BC LNG AlliancePrince George City Council

1

Members

BC Alliance represents 7 of BC’s leading LNG proponents 2

E)f(on Mobi I_ Kitimat LNG Chevron -- --&2 •

Joint venture companies

GCANADA Opportunity for British Colu mbia. Energy for the world

• PRINCE ~~ RUPERT Altalias Idemitsu Kosan LNG

• • • ·••:. Pacific

'•• Northwest !Lffe!Jrt; •

Woodfibre LNG

Mission

Foster the growth of a safe, environmentally and socially responsible and globally competitive LNG industry in BC

• Engage with First Nations, communities and stakeholders• Develop policies to enable industry to reach its full 

potential• Provide public with reliable information• Develop industry to highest environmental and safety standards

Tens of billions of dollars required to build BC’s LNG industry 3

LNG in BC – challenges

• Competition from other countries• Low oil and natural gas prices • Costs are becoming an even greater issue• Labour – will there be enough?• Environmental challenges

British Columbia is not competitive 4

Source: http://www.eia.gov/todayinenergy/detail.cfm?id=20992

Canadian Natural Gas Exports to US are in Decline – Require New Markets

EIA expects US to be a net natural gas exporter by 2017

BCt LNG~

U.S. net natural gas trade 2005-40 trillion cubic feet

8

4

0

-4

-8

-12

-16 2005

History Projections

2010 2015 2020 2025

net imports

~ ~ --------High Oi Pr"ce

2030

,__, ___ High o· and Gas Resource

2035 2040

Global LNG Competition is SignificantCurrent and Emerging LNG Exporting Countries

Source: CAPP

BCt LNG~

Norway•

Algeria*

Qatar *'ln Libya * * ~ 1"

Egypt fAE

* Oman

Guinea* * Nigeria Yemen

* Tanzania Angola*

* Mozambique

* Active LNG Exporters * Emerging LNG Exporters

* Russia

Malaysia* * Brunei

Indonesia* * Australia

* Currently Deliver and Expanding

• Asian LNG Importers * Canada -70mtpa (or 9.3 bcf/d)

Alaska * (USA)

West Coast * (USA)

. - --lwcw - ~--01000 ~ :,000 ,ICO) IQOO ~

* Trinidad

Peru*

US LNG export terminalsU.S. Export Terminals

Approved – UNDER CONSTRUCTION

1. Sabine, LA: 2.76 Bcfd (Cheniere/Sabine Pass LNG)

2. Hackberry, LA: 1.7 Bcfd (Sempra–Cameron LNG)

3. Freeport, TX: 1.8 Bcfd (Freeport LNG Dev/Freeport LNG Expansion/FLNG Liquefaction)

4. Cove Point, MD: 0.82 Bcfd (Dominion–Cove Point LNG)

5. Corpus Christi, TX: 2.14 Bcfd (Cheniere –Corpus Christi LNG) (CP12-507)

As of October 20, 20152

11 2233

44

55

Source: US Federal Energy Regulatory Commission

BCt LNG~

LNG in BC – opportunities

• First Nations• Large natural gas resources• Cold climate – ~25% increase in production capacity• Close proximity to Asian markets• Significant political support – federal and provincial• Asian economies will grow and need energy

8BC is the natural gateway to Asian markets, but must be competitive

9IEA states that natural gas = 75% of energy demand in 2040

BCt LNG~

50% INCREASE IN NATURAL GAS

PRODUCTION REQUIRED TO MEET 2030 GLOBAL DEMAND

6

Global natural gas consumption – Billion cubic feet per day (bcfd)

129169

92

11363

11853

61

Rest of World

North America

2030

Asia

Europe

461

2014

337

Emerging markets driving growth in gas demand – LNG is likely to meet most of this

SOURCE: GEP – Energy Insights (April 2015)

PERCENT OF 2014 - 2030

GROWTH (%)

44

17

32

~25% of new global natural gas consumption by 2030 will likely be met by LNG

10

Millions moving into middle class = increase demand for energy 11

BCt LNG~

2,200,000,000 NEW MIDDLE CLASS

CONSUMERS BY 2030

BC natural gas is part of the solution to reduce global emissions 12

BC )> r

' -)>

LNG z n m

4000 DEATHS PER DAV IN CHINA

DUE TO AIR POLLUTION

40 Cigarettes EQUIVALENT TO BREATHING AIR IN BEIJING FOR JUST ONE DAV

3,300,000 GLOBAL DEATHS DUE TO

AIR POLLUTION PER YEAR

6,600,000 ESTI MATE FOR 2050

1% PERCENTAGE OF CHINA' S

500 BIGGEST CITIES MEETING WHO AIR

OUALITV STANDARDS

75% ASIA' S SHARE OF GLOBAL A I R POLLUTION DEATHS

BC GHG emissions = 0.0002% of global GHG emissions

Global Greenhouse

Gas Emissions 11%

EUROPEAN UNION

1.7% 0 .0002%

CANADA BRITISH COLUMBIA

SOURCE: WORLD RESOURCES INSTI TU T E BUSINESS COUNC IL OF BC

Conclusion

• Industry must be globally competitive

• Work with First Nations partners

• Industry will invest billions of dollars

• Fair return to British Columbians for sale of natural gas

• Tens of thousands of new jobs• Work with governments at all levels

Tens of billions of dollars will be invested to build LNG industry 15