to be built by CN in the centre of our town," he said. "There's 2,100 residences within a kilometre of that. So for me, we do face the consequences of that."

reporter@dcdn.ca
 

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