Labour shortage threatens $50b LNG plans

NLNG11 December 2013, Lagos – Energy companies trying to raise almost $50 billion for Canada’s first network of natural gas export terminals will face an even more basic challenge: finding the workers to build them.

Housing complexes boasting an indoor golf driving range, a two-storey gymnasium and a private movie theater are among perks companies are mulling to lure tradesmen to Canada’s remote, snow-swept West Coast and mitigate wage inflation that could blow up project budgets.

Labour shortages in the country already have pushed wages for some oil and gas workers as much as 60 percent higher than their counterparts in the United States, according to U.S. and Canadian labour data.

“The lack of skilled workers is a major component for the reason why you’re often behind schedule and over budget,” said Geoff Hill, partner and oil and gas leader at financial advisers Deloitte Canada in Calgary. A dearth of labor for oil sands and mining will be “exacerbated” by a new wave of construction to enable gas exports, he said.

Chevron Corp. (CVX) will need as many as 5,500 workers to build a pipeline across Canada’s western mountains and a plant on the country’s frosty Pacific Coast for shipping gas to Asia, according to company estimates.

– The Nation

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