British Columbia introduces new framework to attract investment in LNG projects

The Government of British Columbia (BC) in Canada has unveiled new tax incentives under a new framework for liquefied natural gas (LNG) projects to encourage investment.

Under the new framework, LNG projects will be exempted from provincial sales tax (PST) and LNG income tax.

The government announced these measures in the wake of a forthcoming final investment decision on a C$40bn ($31bn) LNG Canada project that seeks to build a natural gas pipeline from the north-eastern part of the province to a new terminal in Kitimat.

The terminal will process and ship LNG to buyers in Asia.

During its construction phase, the project is projected to create up to 10,000 jobs in northern BC, including 950 full-time positions.

BC Premier John Horgan said: “The LNG Canada proposal has the potential to earn tens of billions of dollars and create thousands of jobs for British Columbians over the life of the project.

“It’s a private-sector investment that could benefit our province for decades to come, but not at any price, we need to make sure the values British Columbians believe in come first.”

All future projects will be subjected to conditions, including ensuring a fair return for the province’s natural resources, creating jobs and training opportunities for the local population and adhere to the province’s climate commitments.

The framework will also formulate new greenhouse gas (GHG) emission standards under the clean growth incentive programme, which was announced in this year’s budget.

With 2007 levels as the reference, the government aims to reduce its GHG emissions by 40% by 2030, and by 80% by 2050.