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Canadian Energy Centre

To reduce emissions, the world needs more LNG: report

Published

1 year ago

4 minute read

The LNG Canada export terminal is about 85 per cent complete. Photo courtesy LNG Canada

From the Canadian Energy Centre

By Deborah Jaremko

Wood Mackenzie says spending needs to rise by $400 billion over the next decade

An additional $400 billion investment in liquefied natural gas (LNG) projects around the world is needed over the next decade to ensure energy security and achieve emissions reductions, according to a new report by Wood Mackenzie.  

Without increased LNG supply, it said Asian countries in particular will continue to rely on high-emitting coal as they grow power generation. 

“On a global scale, limited supplies of LNG risks stalling progress towards 2050 net zero targets in the near term,” says the report by Wood Mackenzie and Petronas, one of the joint venture owners of the LNG Canada project.  

The fallout from Russia’s invasion of Ukraine rerouted LNG shipments from Asia to Europe, contributing to record coal consumption in 2022, analysts noted.  

“A key pillar of the energy transition is to reduce the consumption of coal. A critical step in that transition is to shift power production from coal to much lower-emissions gas. The shift helps drive immediate decarbonization while renewables, energy storage, and other clean energy technologies scale-up.” 

Power generation from natural gas reduces emissions by half on average, according to the International Energy Agency (IEA). LNG from Canada can deliver an even bigger decrease, reducing emissions by up to 62 per cent, according to a 2020 study published in the Journal for Cleaner Production. 

Global natural gas use is rising, driving increased demand for LNG. The U.S. Energy Information Administration’s latest outlook projects natural gas consumption will rise to 197 quadrillion BTU in 2050, up from 153 quadrillion BTU in 2022.  

“Gas can be used to not only replace coal for power generation, but also to provide fuel for blue hydrogen production, and as an essential source of flexibility as electricity grids incorporate increasingly large amounts of intermittent renewable generation,” Wood Mackenzie said.  

“Gas also plays a critical role in non-power sectors such as commercial and residential heating, as a feedstock for chemicals and fertilizers, and as an energy source for metals, cement, and other manufacturing processes.” 

Canadian LNG has advantages in a lower emission world, the report said.  

“Canada’s western ports are ideally positioned to supply growing Asian demand because its shipping routes aren’t dependent on an uncongested Panama Canal. The country is also poised to produce some of the lowest-emission LNG in the world,” Wood Mackenzie said.  

The low emissions per tonne of LNG in Canada come from shorter shipping distances to customers, a colder climate, the use of hydroelectricity, and methane emissions reduction from upstream natural gas production. 

Once it starts operating in 2025, LNG Canada will have emissions intensity of 0.15 per cent CO2 per tonne, less than half the global average of 0.35 per cent per tonne, according to Oxford Energy Institute.   

Proposed Indigenous-led project Cedar LNG would have emissions intensity of 0.08 per cent, and smaller-scale Woodfibre LNG would have emissions intensity of 0.04 per cent.   

“The gas and LNG supply and demand mismatch that spawned the current energy crisis and stalled energy transition progress can’t be repeated,” Wood Mackenzie said.  

“This will require a long-term commitment to expanding capacity to ensure reliable, increasingly low-emission, and affordable LNG that won’t be upended by future geopolitical and economic disruptions.” 

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Canadian Energy Centre

Saskatchewan Indigenous leaders urging need for access to natural gas

Published on April 3, 2025

By

Piapot First Nation near Regina, Saskatchewan. Photo courtesy Piapot First Nation/Facebook

From the Canadian Energy Centre

By Cody Ciona and Deborah Jaremko

“Come to my nation and see how my people are living, and the struggles that they have day to day out here because of the high cost of energy, of electric heat and propane.”

Indigenous communities across Canada need access to natural gas to reduce energy poverty, says a new report by Energy for a Secure Future (ESF).

It’s a serious issue that needs to be addressed, say Indigenous community and business leaders in Saskatchewan.

“We’re here today to implore upon the federal government that we need the installation of natural gas and access to natural gas so that we can have safe and reliable service,” said Guy Lonechild, CEO of the Regina-based First Nations Power Authority, on a March 11 ESF webinar.

Last year, 20 Saskatchewan communities moved a resolution at the Assembly of First Nations’ annual general assembly calling on the federal government to “immediately enhance” First Nations financial supports for “more desirable energy security measures such as natural gas for home heating.”

