Friday, December 5, 2014

Parallel Universe - Canadian LNG Blues

Canadian LNG projects are similar to The Alaska LNG effort with some upstream and climatic differences. (LINK TO LNG-N-BC)

A week ago I would have predicted success for the Petronas led Pacific Northwest LNG project but apparently the project economics are not meeting client expectations (Globe and Mail Link). 

At 19.2 MMTPA, the PNW LNG project has about the same capacity as the Alaska LNG project. Gas is supplied to the PNW project via the Prince Rupert Gas Transmission Project which is 560 miles long (240 miles shorter than the Alaska LNG project).  Unlike Alaska, significant upstream development is required to provide gas to the PNW pipeline.

A final investment decision was due this month.

LINK to Map of BC Gas Pipelines

LINK to BC LNG information (BC Environmental Assessment Office website)

LINK to PNW Data

PETRONAS statement regarding LNG development in British Columbia

Quote: PETRONAS and its partners have decided to defer the project’s $36 billion Final Investment Decision (FID) pending further clarity on substantive items of importance to ensure that critical project components align with economic viability of the Project and competition from other LNG producing countries. Costs associated with the pipeline and LNG facility remain challenging and must be reduced further before a positive FID can be undertaken.

ASAP Update

Supplemental environmental impact statement (SEIS) documents are available HERE.

Summary of design changes (page 15 of the presentation)