00:00:03

Hi everyone. I'm your host, Richard Macedo.

00:00:06

Welcome to The Newsroom. On today's episode, I'll be joined by Scott Burrows. Scott is the President and CEO of Pemina Pipeline, one of the top energy infrastructure companies in the country. I'll be talking to him about a range of issues, including Canada's renewed push to build major energy projects, Pemina's own list of capital projects, and its Indigenous partnerships. This podcast was recorded on November 19th, 2025. Scott, welcome to the show.

00:00:38

Thanks for having me, really appreciate your time.

00:00:40

Let's talk about some big picture issues to get us started. And let's start with federal policies and how they impact the ability to get large infrastructure projects built in this country.

00:00:51

Your signature appeared on a letter issued to Prime Minister Mark Carney earlier this year titled Build Canada Now, with several recommendations to get things moving.

00:00:59

And we'll address some of those recommendations in a bit here.

00:01:03

I counted the signatures of about 100 executives on the letter, the latest iteration of the letter.

00:01:08

Now, the federal government seems to now view resource development in a more positive light, and it seems to have become a priority. Do you think the letter played any part in changing perspectives in Ottawa? I do. Believe that it did have.

00:01:23

An impact if you look at some of the policies or, or the things that we're talking about now, it appears as some of them, you know relate very much to the letter and really it's a combination of, of the industry coming together and aligning on 4. Very key priorities.

00:01:38

That, I think we all believe, is what's needed in this country toprogress resource development. Has that change in tone from thegovernment and some of the recent moves like the creation of the major projects office, the two sets of project referrals issued, has that helped improve the investment climate for natural resource projects? What are you hearing? I believe.

00:01:58

So, you know, I think we've seen a real meaningful shift in the tone of the federal government towards the energy industry and major project development. Obviously the implementation of C5 and having a major. Projects office set up.

00:02:11

Here in Calgary, you know, staffed by Don.

00:02:14

Farrell, who's very. Close to the energy industry I think is a positive sign, not just from obviously an experience. Perspective, but also.

00:02:21

Assigned to the energy industry and in terms of what it means and you know when you step back and you look at Canada.

00:02:27

As a whole. I mean, we have a pretty stagnant economy overall. Our manufacturing sector is fairly weak and there's not necessarily.

00:02:36

A lot of levers that we have to. Pull as a country, especially you know under the current environment with threats of trade war and increased tariffs and so when you look.

00:02:46

At the resource. Sector, to me, I'm obviously biased, but I think it stands out as something that is right there in front of us. We really haven't focused on it as a country. For the last decade.

00:02:57

And with what we're seeing right now from the government, you know, it's actually really exciting and, and what? I like about it is I would say the first year there was a lot.

00:03:06

Of chicken and egg. You know, the government was saying, hey, bring us projects and we'll help move them forward. And industry was saying what? We haven't been working on them for a decade because there hasn't been the, the climate. And you know, I think there was that. First year of a little.

00:03:20

Feeling each other out in terms of what was going to come first.

00:03:23

And what I see now is actually industry and government almost coming together to work on this path.

00:03:29

So I'm, I'm pretty optimistic. And, you know, I was cautiously optimistic, I'd say, when we first started to hear what the government was saying. And I've moved from cautiously optimistic to a little more just optimistic.

00:03:40

Right. And you alluded to some of the priority areas. The letter laid out five areas focus for the Carney government and those include simplifying regulation, committing to firm deadlines for project approvals,growing production, attracting investment and incenting Indigenous Co investment opportunities.

00:03:59

How is the government doing in making progress on these five areas? I think the devil will be in the. Details.

00:04:05

Obviously, Bill C5 was set. Up in the major projects office to help streamline some of these items that.

00:04:11

Qualify. In terms of simplifying regulations and shortening the timelines for approval.

00:04:17

So again, this is where we see some progress in terms of what'sbeing. Stood up, but.

00:04:22

We'll be looking very. Closely as we watch projects.

00:04:24

Move through that to see if the major projects office can actually facilitate those items happening.

