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Hefty tariffs apply to LNG modules, Canada Border Services Agency rules



The roller coaster ride toward getting an operational liquefied natural gas facility built on the shores of Howe Sound continues for Woodfibre LNG.

On the same day the Squamish Nation announced its council had voted to approve impact benefit agreements necessary for the project — a significant milestone for Woodfibre — the Canada border agency delivered a blow to the financial side of the company's ledger.

At issue for Woodfibre is a 45.8 per cent anti-dumping tariff on fabricated industrial steel components needed to build the facility.

Those components make up 40 per cent of the weight of the modules that will be connected to build the facility, the company says.

On Friday, the Canada Border Services Agency announced its ruling that those steep tariffs for fabricated steel should apply to LNG facilities.

In May of 2017, the Canadian International Trade Tribunal ruled that the "dumping" — or export at a price that is lower in the foreign market than in the domestic market — of some goods from China, Korea, and Spain have had a negative impact on Canada’s economy.

Thus, anti-dumping fees were imposed on fabricated industrial steel components from those countries.

Woodfibre — and others — argued that these tariffs were unfair.

Arguments against the tariffs include that the components are manufactured into modules before being shipped so are manufactured goods, and thus should not be subject to the tariff.

Woodfibre and other LNG advocates have also previously argued that there aren’t any comparable Canadian manufacturers capable of providing the modules needed for LNG facilities.

The ruling can be appealed within 90 days of it is release.

"We’re reviewing the ruling and evaluating our options," said Jennifer Siddon, Woodfibre's associate vice-president of corporate communications in an email to The Chief.

~With files from Steven Chua


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