British Columbia (BC) Premier Christy Clark trekked north to see new gas processing and pipeline facilities start work in the resource-rich region where Canada’s western-most province meets the Yukon and Northwest Territories.

“Natural gas is the opportunity of our lifetime,” Clark declared at a ribbon-cutting ceremony held to open a new operation built by Spectra Energy near the first milepost on the Alaska Highway at Dawson Creek. “This plant is an example of long-term economic activity that natural gas can create.”

The site, with initial production of 100 MMcf/d and construction under way to double its capacity early next year, is part of a C$1.5 billion (U.S. dollar at par) Spectra five-year BC growth plan for 2009-2013. “We are poised to invest an additional C$4-6 billion in British Columbia beyond 2015,” said Doug Bloom, president of Spectra Energy Transmission West.

At the same time a long day or two’s driving southeast of Dawson Creek in the Canadian energy capital of Calgary, rival TransCanada Corp. affirmed that northern BC is still a development hot spot on the glutted North American gas market.

Steep price declines only caused modest deceleration in the transplanting into BC of the horizontal drilling and hydraulic fracturing that generated the shale gas surplus in the United States, TransCanada said in a fresh forecast presented to the National Energy Board (NEB). The projections support an application for a BC addition, called the Northwest Mainline Komie North Extension, to TransCanada’s Nova pipeline grid in Alberta.

While the Spectra plant that lured out the BC premier serves a shale formation called the Montney, the Nova project taps into the larger, richer and more remote Horn River deposit between the northern top of BC and Fort Nelson.

In a 2011 forecast TransCanada-Nova saw Horn River production hitting 1 Bcf/d next year. The outlook relied on a rapid North American price recovery to annual averages of US$4.38/MMBtu this year, US$5.02/MMBtu in 2013, US$5.85/MMBtu in 2014 and US$6.76/MMBtu in 2015.

Chastened by glutted markets over the past 12 months, TransCanada-Nova has lowered its expectations of annual average prices by about 30%, down to US$3.09/MMBtu for 2012, US$3.70/MMBtu in 2013, US$4.37/MMBtu in 2014 and US$4.78/MMBtu in 2015. But in the new forecast, Horn River production takes only a year longer to top 1 Bcf/d. TransCanada-Nova still sees the benchmark coming soon, in 2014.

Five years from now, even faster growth is seen ahead for production from the northern BC shale gas mother lode than TransCanada-Nova projected under its older, rosier price outlook. As of 2018, the new forecast calls for Horn River production of 2.3 Bcf/d, up from former expectations of 2.1/ Bcf/d. Then the total keeps on growing at an accelerated rate to 3 Bcf/d in 2021 and just shy of 4 Bcf/d by 2029.

Similar expectations, differing only in detail, are widespread in the Canadian industry. The latest long-range consensus forecast compiled by the NEB foresees BC overhauling Alberta as the nation’s biggest gas-producing jurisdiction before 2020. By 2035, total BC output is expected to top 10 Bcf/d, or nearly double stagnant Alberta production in the 5-6 Bcf/d range.

Besides prolific northern shale geology, which has yet to be discovered in Alberta, the BC growth driver is expected to be overseas exports of liquefied natural gas (LNG).

Armed with NEB 20-year export licenses, two tanker export terminal projects for BC’s northern Pacific coast port at Kitimat are fanning out on international sales drives and predicting that they will land contracts within months. The effort targets anticipated growth markets including Japan, South Korea and Taiwan as well as mainland China.

TransCanada, which is partnered with Shell Canada for the biggest project yet in a growing LNG lineup, still has faith that gas prices will remain higher overseas than in North America despite competing supply sources in Australia and the Middle East.

“LNG projects on the West Coast are expected to increase the netback [wellhead price] of producers and will result in increased upstream [drilling and hydraulic fracturing] investment and a supply response,” predicted the new TransCanada-Nova forecast.

BC’s premier voiced an emerging provincial political consensus in favor of northern gas development when she waxed enthusiastic over the new Spectra plant near Dawson Creek.

Even the strongest opponents of Alberta-based Pacific Coast oil pipeline and tanker terminal projects, BC’s aboriginal communities, have emerged as LNG supporters. In Kitimat the Haisla are partners in one of the gas-export schemes and are providing leased land for another. The closest native settlement to the Horn River formation, Fort Nelson First Nation, has approached industry and BC authorities with a local benefits and employment strategy rather than dig in as opposition against northern gas development.

The NEB is forecasting that marketed natural gas production in British Columbia will grow 11.3% in 2012. While that is down from the 19.0% yearly gain in 2011, it is higher than the 8.2% year-over-year increase posted in 2010.