00:04:30

I mean. Have to believe that.

00:04:31

That's going to happen. So we're.

00:04:32

Excited about that, but. Until a project actually starts moving through the process, we won't really know whether that'smade progress, but that's not to say that it's not a really good start from where we were. Previously SO.

00:04:43

That's one of the things that that I'm thinking about.

00:04:46

The other thing that we're keenly keeping a close eye on isthe emissions cap. And you know, I think about an emissions cap as really a production cap ultimately.

00:04:54

And you know, we're seeing, you know, as of today, perhaps next week, we'll have the so-called grand bargain with carbon capture, emissions cap reduction or removal.

00:05:04

And so I think that's going to be a really good indication of of where the government's at in terms of the emissions cap because that's certainly something that.

00:05:12

We would like to see. Addressed by the government.

00:05:15

And then in terms of a fiscal framework that attracts investment around the carbon tax, you know, I think one of the things we've been advocating for is, is certainty, you know.

00:05:25

What? What is that? Carbon tax going to be we need certainty so that we can have aninvestment climate around carbon, you know, for us.

00:05:33

As we've looked at various. Carbon investments, it's been really hard to commercialize them because you just don't knowwhat the carbon price may or may not be in the future.

00:05:41

And so having some certainty around that, I think we'll.

00:05:44

Be able to allow. Projects to make decisions to goforward or to not to go. Forward, but it will provide that. Certainty around it.

00:05:50

And then lastly on Indigenous investment opportunities, I meanI firmly believe that any of the major energy projects going forward will likely have Indigenous participation.

00:06:00

And you know we've had programs set up mainly to fund cash flowing assets and funding cash flowing assets is you know relatively straightforward where we've been big advocates.

00:06:13

And you know, one of the big learnings from Cedar, which I'm sure we'll talk about in a little bit, is how do we get funding for Greenfield opportunities, especially you think about this new investment climate.

00:06:23

There's a lot of momentum, there's a lot of opportunity fornew projects, but they're mostly Greenfield opportunities and I believe. That they'll require.

00:06:32

A form of indigenous participation and.

00:06:35

With that. Even with this new investment climate, even with faster regulations, there's still a meaningful amount of money that needs to be spent prior to a final investment decision and so.

00:06:46

Obviously as a. Corporation, you know, we have various levers we can pull to fund our Greenfield capital.

00:06:52

And so one of the things that that we'd like to see more of, you know, from government, the industry is.

00:06:58

How do we help? First Nations.

00:06:59

Have the ability to access. Greenfield funding versus just funding that's available for cash flowing assets.

00:07:05

Right. And we will for sure touch on Cedar LNG and the indigenous component.

00:07:09

Obviously that's a big part of it.

00:07:11

One thing that I wanted to touch on is certainty.

00:07:14

And you know, I think the executive group talked about, you know a six month maybe time frame to review projects.

00:07:21

I think the Carney government's talked about two years.

00:07:23

Is it possible to do it in six months? That's a very. Open-ended question because it really depends on the project. You know how big is the project?Is it a new SAGD mine? Is it an oil sands pipeline to the coast? You know, Are you crossing border? How many communities? So there's a broad scope. You know, putting a specific timeline out there. You know that broad I I don't have a good answer. For you.

00:07:46

But what I would say is is that. We need to be.

00:07:49

Faster like it? Just when you look at the amountof time it's taken. Projects to get approved.

00:07:55

And the amount of. Capital that you have to.

00:07:57

Put at risk the amount of investor uncertainty it creates,it's just it's not feasible going forward.

00:08:04

So you know for my business, when we think about long linear assets, six months would probably be.

00:08:10

A little aggressive. If I'm being honest.

00:08:12

Two years is too. Long so if we could get it down to, you know, 9 to 12 months, I think that would be very reasonable. But there there's a lot behind that question. I mean, at the end.

00:08:21

Of the day, everybody. On that list that signed a letter, I think can say we all want to do the right thing.

