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LNG projects on the move in B.C.
Gary Park For Petroleum News
The two liquefied natural gas terminals planned for deepwater ports in northern British Columbia continue to thumb their noses at analysts who believe only one can survive.
Kitimat LNG and WestPac LNG both reported progress in the regulatory stream June 6, with Kitimat gaining an apparent edge after obtaining environmental approval from the British Columbia government, while WestPac submitted a regulatory application.
Both opted to locate their terminals in British Columbia, believing community support and a better-defined environmental process afford a comfort zone that is not available in California and Oregon, where a number of projects are colliding with the NIMBY (not in my backyard) syndrome.
Kitimat, led by former Duke Energy executive Alfred Sorensen, is aiming to open a C$500 million plant near Kitimat in 2009, with initial processing capacity of 600 million cubic feet per day of send-out capacity.
WestPac, guided by Jack Crawford, the driving force behind the Alliance gas pipeline from British Columbia to Chicago, has projected start-up costs of C$350 million to handle 300 million cubic feet per day, with an in-service date of 2011.
Kitimat would have 6.5B in storage Kitimat, a unit of Galveston LNG, is designing a storage terminal to handle 6.5 billion cubic feet per day, utilizing commercial agreements with the Pacific Northern Gas pipeline system to gain access to trunk lines serving markets in British Columbia, Alberta, the Pacific Northwest and California.
But the primary initial targets are expected to be gas users on the B.C. coast and oil sands producers in Alberta.
WestPac has also talked about selling into major North American markets, but is concentrating for now on a small regasification facility to serve the Prince Rupert area while reloading some LNG onto vessels, such as barges, for delivery to customers on the B.C. coast, Greater Vancouver and Vancouver Island.
The biggest challenge now for the two proponents is to secure contracts with suppliers in Australia, Malaysia and Indonesia.
Kitimat President Rosemary Boulton told reporters the B.C. environmental certificate will facilitate that process by giving certainty to the project, although a permit is still needed from the Canadian government.
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