Natural Resources Minister Tim Hodgson is bullish on long-term demand for Canadian LNG, as some analysts warn of a looming supply glut driven by new export projects in the U.S. and Qatar.

In a House committee, Bloc Québécois MP Mario Simard asked Hodgson about his views on projected global demand for liquefied natural gas, suggesting future European and Asian appetite for the fuel is uncertain in a rapidly changing power landscape. 

“If I understand your question, it’s that pundits don’t think there’s going to be demand for LNG, so why should we build them?” said Hodgson.

“I love pundits, who have no skin in the game, who produce lovely reports that have zero economic impact on anything.”

“As a business person, I like to talk to customers, and if a customer tells me they’re willing to pay for something and they’re willing to provide a long-term contract for it, I look at that as a more valuable signal than pundits,” he added. 

Hodgson recently travelled to India, the country expected to have the largest growth in the demand for natural gas through 2030. 

No enduring contracts were signed, but a joint statement was released stating Ministers “affirm to deepen bilateral energy trade, including the supply of Canadian LNG” and other oil and gas products.

The joint statement released with China earlier in January contained similar language, that is “an agreement to collaborate on energy, clean technology, and climate competitiveness,” with no specific long-term LNG commitments.

In committee, Hodgson says LNG is being viewed globally as a bridge between coal and renewables.

“What we hear over and over again is that with the dramatic increase in electricity around the AI phenomenon, our allies expect to be using that transition fuel.”

Defending the industry’s economics, he said LNG projects are among the most significant drivers of provincial revenue and taxes.

Canada’s LNG landscape

Canada exported its first LNG cargo to Asia last year through the LNG Canada facility in Kitimat. 

Phase 2 of that project would double capacity, and was among the first to be referred to the Major Projects Office (MPO) last fall. 

Ksi Lisims LNG was also among those singled out for a referral to the special government agency. 

The companies behind both projects have yet to make a final investment decision, a critical final step for capital-intensive projects. 

They had aimed for earlier timelines, but now say a decision could be made within the year depending on market conditions. This would mean beginning operations between 2027 and 2030.

In total, there are seven LNG export projects in various stages of development in Canada, including relatively smaller projects Woodfibre LNG, Tilbury LNG, and Cedar LNG.