00:08:26

We want to do the right things by the communities.

00:08:28

We want to do the right things by the Indigenous communities, we want to do the right things by the environment.

00:08:33

And so I don't think any of us are trying to shorten that, but we just need process to move through it with certainty and with with pace. And given all the infrastructureprojects that we see coming forward, do you have any concerns with the labor shortages or shortages of key materials if industrial construction heats up? You know, an example and and many of our listeners will know the inflation that we saw skyrocket with all the oil sandsprojects in the 2000s when companies were trying to build projects simultaneously. So do we face similar risks withthis happening? And, you know, obviously that's key for an infrastructure company or a company that buildsmajor infrastructure like Pembiden.

00:09:10

How do you manage that? Yeah.

00:09:12

I mean, I think it depends how many of these projects go forward and at what time frame. If they all happen at the same time. I mean, it's a bit of a pro and a con because been wanting this for decades and it means great things for industry, but there's no doubt.

00:09:25

We have a a relatively. Small labor pool.

00:09:27

Compared to the US especially. In some of these remote locations, but that's also where we need to get creative.

00:09:32

Like one of the huge advantages of Cedar is.

00:09:35

Is that it's the vessel itself? Is being constructed in South.

00:09:39

Korea. So that's a big piece of Labor that's. Being constructed overseas versus say in the remote areas of of Kitimat.

00:09:46

So there's a lot. Behind that, in terms of of whenthey're being built and and what's being built, there's often different. Labor crews for large.

00:09:54

Diameter inch pipe than small diameter inch.

00:09:56

Pipe. So it's a.

00:09:57

Long way of saying I do think there's a risk if they all happen at once. But we should see.

00:10:01

These kind of. Paced out a little bit.

00:10:03

Over time, the other thing I'd say we're we're spending more time is with this demand draw of certain assets in the US for data center development. What does that mean for the oil and gas industry and and specifically generators and turbines? You've seen the backlog for turbines for gas power in the USI mean the backlog is is significant the time to. Receive those products is has.

00:10:29

Increased significantly. Over the last couple years.

00:10:31

And some of those products we use in existing operations for some of our gas pipelines and other things.

00:10:36

So we're keeping a pretty close eye on some of the the demands that the AI boom is creating in the US and what that means from a supply chain perspective here in Western Canada.

00:10:45

Let's turn to oil and gas production in Western Canada andthe related infrastructure that affects Pemina's business directly. Canadian midstream operators areexpecting a big jump in natural gas and liquids production for the remainder of the decade and are jockeying for position to process, transport and market as much of this new supply as possible. How is Pemina planning on capitalizing on this production growth? Yeah. We share a very similar view when we look at the resource that's in particularly NortheastBC and into Alberta and the Monty formation.

00:11:17

I mean it is some of the lowest cost inventory in the world and I think people recognize that. It's always been a question of.

00:11:24

Of how do we get? It out of the ground most efficiently and where does it go? To because we've obviously suffered.

00:11:29

Significant price dislocation compared to the US.

00:11:32

You know, there was a recent report that came out from the BCgovernment that had the BC reserves, I think the natural gas. Reserves were up 8.

00:11:39

Percent and the liquids were up 20% and so.

00:11:42

That just goes to speak to to the resource.

00:11:44

Potential in in Northeast BC and to me the way I think.

00:11:48

About it is it's really. An ecosystem because you don't drill necessarily just for condensate, you don't drill justfor propane, you don't necessarily drill for natural gas. I mean, you can and in dry formations, but they all kind of have.

00:12:01

To work a little bit. In relation to each other.

00:12:04

And so I start with the oil sands and, and what makes me excited is, you know, you're seeing the likes of CNQ and their latest investor. Day talk about their growth.

00:12:12

Potential, there's the bottlenecks that embers just announced and so if you use 600,000 barrels.

00:12:18

A day just as a. Rough number of of incremental.

00:12:21

Oil Egress. Through some of the optimizations we're seeing the oil sands players talk about being able to fill. That that's.

