Whether it was simply poor timing, thanks to the fall in oil prices, or some posturing by some big spenders, Canada's future as an LNG exporter entered 2015 in a fog. However, just recently, Canada's Prime Minister, Stephen Harper, made it clear he is interested in dispersing some of the uncertainty by adjusting a portion of the country's tax code.

Late last year, several major international natural gas producers decided to pump the brakes on billions of dollars worth of liquified natural gas, or LNG, infrastructure to enable exportation from British Columbia. The combination of falling spot prices and costs that couldn't quite compete with projects under way in the U.S. proved too much to persuade management to proceed as scheduled.

To close out last year, Petronas, the Malaysian state-owned giant, led the way announcing that it would push back a decision on its $32 billion Pacific NorthWest LNG project. Granted, this project was never scheduled to come online soon enough to compete with several projects in the U.S. scheduled to begin operating by 2018. For Canada, though, it was the furthest along of 18 proposals in the country.

Shortly after Petronas balked on its plans, Apache Corp. (APA 0.61%) decided that its 50% stake in the Kitimat LNG project -- to be developed by Chevron -- wasn't worth its time or money. Instead, it would rather get some instant "gratification" by packaging its Kitimat ownership with its 13% stake in the Wheatstone LNG project in Australia for $2.75 billion to Woodside Petroleum. 

To be sure, Apache Corp. had other things going on that likely played a hand in encouraging the sale, but cost overruns and bureaucracy didn't help the cause. With questions rising about such big undertakings, ExxonMobil (XOM 1.12%) and Imperial Oil Ltd. (IMO 1.36%) bucked the trend last month, making it known that their $25 billion West Coast Canada LNG project would carry on. This is still a long way from completion, as several approvals aren't expected until 2017.

Getting serious in the Great White North
Now, if you know anything about Canada, it's a country that relies heavily on the production and sale of a vast array of commodities. So the risk of missing out on this level of spending by a single consortium of companies is mighty high. After all, we are talking about billions in spending over just a few years, with 10- to 30-year contracts tacked on for the sale of Canadian-sourced natural gas. 

As a result, it's not really a big surprise that the government, behind Prime Minister Stephen Harper, recently announced more favorable tax policy for LNG projects. All of this comes on the heels of U.S. congressional approval of TransCanada's (TRP -0.01%) Keystone XL pipeline (again), but ahead of President Obama's expected veto (again).

So, what exactly is up for grabs?
As you might imagine, every little bit helps when you're dealing with projects in the range of $25 billion to $32 billion. So when Prime Minister Harper suggested that a greater portion of capital costs associated with an LNG project's equipment and buildings can be written off, it caught others' attention.

Under the new proposal, a greater portion of the cost of these assets can be depreciated on a yearly basis, thus lowering overall taxable income. Already, it appears to be working, as Petronas is showing signs a renewed interest in its Pacific NorthWest project. 

Foolish bottom line
Understanding how important this industry will likely be for his country, Prime Minister Harper decided to steer the discussion in the direction he thought best for his country. Already, it appears to be working. 

All of this just goes to show that the future of a commodity-driven business can be determined by much more than just the supply-and-demand dynamic you learn about in Economics 101. Like it or not, governments can play a major role. For our northern neighbor, it appears that the overall economy could receive a big boost over the next couple of decades.