Port Edward, BC – The District of Port Edward and Pacific NorthWest LNG announced today that a 25 year agreement-in-principle in support of infrastructure and services totaling approximately $150 million has been reached.
The landmark agreement guarantees the District of Port Edward $3.25 million per year, escalating over the life of the agreement, paid in the form of property taxes complemented by front-end contributions by Pacific NorthWest LNG for district infrastructure improvements.
“Pacific NorthWest LNG intends on being a long-term positive contributor to the District of Port Edward and this agreement-in-principle serves as the blueprint for a multi-decade co-operative relationship that will benefit all residents of Port Edward,” said Pacific NorthWest LNG President Michael Culbert. “I would like to thank Mayor Dave MacDonald, Port Edward Council and district staff for their dedication and hard work to get to this day.”
The Minister of Community Sport and Cultural Development, Hon. Coralee Oakes, was in attendance to celebrate the signing of the agreement-in-principle between Pacific NorthWest LNG and the District of Port Edward. The Province has committed to introduce legislation at the earliest opportunity in 2015 to enable this agreement under the Community Charter.
“Liquefied natural gas, and Pacific NorthWest LNG in particular, represents the chance to bring our children who have gone elsewhere in search of opportunity back home to Port Edward,” said Mayor Dave MacDonald. “The bold agreement with Pacific NorthWest LNG was reached on our terms and will ensure that Port Edward residents benefit from the LNG opportunity in the form of increased services, as well as infrastructure upgrades and ultimately, improved quality of life.”
The agreement between Pacific NorthWest LNG and the District of Port Edward is subject to the project proceeding to construction and will be effective upon the execution of a long-term lease with the Prince Rupert Port Authority.
Senior Advisor, Corporate Affairs
About Pacific NorthWest LNG
Pacific NorthWest LNG is planning to build a world-scale LNG export facility on Lelu Island in the District of Port Edward, British Columbia. The proposed facility will comprise an initial development of two LNG trains of approximately 6 million tonnes per annum (MTPA) each, and a subsequent development of a third train of approximately 6 MTPA. The proposed facility would liquefy and export natural gas produced by Progress Energy Canada in northeastern British Columbia. Pacific NorthWest LNG is committed to generating new economic and social benefits for the local community and First Nations, British Columbia and Canada in an environmentally safe and sustainable manner. Pacific NorthWest LNG is majority-owned by PETRONAS. JAPEX, Sinopec, Indian Oil Corporation and PetroleumBRUNEI are also partners in Pacific NorthWest LNG and its associated natural gas supply.
About the District of Port Edward
Port Edward is a small community located on the mainland of British Columbia, south of Prince Rupert. The District consists of approximately 18,387 hectares, bordered by the Skeena River, Inverness Passage, and mountains north of Highway 16. It is accessible by road, train, and by water. Residents of the community take advantage of employment opportunities and services available in Port Edward and in Prince Rupert, while enjoying the advantages of living in a small community. Medical and Government services are obtained in Prince Rupert. Education for children in grades Kindergarten to five is provided at the elementary school in Port Edward, while older students commute to the middle school and high school in Prince Rupert. The District encompasses two provincial parks, an ecological reserve and a major historical site at North Pacific Cannery. Outdoor recreation opportunities are abundant, and include fresh-water and salt-water sport fishing, hunting, hiking, camping, and boating.
This tax arrangement will apply once PNW LNG takes occupancy of Lelu Island, and is subject to a final investment decision (FID). Following FID, PNW LNG has agreed to pay upfront monthly sums in 2015, allowing the District to begin preliminary work in the community. 2016 will be considered the first taxation year.
- Project will pay to the District of Port Edward municipal taxes of fixed annual payments of $3,250,000 for 25 years (based on two LNG trains).
- The tax agreement takes effect 30 days from the signing of the lease for Lelu Island between PNW LNG and the Prince Rupert Port Authority.
- If PNW LNG builds additional LNG trains, the company will increase the base amount of funding in consideration of municipal taxation by an extra $600,000 for each additional train.
- The base amount of the taxation will increase annually by 2% over the lifetime of the agreement. The 2% rate increase is subject to review of both parties if the British Columbia Consumer Price Index changes to over five per cent or under one per cent for more than three consecutive years.
Water and Sewer System Upgrade
To ensure Port Edward has the capacity to support peak construction populations and to support future growth in the community, Pacific NorthWest LNG will upgrade the District’s water and sewer systems.
- Estimated cost of $35 million.
- new raw water well, pumps and screen,
- new water treatment plant building and dissolved air flotation treatment trains,
- new disinfection systems,
- new storage reservoir and reservoir site access road,
- new chlorine booster station and flow metering building,
- water main along Skeena Drive,
- sewage and interceptor system, including new pump station and gravity sewer upsize,
- improvements to the wastewater treatment plant which includes new oxidation ditch, new secondary clarifier, new aerobic digesters, and new pumping station building,
- subject to further consultation, the expansion of the existing effluent outfall, and
- water and wastewater pipelines crossing the CN Rail right-of-way.
Wampler Way Bypass
To ensure potential construction traffic is safely routed away from the community’s core residential area, Pacific NorthWest LNG will support development of a bypass route within the District.
- Estimated cost of $16 million.
- The District will provide $2 million toward construction, including underground, sewer and water capability, and paving through eight annual payments of $250,000 starting in the first taxation year.
- PNW LNG will rehabilitate the road after completion of the LNG facility.
The District will be responsible for further upgrades of Wampler Way when Pacific NorthWest LNG begins its operation phase.