00:12:28

About, you know, 150 to 200,000 barrels a day at condensate.

00:12:31

That condensate in our view has to come from the WCSB because the import pipelines are full. And So what that means is more drilling for condensate and natural.

00:12:40

Gas. But of course if.

00:12:41

You're drilling for condensate, natural gas comes along with it.

00:12:43

Where's natural gas going to go? And and that's where it ties to LNG and and obviously with the. Close to three BCFA day.

00:12:51

That's in service or coming into service with Cedar.

00:12:53

And wood fiber. And then another potential to getting us up to. 5 BCFA day. Of LNG Canada phase two now you're going to have a home for the gas and you're going to havea home for the condensate, the oil be able to move on the export pipelines and then of course there's the associated NgLS that come with that gas production as well and there's.

00:13:12

Export off the West Coast, that's.

00:13:14

Our terminal alta gases, terminal incremental expansions there as well. So it all really has to work.

00:13:19

In concert and what's unique I think about Pamina is that we play in every single one of those commodities.

00:13:25

We have a natural gas business. We have a natural gas liquids business. We have a crude oil.

00:13:29

Business. And so when I think about where we can play, it starts in the field.

00:13:34

And so, you know, right now we have how many gas infrastructure? Which is the largest? Third party gas processing entity in in Western Canada.

00:13:43

And so you know it starts with filling up the white space you have in those assets and then expansions thereafter.

00:13:49

In addition to our existing pipelines, you know we have two different pipelines that are being permitted in in BC and andin Alberta right now to really forward-looking to.

00:14:00

What we see as the. Future growth of the basin, our 4th fraction, it'll be coming online in 2020. 6 which we started. Back in 2023, and that was really. To get ahead of the.

00:14:10

Wave of Ng LS that we saw coming associated with LNG Canada phaseone in the growth that that comes along with that and then of. Course we have.

00:14:18

Our ability to move propane out of red water either to our own terminal. We also recently signed, you know we're a customer of Alta Gas.

00:14:25

We signed a 30,000 barrel a day contract with Alta Gas.

00:14:27

We can move it out of there. We have a very, very large.

00:14:30

Ethane presence in Western Canada as well and then LNG, so you know depending on which molecule.

00:14:36

Gets produced. There's various aspects of our value. Chain where where we think we can participate in that volume growth.

00:14:41

Let's talk about West Coast propane exports specifically.

00:14:44

So you mentioned, you know during the second quarter Peman announced a long term tolling agreement with Alta Gas for that30,000 barrels a day of LPG export capacity at Alta Gas's Ridley Island terminal and and the future Ridley Island energy export facility. Your company also approved the $145,000,000 optimization project at its Prince Rupert propane terminal, increasing the storage capacity and allowing access for medium gas carrier vessels.

00:15:11

Can you talk about how those moves will help grow Pemina's propane exports business? Yeah, great.

00:15:17

Question, you know when it comes to propane through our red watercomplex, which is a fractionation complex in Alberta, we have 3 fractionators.

00:15:25

Our 4th is coming online. We would have the.

00:15:28

Largest supply of propane in the basin and and really ultimately trying to find homes for that for the best market.

00:15:34

Historically, that's. Been, you know, into the US we've gone as far as Mexico. We send a lot of propane to Eastern Canada as well. But over the last.

00:15:42

Decade as we've opened up the markets.

00:15:44

The East. That's really.

00:15:45

Become where the best net back has been recently and so we've been pretty focused on getting our.

00:15:50

Barrels off of the West Coast. You know, we sit here today.

00:15:53

We have a a. 20,000 barrel a day propane export terminal.

00:15:56

We use relatively small ships because it's in an inner harbor and they're just not as cost efficient as as the medium gas carriers and so. That.

00:16:05

Project is not necessarily going to increase the throughput for for Pamina will remain around that 20,000 barrels a day, but what it. Allows us to do is really reducethe per barrel cost. Reduce shipping time.

00:16:17

Which allows us to access. Different markets in Asia, different ports in Asia and IT. Allows our producers to.

