Steelhead LNG project gets early OK from Huu-ay-aht Nation

It's one of many hurdles on the road to getting a major liquefied natural gas facility up and running approval from the First Nation upon whose land the export facility will be built.

That's what Steelhead LNG got on Saturday, when the 750-personHuu-ay-ahtNation on Vancouver Island's west coast voted 70 per cent in favour of the Vancouver-basedenergy company's proposed SaritaLNG project.

"We are thrilled to be, at this point, working with the Huu-ay-aht First Nationthat we believe are setting precedence, not only in Canada for Aboriginal relations with industrybut also globally," said NigelKuzemko, CEO of Steelhead LNG.

Kuzemko and his Huu-ay-aht counterpartsbelieve the co-management agreementannounced Monday in Vancouveris the first of its kind, and that the First Nation's approval came earlier in the project development than in any other proposed LNG pipeline orexport facility.

"We really need to emphasize the fact that Huu-ay-aht is participating in this project at the co-management level. We're going to have a say in how this project proceeds, and that's a first in B.C," said Robert Dennis, chief councillor with the Huu-ay-aht Nation.

Co-management deal

The project will have a six-person oversightboard thatwill have three seats saved forHuu-ay-ahtrepresentatives. The First Nation will also get a seat on Steelhead's corporate board.

"[I'm] elated, fantastic it feels really good. An incredible opportunity is on our doorstep and we want to pursue that opportunity," said Dennis. "We're seizing it on the goal that we are going to make things better for the Huu-ay-aht people."

According to the chief councillor, theHuu-ay-ahtcommunity isn't facing as severe an unemployment problem as some First Nations, but he said there's a wide gap between the prosperity in his community and that in the rest of Canada.

"We are going to pursue at least 15 per cent of the jobs [from the project] and we'll take it from there," he said.

Kuzemko declined to provide many specifics on the proposed export facility, saying it was far too early in the development to know the estimated cost of the projector how many jobs may be created.

"We've been awarded, by the [National Energy Board], export licences for 24 million tonnes[per year] from the Sarita Bay location," said Kuzemko, who hopes to target the north Asian LNG market when thefacility could begin exporting in 2024.

But first, Steehead has to figure out how to get natural gas from the source in northeastern B.C. and northwestern Alberta across B.C., across the Salish Sea, and over VancouverIsland to the SaritaBay site near Bamfield.

There are also more regulatory hurdles to clearand, of course, uncertainty about what global LNG demand could look like in seven years.

The company's final investment decision will come in 2019 or 2020, according to Kuzemko.

Opposition to the project

Crystal Clappis, who left the position ofHuu-ay-ahtexecutive director last September, was among the people who voted against the project on Saturday.

"Before we had to vote, we were not told or we have no for-sure information whether [the proposed facility] isgoing to be land-based or floating.We don't know the size. We don't know anything about it," said Clappis, who was devastated to learn the outcome of the vote.

"I was crushed. Like, I literally just cried. I couldn't believe that our people 70 per cent of them would vote in favour of something that they don't have all the details about," she said, adding that complete environmental assessments haven't been done.

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