HOME PAGE SUBSCRIPTIONS, Print Editions, Newsletter PRODUCTS READ THE PETROLEUM NEWS ARCHIVE! ADVERTISING INFORMATION EVENTS PAY HERE

Providing coverage of Alaska and northern Canada's oil and gas industry
December 2018

Vol. 23, No 52 Week of December 30, 2018

Exxon withdraws from C$25 billion WCC LNG plan in B.C. Canada

Gary Park

for Petroleum News

Just 12 months ago, Canada’s National Energy Board had issued 35 LNG export/import licenses - 28 in British Columbia, three in Quebec, three in Nova Scotia and one in New Brunswick - a source of unrestrained enthusiasm in B.C.

Canadian LNG activities moved into high gear in 2012 as the industry set its sights on taking advantage of high LNG prices in Asia and growing demand.

What a difference the last six years have made, with many projects getting shelved or cancelled as one by one they became entangled in popular opposition, government intentions to reduce greenhouse gas emissions, and a cooling of the Asian markets, leaving only two B.C. ventures in the construction phase - the small Woodfibre project and the Shell-led C$40 billion LNG Canada undertaking.

The only other mega-scheme, ExxonMobil’s C$25 billion WCC LNG plan in partnership with its Canadian subsidiary Imperial Oil, got shelved on Dec. 20.

ExxonMobil withdrew the proposal from its environmental assessment phase, although a spokeswoman said her company “remained committed to our Canadian operations,” which are concentrated in Alberta’s heavy oil deposits.

The outlook for the project took a sharp reversal earlier this year when Imperial took a writedown of C$289 million on its northern B.C. Horn River shale gas development, a 50-50 venture with ExxonMobil that was expected to become the major source of feedstock for WCC LNG.

The original application for WCC LNG laid out plans to produce about 15 million metric tons of LNG a year and to later double that output.

Four years down the drain

The four years of environmental review by the Canadian Environmental Assessment Agency is now effectively work down the drain, with ExxonMobil faced with having to resume from the beginning if it ever hopes to revive the project.

Aside from the challenges of securing Asian buyers, WCC LNG was also faced with growing resistance in B.C. to any new fossil fuel undertakings.

Government estimates show that LNG Canada will emit about 3 million metric tons a year of carbon dioxide at a time when the province has committed itself to lowering GHG emissions from 60 million metric tons to 35 million metric tons by 2030 to achieve its legislated target.

B.C. Premier John Horgan took the high road, arguing that “big investments like (LNG Canada), though it has an impact on our GHG numbers, gives us an opportunity to be bold on government-directed innovation on things like transit.”

Clean Energy Canada estimates that either 900,000 B.C. drivers would need to replace their gasoline or diesel-powered vehicles with electric vehicles, or 950,000 homeowners would need to replace natural gas furnaces with either electric heat pumps or 100 percent renewable natural gas, just to eliminate the carbon emissions from LNG Canada.

- GARY PARK






Petroleum News - Phone: 1-907 522-9469
[email protected] --- https://www.petroleumnews.com ---
S U B S C R I B E

Copyright Petroleum Newspapers of Alaska, LLC (Petroleum News)(PNA)Š1999-2019 All rights reserved. The content of this article and website may not be copied, replaced, distributed, published, displayed or transferred in any form or by any means except with the prior written permission of Petroleum Newspapers of Alaska, LLC (Petroleum News)(PNA). Copyright infringement is a violation of federal law.