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Canada: Spectra Energy, BG Sign Project Development Deal

Spectra Energy Corp announced that the company has signed a Project Development Agreement with BG Group to jointly develop plans for a new natural gas transportation system from northeast B.C. to serve BG Group’s potential liquefied natural gas (LNG) export facility in Prince Rupert, on the province’s northwest coast. Spectra Energy and BG Group will each initially own a 50 percent interest in the proposed transportation project.

Spectra Energy will be responsible for construction and operation and BG Group has agreed to contract for all of the proposed capacity.

The approximately 850-kilometre (525 mile), large diameter natural gas transportation system will begin in northeast B.C. and end at BG Group’s potential LNG export facility in Prince Rupert. The new transportation system will be capable of transporting up to 4.2 billion cubic feet per day of natural gas. The project also will connect with the Spectra Energy system at Station 2 (southwest of Fort St. John), a growing natural gas hub that collects supply from multiple areas of the province and other supply basins in Western Canada.

“We are excited to be partnering with BG Group, a recognized world leader in natural gas and more specifically, LNG,” said Greg Ebel, president and chief executive officer, Spectra Energy. “This project offers B.C. a unique opportunity to access new markets, strengthen its energy infrastructure, engage stakeholders in economic growth and job creation, and ultimately secure the province’s position as a competitive energy leader.”

“Furthermore, today’s announcement initiates our next wave of investment opportunity in B.C. We are ideally positioned to create further value for our investors by leveraging surplus B.C. natural gas supplies and facilitating its export to high-demand markets in Asia. This, in turn, will provide multiple opportunities for further investment in our gathering and processing facilities in the province,” added Ebel.

“For more than half a century, Spectra Energy has been a part of communities in B.C.,” said Doug Bloom, president, Spectra Energy Transmission West. “This project will build on our expertise and track record of delivering natural gas responsibly, listening to the needs of Aboriginal and local communities, and protecting the environment, as we help deliver on B.C.’s energy potential.”

Working together with affected stakeholders and based on preliminary assessments of environmental, historical, cultural and constructability factors, early conceptual routes have been developed. Spectra Energy and BG Group will continue engaging with interested and affected stakeholders, including Aboriginal and local communities, environmental organizations and regulatory agencies, to further refine the project route.

In addition, the companies will spend the next several years closely conferring with stakeholders and working through the permitting process for the proposed transportation system. This work will include filing a project application with the B.C. Environmental Assessment Office. Based on the results of these efforts, project construction is currently expected to commence mid-decade, with service starting by the end of the decade.

As part of this commitment to transparently communicate and foster relationships in the province, Spectra Energy also announced “Energy for BC”. The new outreach initiative is designed to engage with stakeholders on the jobs, revenues and environmental benefits that natural gas can create in British Columbia.

Spectra Energy, BG Sign Project Development Deal, Canada LNG World News.

APP to Conduct Solicitation of Interest in Pipeline Capacity, Alaska

The Alaska Pipeline Project (APP) announced that it will conduct a non-binding public solicitation of interest in securing capacity on a potential new pipeline system to transport Alaska’s North Slope gas.

The solicitation of interest will take place from August 31 through September 14, 2012.

The solicitation of interest is being conducted to identify parties potentially interested in making future capacity commitments on a pipeline system from the Alaska North Slope to a gas liquefaction (LNG) terminal at a tidewater location in south-central Alaska or to an interconnection point near the border of British Columbia and Alberta in Canada.

APP will conduct the solicitation of interest in accordance with the Alaska Gasline Inducement Act (AGIA), which requires TransCanada, as the AGIA Licensee, to assess market interest in a pipeline transportation system for Alaska North Slope gas every two years after its first open season.

APP has set a high priority on providing access opportunities for in-state natural gas to heat and power local homes, business and industry. All options being pursued under AGIA provide for a minimum of five delivery points for local natural gas connections in Alaska.

APP is a joint effort between affiliates of TransCanada Corporation and Exxon Mobil Corporation to develop a natural gas pipeline under AGIA.

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USA: Apache Finds Huge Shale Gas Reserves in Liard Basin

Apache Corp. has found a huge amount (up to 48 trillion cubic feet) of natural gas in its Liard Basin properties in northeastern BC. All of the gas is targeted to ship to a proposed LNG plant which should be built at Kitimat, according to Refinery News.

As the company says, it is the best unconventional gas discovery in North America. They have rights to drill 430,000 acres within the region.

Because of the low gas price, it is expected that the drilling plans in the Liard region could be very slow.

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Obama’s Indefensible Pipeline Punt

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CARPE DIEM

Professor Mark J. Perry's Blog for Economics and Finance

Some excerpts from Vaclav Smil‘s article in the American.com:

“With a total length of close to 3,000 kilometers, the new [Keystone XL] pipeline would add just over 1 percent to the already existing network of crude oil and refined products lines that crisscross the United States and parts of Canada. Why, if pipeline safety is a key concern, have we not seen waves of civil disobedience focused on more than a quarter million kilometers of existing pipelines?

Long-term statistics show convincingly that there is no safer way to transport large masses of liquids over long distances than a pipeline. Moving the same amount by trucks or rail would be much more risky, in addition to being vastly more expensive. So would be moving the oil from Alberta to British Columbia and then shipping it by tankers via the Panama Canal to Texas.

Here comes the craziest twist: if the opponents of the XL succeed and prevent its construction, there is a strong possibility that Alberta’s oil sand-derived oil will be piped westward to Canada’s Pacific coast and loaded on supertankers going to Asia, to feed China’s grossly inefficient industries.

By preventing the oil flow from Canada, the United States will thus deliberately deprive itself of new manufacturing and construction jobs; it will not slow down the increase of global CO2 emissions from fossil fuel combustion; it will almost certainly empower China; and it will make itself strategically even more vulnerable by becoming further dependent on declining, unstable, and contested overseas crude oil supplies. That is what is called a spherically perfect decision, because no matter from which angle you look at it, it looks perfectly the same: wrong.”

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