Carney’s 'Buy Canadian' pledge faces scrutiny over LNG Canada’s Chinese steel plans

CALGARY — LNG Canada is planning to use Chinese steel in major components of its $33-billion second-phase expansion despite Ottawa’s promises that nationally significant projects would help drive Prime Minister Mark Carney’s Buy Canadian policy.The joint venture says Canada lacks the specialized fabrication facilities needed to manufacture the massive modules required for its expansion and plans to buy more components from state-owned China Offshore Oil Engineering Co. Ltd. (COOEC), which manufactured modules for the project’s first phase.LNG Canada announced Tuesday it would proceed with two additional liquefied natural gas processing units, known as trains.The project, located in Kitimat, BC — led by Shell, along with Malaysia’s Petronas, PetroChina, Mitsubishi Corp. and Korea Gas Corp. — is Canada’s first large-scale LNG export terminal and has the capacity to export just under 1.2 million metric tonnes of LNG per month.The expansion will double the facility’s annual production capacity from 14 million to 28 million tonnes, with completion expected in the early 2030s..Carney touts $33B LNG expansion as Canada ‘building big again’.At the announcement, Carney was asked by the CBC whether the expansion would use Canadian or Chinese steel. He said he would defer to the companies behind the project.“There will be full opportunities to buy Canadian steel, and we'll continue to invest in the Canadian steel industry to make sure that's the case. But it will be for them to decide,” he stated.That answer contrasts with the claims Carney made in September 2025, when LNG Canada’s proposed expansion was among the first projects referred to the federal Major Projects Office (MPO).“These major projects will be at the heart of our new, comprehensive Buy Canadian policy,” Carney said at the time.“To strengthen Canada’s independence, resilience and security, we will build with Canadian steel, lumber, aluminum, and by Canadian engineers and tradespeople. We will be our own best customer.”That sentiment was once again echoed on Thursday when Carney announced, at a Fort McMurray press conference with Premier Danielle Smith, that the Alberta government’s proposed one-million-barrel-per-day pipeline to the BC coast — now called the Pacific Link — would be designated a project in the national interest..“We will built the Canadian way to build the Pacific Link. We will prioritize Canadian material, including Canadian steel,” he said.“Canadian steel with Canadian workers trained by Canadian unions.”The decision to use Chinese steel has drawn criticism from Conservative Party leader Pierre Poilievre, who said that Carney is “choosing China over our workers.”He pointed to the recent announcement by Stelco Holdings in Ontario, which said earlier this week that it would be indefinitely idling its cold-rolled and coated operations at Hamilton Works starting around October 9, putting roughly 350 steelworkers out of work..“At the very moment Carney Liberals failed to save Stelco jobs, they allow Beijing to dump steel into one of the biggest infrastructure projects in Canada,” Poilievre said.“The fact that the steel needed is not made in Canada is another failure of the Carney Liberals to create the environment for steelmaking here at home.”Poilievre’s stance was also reflected by many online, such as conservative commentator Ryan Gerritsen, who quipped, “when you see Carney and the rest of the Liberals get angry about steel plants closing in Canada, they are acting.”.“LNG Canada (entirely owned by foreign investors) confirmed they will use Chinese steel to build the expansion Mark Carney was so giddy to announce,” another commentator said.“Not Canadian steel.., while Canadian steel factories shut down… and Canadians lose their jobs… Elbows Up though!”LNG Canada says its overseas purchasing reflects a gap in Canadian manufacturing capacity.“For the plant construction in Kitimat, the challenge is not a preference for offshore steel, but the specialized fabrication capability required for modules of this scale and complexity,” company spokesperson Paul Hagel told CBC News in an email, adding that “there are no fabrication yards in Canada that can manufacture and deliver the additional modules required for Phase 2.”Hagel said that only five fabrication yards worldwide have the necessary combination of space, capacity, quality systems and marine access, including COOEC’s yard in China..UPDATED: LNG Canada approves expansion as Poilievre says Carney should apologize for delays.However, he did say that some Canadian steel is expected to be used in related infrastructure, with the additional compression stations needed to increase deliveries through the Coastal GasLink pipeline expected to use almost 15,000 tonnes of steel from Canadian suppliers or mills.That number represents approximately 70% of the steel required for the compression work, rather than 70% of the steel for the entire LNG Canada expansion.On Tuesday, Corey Hogan, parliamentary secretary to Energy Minister Tim Hodgson, told CBC’s Power & Politics that Ottawa intended to use Canadian steel whenever possible on the LNG project but did not identify a minimum purchasing requirement or estimate how much would be used for the expansion.“It’s hard for me to make a blanket statement, but insofar as I can make a blanket statement, it’s that we do expect wherever Canadian steel can be used, Canadian steel is used,” Hogan said..Asked how Canadian producers would benefit, particularly amid job losses at Stelco, Hogan said the government was working with steelmakers to help them retool for major projects.“One of the things that the government is doing is trying to work with those steel producers so that they can retool and they can build the kinds of steels that allow these projects to proceed,” Hogan said.“[There’s] always a changing number. Some of these components come preassembled from overseas with the steel already embedded in them, and that's just not something we have the capacity to do as as a full component. But I can tell you that this is the firm commitment of the government, that we will use Canadian products wherever possible.”Hogan also did not identify a minimum Canadian purchasing threshold or explain how Ottawa plans to enforce its domestic sourcing requirements going forward.“In terms of those Buy Canada components, I think that’s something that we’ll need to expand on over the next couple of weeks and months,” he said.

Carney’s 'Buy Canadian' pledge faces scrutiny over LNG Canada’s Chinese steel plans

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