Two news articles are enclosed. Further below in this posting is a listing of key articles examining natural gas fracking and liquefaction plans in British Columbia.
A big bet in the race to B.C.’s coast
By Brent Jang and Nathan Vanderklippe, The Globe and Mail, Sept 11, 2012
Spectra Energy Corp. and BG Group PLC are proposing a new pipeline megaproject to carry natural gas to the British Columbia coast for export to Asian markets, making it the largest bet yet that the province’s energy riches will find a home abroad in a high-stakes race worth tens of billions of dollars. The two companies envisage brisk demand for B.C. natural gas from customers in Japan, China and South Korea, and big potential in India and Thailand, said Doug Bloom, president of Spectra’s Western Canadian operations.
In the process, they are attempting to build a future that stands to see Canada’s westernmost province rival Alberta as Canada’s natural gas heavyweight. “It’s British Columbia that has a massive resource base, and that’s where the bulk of the supply will come from,” Mr. Bloom said in an interview Monday in Spectra’s Vancouver office. “There are enormous amounts of domestic supply and production capability that are way in excess of domestic needs.”
Houston-based Spectra and BG of Reading, England, will be 50-50 owners in the pipeline estimated to cost up to $8-billion, with Spectra building the line and BG filling it with natural gas.
The pipeline plans serve as an insight into the size of the terminal BG is looking to construct. Based on research by CIBC World Markets Inc. earlier this year examining the cost of liquefied natural gas (LNG) terminals in Australia, such a project in Canada could cost $24-billion to $32 billion for the terminal alone, although costs between the two countries aren’t directly comparable.
The pipeline, which would take years to permit and build, would connect the gas fields in northeast British Columbia with Prince Rupert, where BG has gained access to port land it believes to be suitable for an export terminal for LNG. The 850-kilometre line would be built with a capacity of 4.2 billion cubic feet per day. When it is full, the new Spectra-BG pipe will carry more natural gas than Ontario and Quebec burn today on a daily basis. The tremendous size being contemplated is the latest indication of how much gas companies believe they can extract in British Columbia and how substantial plans are for the province to become a globally significant player in gas markets.
Earlier this year, TransCanada announced plans for another pipeline, Coastal GasLink, that would initially carry up to 1.7 billion cubic feet a day of gas to Kitimat, B.C., another coastal town not far from Prince Rupert, where a series of companies have proposed new LNG terminals. That’s on top of a third pipeline, the Pacific Trails pipeline, which could carry more than one billion cubic feet a day to Kitimat.
Combined, the three pipelines promise to carry 6.9 billion cubic feet of B.C. gas for export, at a time when output in Alberta, long Canada’s primary source of gas, is fading. According to figures released by the Alberta Energy Resources Conservation Board in June, Alberta’s natural gas output is expected to fall to seven billion cubic feet a day in 2021. Seen that way, the new pipelines, – which could enter service as early as 2019 – portend a future where British Columbia vies for the title of Canada’s leading natural gas producer.
BG confirmed earlier this year that it had secured access to a 200-acre section of coastal land on the Ridley industrial development site, owned by the Prince Rupert Port Authority, to assess the viability of an LNG terminal there. The port normally provides companies 12 to 24 months to assess whether they can make a project work.
Monday’s pipeline announcement suggests BG is optimistic about the Prince Rupert site’s potential, although such projects require vast construction budgets and complex negotiations to secure enough gas to load onto tankers, and then sell to end users. As such, they come with a degree of uncertainty. Spectra’s Mr. Bloom said his company and BG expect to make final investment decisions in 2015. The pipeline project itself is forecast to create 4,000 construction jobs.
BG declined to comment on the terminal size it is contemplating, although spokesman David Byford said of the proposed pipeline: “All of the gas would be subscribed to BG Group.” In other words, it would feed only the BG terminal.
Victoria, Haisla agree to fast-track LNG project
Deal for Kitimat terminal opens door to first nation band’s involvement in future development
By Gordon Hamilton, Vancouver Sun, Sept 15, 2012
A new deal between the provincial government and the Haisla First Nation is key to developing B.C.’s LNG export potential, chief councillor Ellis Ross says. The provincial government and Haisla First Nation struck a deal Friday that they say will fast-track the development of another liquefied natural gas export terminal at Kitimat.