00:16:23

Get a better net back. Because it's a lower.

00:16:25

Cost option than it was before. So that's our terminal and then today before we signed the contract, we were one of the.

00:16:32

Larger shippers through the Alta gas.

00:16:34

Terminal and took the opportunity.

00:16:36

With a really good. Partner to increase.

00:16:38

That as RFS 4. Was coming online, we knew we needed incremental home for propane barrels and took the opportunity to expand that relationship with Alta Gas goingforward. Pebina has a binding deal to supply 50,000 barrels a day of ethane to the currently delayed Dow Chemicals Canada expansion at Fort Saskatchewan.

00:16:57

How is this delay impacting Pebina? So if I just talk. About the ethane market in general, you know one of the things we think about longer term. Is.

00:17:08

Western Canada remains one of the.

00:17:09

Cheapest sources of. Ethane in the world and so a couple years ago when Dow announced their expansion, we wewere. Obviously really excited about that. And very happy to sign our long term supply agreement with Dow. But if you just even step back from that project, there's an enormous amount of ethane that gets extracted and quite frankly gets left in the gas stream today. And so, you know, longer term, it would be awesome if we could attract, you know, another ethane entrant or future expansions for the ethane parties that are here. Today, just because there is.

00:17:41

So much ethane in the province today.

00:17:44

And as it relates. To the Dow supply arrangement, you know we're continuing to. Work with Dow.

00:17:49

All indications you know from our perspective, I can't speak on behalf of Dow, you know appears that this is a delay, not a a cancellation and really trying to time the the market ofin service of. Of a cyclical asset.

00:18:01

That they're in and so we're working with them right now in terms of of what that means for us.

00:18:07

It's given us more time to. Look at our cost.

00:18:10

Look at how we. Supply that ethane and so we're just working closely with DAO and as a good partner would you know, trying to find win win solutions on on a go forward.

00:18:19

Basis. Let's stick into the ethane market a little bit more. Where are the best markets to ship ethane? Is it inside Alberta or is therea business case to ship it to the West Coast? Yeah. So as of today, the.

00:18:33

Ethane that gets extracted in Western Canada gets consumed by DAO and Nova. Those really are the two sourcesof of. Ethane demand in the province and nothing really Well, there is no.

00:18:44

Export off of the West. Coast there is some ethane that's entrained in alliance and gets extracted down in in the Midwest, but from a pure ethane. Perspective.

00:18:53

It's really. Just the the petrochemical business in Alberta today in terms of a future business, you know, we we think about. Is there a way to? Get incremental investment in the province.

00:19:04

That's something that that's top of mind for us longer term when we think about exports. It's still cost prohibitive as we sit here today there's. Anywhere from, I'm going to callit 100 to 200, maybe even 300,000 barrels a day of of ethene. Unfortunately, that's kind of spread. Across the.

00:19:21

Province and it's just not all at one source.

00:19:24

Where you could build a. Pipeline to the West Coast, we know you need somewhere between, you know, 500 to 600,000 barrelsa day to make an economic case for a pipeline and so we don't see in our position today a pure ethane pipeline being built.

00:19:40

To the coast. And right now the rail of ethaneis. It exists, but it's really.

00:19:47

Expensive. And so do I think there's a market in Asia for Canadian ethane? Yes. Is it economically viable to make it happen? We don't see it today, but that's not to say that it's not possible in the future.

00:20:00

I'd like to focus on LNG next because it's such an important industry to provide an outlet for natural gas production in Western Canada and also with the milestone of the startup of LNG Canada during the summer. Now Peman is involved in a separate project, Cedar LNG, which we mentioned earlier as a 49.9% partner with the Heisler Nation.

00:20:20

Can you provide an update on project construction? Yeah, I'd be happy to. So we FIDD that.

00:20:26

Project in the summer of 2024 so you know a little.

00:20:31

Over a. Year and a half ago and we've been, you know, extremely pleased.

00:20:35

With how progress has progressed.

