By Steve Scherer
OTTAWAAug 19 – Delivering clean hydrogen to Germany and the rest of Europe is a better opportunity for Canada than trying to build liquefied natural gas terminals (LNG), as the world moves away from fossil fuels, the country’s natural resources minister said Thursday.
Canada and Germany discuss terminal construction LNG on Canada’s Atlantic coast over the next five years, for German Chancellor Olaf Scholz’s visit to Canada next week.
Germany has been trying to gain independence from Russian gas since its invasion of Ukraine in February, but the cost of transporting the gas from Alberta in western Canada to the east coast is said to be high.
A new pipeline would be needed, and the global shift from fossil fuels means its lifespans would be too short to be profitable unless converted into a hydrogen terminal when gas demand declines.
“We are working on those issues. But what I would say is that… on the East Coast, hydrogen is the big opportunity,” Natural Resources Secretary Jonathan Wilkinson told Reuters.
Wilkinson’s comments reflect a shift in support for possible new concept LNG on the east coast. A German official said on Thursday that the LNG Canada would only be “a medium term solution”.
Scholz will sign an agreement to establish hydrogen supply chains with Canada during a two-day visit next week.
The agreement will accelerate a partnership to develop hydrogen exports from the East Coast as early as 2025, Wilkinson said.
Hydrogen is a fuel with no CO2 emissions, suitable for large industrial machines, heavy vehicles and for heating.
In recent months, Canada and Germany have indicated that they are discussing options for terminals LNG on the east coast, and Canada’s environment minister, Steven Guilbeault, told Reuters in June that Repsol’s New Brunswick site was the most viable project.
The essential minerals used in electric vehicle batteries will also be on the agenda of the German visit, due to the companies’ “active interest” in securing supply through associations or investments, Wilkinson said.
Volkswagen Chief Executive Herbert Diess will be one of the travelers, people familiar with the matter told Reuters. Wilkinson said that Mercedes-Benz Group AG, and BMW they will also send representatives.