“We’ve been calling it heat poverty because that’s what it really is…our families are finding that they have to either choose between buying groceries or heating their home,” Chief Christine Longjohn of Sturgeon Lake First Nation said in the ESF report.

“We should be able to live comfortably within our homes. We want to be just like every other homeowner that has that choice to be able to use natural gas.”

At least 333 First Nations communities across Canada are not connected to natural gas utilities, according to the Canada Energy Regulator (CER).

ESF says that while there are many federal programs that help cover the upfront costs of accessing electricity, primarily from renewable sources, there are no comparable ones to support natural gas access.

“Most Canadian and Indigenous communities support actions to address climate change. However, the policy priority of reducing fossil fuel use has had unintended consequences,” the ESF report said.

“Recent funding support has been directed not at improving reliability or affordability of the energy, but rather at sustainability.”

Natural gas costs less than half — or even a quarter — of electricity prices in Alberta, British Columbia, Ontario, Manitoba and Saskatchewan, according to CER data.

“Natural gas is something NRCan [Natural Resources Canada] will not fund. It’s not considered a renewable for them,” said Chief Mark Fox of the Piapot First Nation, located about 50 kilometres northeast of Regina.

“Come to my nation and see how my people are living, and the struggles that they have day to day out here because of the high cost of energy, of electric heat and propane.”

According to ESF, some Indigenous communities compare the challenge of natural gas access to the multiyear effort to raise awareness and, ultimately funding, to address poor water quality and access on reserve.

“Natural gas is the new water,” Lonechild said.

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Alberta

The beauty of economic corridors: Inside Alberta’s work to link products with new markets

Published on April 1, 2025

By

From the Canadian Energy Centre

Q&A with Devin Dreeshen, Minister of Transport and Economic Corridors

Devin Dreeshen, Alberta’s Minister of Transportation
and Economic Corridors.

CEC: How have recent developments impacted Alberta’s ability to expand trade routes and access new markets for energy and natural resources?

Dreeshen: With the U.S. trade dispute going on right now, it’s great to see that other provinces and the federal government are taking an interest in our east, west and northern trade routes, something that we in Alberta have been advocating for a long time.

We signed agreements with Saskatchewan and Manitoba to have an economic corridor to stretch across the prairies, as well as a recent agreement with the Northwest Territories to go north. With the leadership of Premier Danielle Smith, she’s been working on a BC, prairie and three northern territories economic corridor agreement with pretty much the entire western and northern block of Canada.

There has been a tremendous amount of work trying to get Alberta products to market and to make sure we can build big projects in Canada again.

CEC: Which infrastructure projects, whether pipeline, rail or port expansions, do you see as the most viable for improving Alberta’s global market access?

Dreeshen: We look at everything. Obviously, pipelines are the safest way to transport oil and gas, but also rail is part of the mix of getting over four million barrels per day to markets around the world.

The beauty of economic corridors is that it’s a swath of land that can have any type of utility in it, whether it be a roadway, railway, pipeline or a utility line. When you have all the environmental permits that are approved in a timely manner, and you have that designated swath of land, it politically de-risks any type of project.

CEC: A key focus of your ministry has been expanding trade corridors, including an agreement with Saskatchewan and Manitoba to explore access to Hudson’s Bay. Is there any interest from industry in developing this corridor further?

Dreeshen: There’s been lots of talk [about] Hudson Bay, a trade corridor with rail and port access. We’ve seen some improvements to go to Churchill, but also an interest in the Nelson River.

We’re starting to see more confidence in the private sector and industry wanting to build these projects. It’s great that governments can get together and work on a common goal to build things here in Canada.

CEC: What is your vision for Alberta’s future as a leader in global trade, and how do economic corridors fit into that strategy?

Dreeshen: Premier Smith has talked about C-69 being repealed by the federal government [and] the reversal of the West Coast tanker ban, which targets Alberta energy going west out of the Pacific.

There’s a lot of work that needs to be done on the federal side. Alberta has been doing a lot of the heavy lifting when it comes to economic corridors.

We’ve asked the federal government if they could develop an economic corridor agency. We want to make sure that the federal government can come to the table, work with provinces [and] work with First Nations across this country to make sure that we can see these projects being built again here in Canada.

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