00:20:36

So as my earlier comment, the ship and the top.

00:20:40

Side. So this is a.

00:20:41

Floating vessel A. Hull of a vessel.

00:20:43

And then the LNG modules are essentially bolted on on top of it like a giant Lego set. I know I'm simplifying it, but if you can visualize that. That.

00:20:52

Work is all being done in South Korea in a controlled shipyard and that is going extremely well.

00:20:58

It's it's extremely efficient. We're excited with where we're at. It's tracking on time, maybe even slightly ahead of time. We're looking.

00:21:06

Forward to the keel. Laying in January of this year and so. That ship that's really.

00:21:13

Under a contract with Samsung Black and Beach and is progressing. I would say as expected.

00:21:18

What Pamina is accountable for in terms of of the onshore facilities, really we think about it in terms of there's about a 10 kilometer pipeline that ties into coastal gas link that to our facility. We have a transmission line to power the facility and then the onshore facilities that the shipultimately. Hooks up.

00:21:37

For this summer was really. A big year for the.

00:21:41

Pipeline it's, it's only a 10 kilometer pipeline, but it's oneof the most technically challenging pipelines that that Peman has ever had to build. And I'm, I'm pleased to say we were expecting to get, call it 20% of it done this year and andwe're close to 85% done. It just went extremely, extremely well, and that was probably one of the riskier.

00:22:00

Parts of the overall project. Not not from an overall.

00:22:03

Capital at risk? But from a percent of capital atrisk. Just because it was.

00:22:07

Technically challenging so we. Were very pleased.

00:22:09

With how that went in terms of the transmission lines, we're right now in the middle of clearing the right of way, whichagain it is progressing. And if you went up to site today, you can see. The site where all the electrical power will will be hooked.

00:22:23

Up and so that site's been cleared it's been leveled we started the retaining walls and so you know from an overall.

00:22:29

Project perspective I would say we're.

00:22:32

On time and on budget. Maybe you know a.

00:22:34

Week or two ahead of schedule, but of course.

00:22:36

It's a it's a very long term project so I don't want to get too excited. But it's always better to be a little. Ahead than a little behind, but I'm very. Pleased with with how the.

00:22:44

Construction's gone to date. And the Cedar Partnership recently filed for regulatory approval to increase the liquefaction capacity by 100 million cubic feet per day to 500 million a day. What was the rationale for this move? So the original amendment was for 400 million a day. Through the design of the ship, we were able for some relatively modest capital to increase the capacity to 440 million cubic feet a day.

00:23:13

And because we knew we had to, you know, there's always from the time you file you kind of work through your engineering, there's always some minor amendments that you need to make. So we were filing some of the amendments to the ship and so our.

00:23:24

View is is that. There's potential for that to ship, to do more. I mean, we won't know that untilyou know it's up and running and we can.

00:23:33

Obviously safely test. Everything but there is an opportunity to at. Least get to 440.

00:23:38

And so why not ask for a little bit more and and you know, hopefully when it's up and running and we do some safety bottlenecks that will be able. To get to the five. 100 So you know that's not something that we're banking on, that's not in our economics, but because we were taking the opportunity to.

00:23:52

File what I would call. A regular course EA amendment.

00:23:56

We decided to take that. Opportunity to ask for a little bit. Capacity, because we do.

00:23:59

Believe in the fullness of time that that that might be available. And will we see a, a Cedar LNG phase two and if so, when do you think a decision will be made onthis and and what factors are you weighing before moving forward? You know that there's a few different. Parts to that.

00:24:14

Question, you know as a global statement whenever we build an asset. We always look to say.

00:24:21

Where can we have modest? Capital that would allow.

00:24:24

Us for the second phase you know just like LNG Canada phase two should be more economic than LNG Canada phase one because you prebuild a lot of things and so. Just by the way we operate, we.

00:24:34

Tend to think about that in advance.

00:24:35

So based on that kind of approach to major projects.

00:24:38

What what we did do was the. Pipeline that goes from coastal gasoline to seater is actually capable of doing 800 million a day. The transmission line will be.