In announcing the deal – a framework agreement that enables the Haisla to either purchase or lease a site on Crown land already identified as ideal for an LNG terminal – Haisla chief councillor Ellis Ross said it opens the door to Haisla involvement in future LNG development. Two major terminals have already been announced at Kitimat.
“It is our intent to responsibly develop projects and get them underway so that B.C. and Canada can take advantage of the LNG window that is now in front of us,” Ross said at a news conference where he was joined by Energy Minister Rich Cole-man and Aboriginal Relations Minister Ida Chong. “If we are able to do this, the Haisla people will benefit, B.C. will benefit and ultimately, Canada will benefit.”
The deal between the two par-ties circumvents issues around the cumbersome treaty process and opens the door for the Haisla to negotiate directly with energy companies.
“It’s going to be up to us to say who will be the successful proponent,” Ross said.
Chong described the deal as key to developing the province’s LNG export potential. The province has set a goal of having three LNG export terminals operating in northwestern B.C. by 2020.
The most advanced plan is by a consortium of companies headed by Apache Resources, which is already doing site preparation work on Haisla reserve land adjacent to the site announced Friday.
The second, a consortium headed by Shell Canada, has purchased a site with a deep water port within the city of Kitimat.
Coleman said five projects are now on the drawing board, including a smaller plant that would be co-owned by the Haisla.
“There are three in Kitimat, two in Prince Rupert. But I do know there is one other looking at Kitimat and one other looking at Prince Rupert,” Cole-man said. He identified global energy giant Exxon Mobil as one of the companies.
The framework agreement gives the Haisla the right to purchase or lease 700 hectares of land for an LNG terminal and a foreshore lease on 102 hectares of ocean floor for a berthing facility. Ross described the agreement as “a huge step” towards improved relations with the province.
“What First Nations are really after is this: If you are going to develop the land, why should First Nations be excluded from any wealth or opportunities associated to the land?
In some cases, the province was on the other side of the (treaty) table, arguing against rights and title interests. Now we have a provincial government saying ‘OK let’s set that aside for a second, how do we get your interest on the land?’ ”
Ross said energy export opportunities are limited on Douglas Channel, the body of water connecting Kitimat with the ocean. There are only two other sites identified by the Haisla that are not connected to salmon streams and also have deep water access.
If all the proposed plants were to go ahead, Coleman said it would bring new investments into the province of $16 billion for pipelines, about $10 billion for LNG plant construction, and roughly $1 billion for each natural gas-fired genera-tor required to power the new industry. There is only sufficient Hydro power for two of the proposed plants.
Coleman said the government has changed the Clean Energy Act to permit natural gas to be classified as a clean source of energy if it is used to power pipelines and LNG plants. He said he did not have numbers on the cumulative greenhouse gas impacts if the developments go ahead.
However, Colin Campbell, a science adviser for Sierra Club BC, said the province should be adding up the cumulative impact of the greenhouse gas emissions around the development of LNG. Pressurizing the pipelines that will bring the gas to the coast and liquefaction plants at Kitimat and Prince Rupert requires heavy energy use, he said.
“There is a price to pay for what looks like a better deal than coal,” he said.
* How clean is natural gas?, from the David Suzuki Foundation, June 26, 2012: http://www.davidsuzuki.org/blogs/panther-lounge/2012/06/how-clean-is-liquefied-natural-gas/
* BC’s focus on liquefied natural gas makes no sense for climate or economy, by Ben Parfitt. Canadian Center for Policy Alternatives, BC office, July 17, 2012 http://www.policyalternatives.ca/publications/commentary/bcs-focus-liquefied-natural-gas-makes-no-sense-climate-or-economy
* Pipeline setback for Enbridge doesn’t deter tar sands/natural gas rush in British Columbia, by Roger Annis, July 14, 2012 http://rogerannis.com/pipeline-setback-for-enbridge-doesnt-deter-tar-sandsnatural-gas-rush-in-british-columbia/
* Huge expansion in electricity generation required to feed gas liquefaction, by Gordon Hamilton, Vancouver Sun, June 4, 2012 http://rogerannis.com/electricity-demand-to-rise-50-per-cent-by-2032-bc-hydro/
* Fracking up our water, hydro power and climate: BC’s reckless pursuit of shale gas, by Ben Parfitt, a CCPA publication, November 2011, 53 pages
* U.S. Energy Security: Why Fracking for Oil and Natural Gas Is a False Solution, by Food and Water Watch, November, 2012. View and download the report (32 pages) at: www.foodandwaterwatch.org.