EYRE: More headlines than pipelines — how Canadian LNG must make up for lost time

Bronwyn Eyre is a senior fellow at the MEI, a think tank with offices in Montreal, Ottawa, and Calgary.Back in 2022, then-German Chancellor Olaf Scholz came to Canada seeking to buy Canadian liquefied natural gas (LNG). Japanese Prime Minister Fumio Kishida soon followed suit. Both, however, would leave empty-handed after former prime minister Justin Trudeau offered them green hydrogen instead.Now, Canadian LNG is back on the international table. The country’s first export terminal in Kitimat, BC, is officially exporting to Asia, and its next-phase expansion plan is being fast-tracked as a federal major project.In addition, Canada and Germany signed a supply agreement in May tied to the also-fast-tracked Ksi Lisims LNG project in northwestern BC. According to letters of intent, Germany will import up to one million tonnes of LNG per year by the early 2030s.But there’s a twist. Because Canada has no LNG export infrastructure on the east coast, the prized commodity will have to be shipped via the Panama Canal.Such logistical madness underscores how fundamentally infrastructure-deficient Canada has become. Federal Energy Minister Tim Hodgson recently dodged the issue by suggesting that exporters could avoid the Panama Canal by doing financial swap contracts to fulfill international shipping commitments.That’s one approach. But it fails to address the effect of Canada’s deep structural dysfunction. Rather than address the regulatory environment that has made investment in Canadian pipelines dry up over the past decade, both Ottawa and some provincial governments have elected to bring taxpayers’ funds into their preferred projects..The government’s policy seems to be: “If something moves, tax it. If it’s still moving, regulate it. And if it stops moving, subsidize it!” After all, laws such as C-69 and C-48, which make it near impossible to get large projects approved and ban tanker traffic coming from northern BC ports, are directly responsible for some firms’ decisions to stop funding new pipeline projects in Canada, at least for now.There are other issues as well. Two federal court lawsuits filed against the Nisga’a-backed Ksi Lisims by other indigenous groups were withdrawn in June 2026 after benefit agreements were signed, though legal challenges to the associated pipeline continue. The project currently lacks consent from a number of those impacted, including Gitxsan and Gitanyow hereditary chiefs. They are also firmly opposed to the associated 750-kilometre natural gas pipeline.Increasingly, our ‘Can’t-a-da’ reputation is preceding us. India recently complained that Canadian fuel supplies must become “unhindered” from regulatory hurdles and insufficient infrastructure. Corporate Canada agrees. CIBC President Harry Culham recently said that the lack of Canadian energy infrastructure over the last decade has produced “more headlines than pipelines.” National Bank of Canada’s Laurent Ferreira said Quebec must act quickly to tap its own considerable gas resources if it doesn’t want to continue to import more than half its supply from the US.It’s hard to unwind the past. Former Quebec Premier François Legault banned oil and gas development and revoked drilling licences. Investment turned away, including Warren Buffett’s investment firm, Berkshire Hathaway, which once planned to invest four billion dollars in the LNG export terminal in Saguenay..Reading the new international room, new Quebec Premier Christine Fréchette has cautiously mooted revoking Legault’s hydrocarbon ban, while Nova Scotia is lifting its moratorium on fracking and inviting gas producers to again submit drilling applications. Clearly, this is good news for future transatlantic exports to Europe.However, despite the apparent momentum, not everything is rosy for energy development. In response to environmentalists’ demands, the BC energy regulator recently announced that it would be ramping up roaming air monitors of LNG Canada, despite six methane measuring stations already in place. Industry leaders say the federal target of cutting methane emissions 75% below 2012 levels by 2030 is unreachable and amounts to a production cut by default.On LNG, global perspective is everything. As a Fraser Institute report recently pointed out, Canadian natural gas exports could significantly reduce India and China’s continued reliance on coal. Let’s also not forget that in the United States, the shift from coal to natural gas in power generation has driven a substantial decline in greenhouse gas emissions over the past two decades. A decade ago, more than 20 planned LNG export projects were percolating in Canada. And now? Let’s just say that headlines over pipelines no longer cut it.Bronwyn Eyre is a senior fellow at the MEI, a think tank with offices in Montreal, Ottawa, and Calgary.

EYRE: More headlines than pipelines — how Canadian LNG must make up for lost time

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