00:24:48

Able to do technically support a seat or. 2 And so kind of some of the core infrastructure that we're building today, we're sizing that for a seat or two. Now in terms of what has to happen, I mean we have a partner Cedar one and and what may or may not be a seat or two would be on their traditional.

00:25:03

Territory so their approval their.

00:25:07

Communities and their nation's acceptance.

00:25:10

Of that is very critical to what a.

00:25:11

Seat or two may look like and so.

00:25:14

It really starts with the Heisler's appetite.

00:25:17

Then there's the infrastructure piece that we control, and then the third. Piece is the gas supply.

00:25:22

And we don't control. The gas supply today, that's.

00:25:24

An LNG Canada agreement with Coastal Gas Link the Heisler hadthe amazing foresight many years ago to get the 400 million a day. Cubic feet.

00:25:34

Per day on that pipeline, which has allowed.

00:25:36

Us to do cedar. But we don't, Cedar does not ownan equity interest in that pipeline.

00:25:40

So we don't have PRO. Rata.

00:25:42

Rights to that pipeline. So we would need the Heisler to be on board. With a cedar 2.

00:25:48

We would need. Obviously, the gas supply.

00:25:51

And then commercial arrangements, so.

00:25:53

It's a possibility, but right? Now we're really focused on justcontinue to execute on Cedar one.

00:25:57

Right. And perhaps #2 would be a major projects office project filing. That would.

00:26:04

Be that would be wonderful. Yeah.

00:26:06

Are there any other opportunities for Peveno with regard to LNG beyond Cedar LNG? You know, nothing that we're publicly talking about today in terms of if I think of 10 years,absolutely. I mean I.

00:26:20

I do believe that we have a real.

00:26:23

Opportunity in Canada to continue to build on what we've started as an LNG industry. I mean, just look what's happened in the US and how fast they moved and how much that's grown. And I still think that opportunity exists in Canada. I think, you know, going back tothe earlier comments, the major projects office, the momentum with the government, I think there's a lot of will behind LNGand so. We would.

00:26:45

Love to continue to play a role in that and you know, we're the only company in Western Canada building floating LNG.

00:26:51

And so that that's. Become a bit of a core competency as well. And so how do we leverage? Floating LNG into more than just a cedar one.

00:27:00

We'd we'd love to. Do that we.

00:27:01

Think out to 2035. So I think it's extremely critical to the nation to continue to focus on on LNG development. And I want to stay with Cedar LNG and maybe pull on a different thread.

00:27:12

And I've got a question about Indigenous involvement in the project. And we've talked about that a little bit, but we had former Heisler Chief Counselor Crystal Smith on our podcast earlier this year and she called Cedar LNG quote, the definition of economic reconciliation.

00:27:28

Can you talk about how this partnership came together between Pembina and the Heisler, and what Pembina can take from this relationship as a blueprint on how it manages its relationships with other Indigenous nations? Yeah, well, it all started with their foresight to.

00:27:44

Take the 400 million. Cubic feet a day of.

00:27:47

Capacity on coastal gasoline because.

00:27:49

Without that. Foresight.

00:27:50

We wouldn't have what? What Cedar is today.

00:27:53

So first of all, just a huge kudos.

00:27:55

To the nation for having that much foresight, you know, as they were looking to develop the project, they were looking for an industry proponent to to help, you know round out what they bring to the table and what we bring to the table and, and through. That process they selected us.

00:28:10

As an industry partner and a lot of it was around shared values and that was one of the key decision making as I understand it from their perspective. And it's been a remarkable partnership in terms of really leveraging each other's strengths. You know, the amount of that we've learned from them about caring for the environment, fantastic government relations. We've really learned a lot from the Heisler from that perspective.

00:28:38

And then we obviously bring an industry perspective, you know, executing on major projects, commercializing the asset and really putting. Those two skill sets together.

00:28:47

And leveraging the best of both parties, I think has been extremely rewarding for both parties.

