On Oct. 7, Question Period turned on a claim that Canadian steel fabricators can supply a large share of LNG Canada’s Phase 2 plant work, but were not asked before that fabrication went overseas. The follow-up got more specific: the energy minister said government representatives had spoken with steel companies who said they could not fulfill those module orders.
What was asked
An opposition MP said Phase 2 is a major private investment, but “the inputs for the facility portion are not coming from Canada.” Fabricators, the MP said, “have the capacity to supply significant portions of this project, but they were not consulted.” The ask: before fabrication went overseas, did anyone in government ask Canadian industry what it could build at home? A follow-up asked who decided Canadian industry could not do the work — LNG Canada, the government, or nobody.
What was answered
The Minister of Energy and Natural Resources first said the modules “are not made in Canada because there is no steel that can make those modules in Canada,” while about 15,000 tonnes of pipeline-related steel would be Canadian, with “6,100 jobs” and “$50 billion in royalties.”
On consultation, he said: “We actually talked to people at the steel companies, and they said they cannot service those orders. They asked us to make sure the rest of the steel was bought in Canada, and it will be bought in Canada.”
Our rating:
- Were fabricators consulted? partly answered. Talks with “steel companies” are claimed; no firms, dates or records were named.
- Who decided Canadian industry could not do the work? didn’t answer.
- Can the modules be made here? disputed, not settled.
What the project is
Around Sept. 28–29, 2026, LNG Canada’s joint venture took a final investment decision on Phase 2: two more liquefaction trains, capacity from 14 to 28 million tonnes a year, and five new Coastal GasLink compressor stations. The PMO called it a $33-billion private investment. LNG Canada puts peak construction at about 4,000 Kitimat jobs plus about 2,100 for the compressors (the 6,100 cited in the House) and more than $50 billion in government revenues over the project’s life.
On Oct. 2, CBC reported LNG Canada will again use modules from China Offshore Oil Engineering Co. (COOEC), which built Phase 1. Spokesperson Paul Hagel told CBC no Canadian yard can “manufacture and deliver” the Phase 2 modules; only five yards worldwide meet that bar. Compressor stations are targeting almost 15,000 tonnes of Canadian steel — about 70% of that work’s steel.
The Canadian Institute of Steel Construction told CBC it disputes that claim, wants specs and schedule, and said LNG Canada had not reached out to its members — and that Canadian fabricators can deliver a “substantial portion of the work, including the modules.”
Buy Canadian, and who decides
When Phase 2 was referred to the Major Projects Office in September 2025, the Prime Minister said major projects would be “at the heart of” Buy Canadian policy. At the Phase 2 announcement, asked about Chinese steel, he told CBC it was for the proponents “to decide.” Federal Buy Canadian rules cover strategic government purchasing; LNG Canada is a private consortium. A 2019 Canada Gazette order remitted duties on fabricated steel in Phase 1 modules after a similar capacity claim — disputed by steel-sector groups then, too.
What we know, and what we don’t
Established: the Oct. 7 Hansard exchange (Debates No. 147); Phase 2 FID and scope; LNG Canada’s statements on yards, marine access, and ~15,000 Canadian tonnes for compressor steel; the 2019 remission order.
Claimed: government talks with steel companies who “cannot service those orders” (no public who/when/what); “no steel that can make those modules” (LNG Canada stresses yards and logistics more than mill grade); that Canadian fabricators can deliver a “substantial portion,” including modules (CISC, before full specs).
Unknown: which companies were consulted, whether any written assessment exists, and whether a Phase 2 COOEC module contract is signed.
Spin check
Two different jobs, one slogan. “Canadian steel” in the answers mostly means pipeline and compressor steel. The open fight is over giant plant modules. Both can be true: Canadian tonnes for the line, process boxes built abroad. Mixing those under “Buy Canadian” is where the framing blurs it.
Bottom line
The House got a claim that steel companies were asked and said no. The public record still does not show who was asked, or settle whether Canadian yards could do part of the module work. Pipeline steel is documented; the plant modules remain contested.
Sources
Primary sources first. News reports are marked as secondary. A full source list with notes is kept alongside this piece.