00:28:52

And, and it is a true partnership.

00:28:54

I mean, we have equal governance rights.

00:28:56

You know, it's a 50 point 149.9%.

00:28:59

So it's a. True partnership.

00:29:02

From both an equity. Perspective, but.

00:29:03

Also from a governance. Perspective We have boards of directors equal say. Technical oversight committees.

00:29:09

And so I'm not aware of another Indigenous partnership that's.

00:29:14

Been put together like that. In our industry, let alone in inCanada and I know that there's been a fair number of investments in Canada, but again it goes back to that minority interest almost a cash flow stream versus like truly having a say in how this. Project gets developed.

00:29:30

And having a seat. At at the table.

00:29:32

I think has has been a great outcome and I would echo the comments, I think it's a model. For future.

00:29:36

Development in Canada and it's also why we've been pushing.

00:29:39

For how do we get? The government or whoever.

00:29:44

To set up the right. Funding mechanisms for Greenfield opportunities because I.

00:29:48

Think. There's many, many opportunitieslike the one that we have at Cedar that that's out there and and not just probably in the energy industry in all industries. As well.

00:29:56

Right. And from the government, is it just a straight loan or there other mechanisms that they can look at? I think.

00:30:01

Our project was a bit. Unique, we didn't have any of the funding in place and so when we got.

00:30:08

To the FID. Decision, I mean it was one of the hardest we were continuing having to spend to progress engineering and kind of move it along.

00:30:16

And so you know, I've talked about this many times, but at the time of FID, we were close to $600 million at risk and we were really helping fund that project on 100% basis despite only owning 50% because we believed in the project we believed in in what it did for the country.

00:30:34

And you know, I ultimately glad we FIDD once we FID.

00:30:38

D We were able to put. Project finance in place now again. Pamina took a 50% contract at the time of. FID because we.

00:30:46

Needed to have it almost 100% contracted in order to have it project financed. So there's certain things that.

00:30:52

That we brought to the table that the Heisler brought to the table that. Ultimately led to, you know, really strong relationship, but once we FIDD then we were able to put in project finance. The Heisler were able to work with various agencies. To get the funding, but up untilthat FID was made there was no mechanism and so Pamela was doing a lot of the the funding and so I raised that only.

00:31:13

Because I think that could. Be potentially an inhibitor to future development and so you know continuing to.

00:31:20

Push for How do we? Find or push the government to find Greenfield funding, recognizing that it's going to be a risk. I mean this is what? Industry faces. All the time we we have to put acertain amount of money at risk. Before we have ID.

00:31:33

And so continuing to to try to find ways to have programs so that the First Nations can. Participate will be helpful.

00:31:40

Right. And de risking I guess would be the most important thing at the front.

00:31:43

End yeah and de risking usually comes down to.

00:31:46

How fast is the regulatory process? Because the longer the regulatory.

00:31:50

Process takes the. Longer you know you're spending,the longer you're uncertain, and so they all kind of have to worktogether. And you mentioned this earlier on a little bit, but it's Indigenous ownership of infrastructure projects going to be more of a regular feature in Canada. And in other words, is it going to be a must have? That's the way I see it.

00:32:08

Especially as we move into to BC in the in the coastal areas and I do think. It is a real if.

00:32:14

You structure them properly. Like we do with cedar.

00:32:17

Going back. To to Chief Crystal.

00:32:19

'S comments. It really is the ultimate form of economic reconciliation. Being true partners, having people at the table, having you know, aligned views and working together I think will be critical.

00:32:31

Scott, I think that's a good place to end the conversation.

00:32:33

Thanks for joining me today. Thanks for having me.

00:32:39

Today's podcast was produced by Stephen Marsters.

00:32:42

Please send your feedback to audio@dobenergy.com.

00:32:47

Remember to follow this podcast to ensure that you never miss anepisode. Also, be sure to provide feedback or press the like button on our Spotify or Apple accounts if you're enjoying our show.

00:32:58

I'm Richard Macedo. Thanks for listening.