Smithers council votes to oppose Northern Gateway, fourth council within a month

Smithers has become the third northwestern British Columbia municipal council to vote against the Enbridge Northern Gateway Pipeline, joining Prince Rupert and Terrace. Earlier, one regional district, Skeena Queen Charlotte, also voted against the controversial pipeline and tanker project.

The vote in Smithers was 5-1.

Smithers Councillor Phil Brienesse, in a statement posted on his Facebook page,  said

I brought forth a new motion to oppose the Enbridge Northern Gateway project. The motion passed 5-1 after careful and considerable debate by council. My decision was based in part on new information that came out from recent decisions made in Terrace, SQCRD, and Prince Rupert that made it clear that local governments had the right and are clearly permitted to provide information to the Joint Review Panel. Since the previous motion was tabled with the reasoning being that it was felt we should not be influencing the JRP it seemed appropriate to bring forth a new motion at this time taking into consideration that we made the decision based on the information currently available.

 

Brienesse was quoted by CFJW on Tuesday night: “I hope this really brings our community together and in particular what it does, is it brings the north together so now we have Smithers, Terrace, Prince Rupert, and the Skeena Queen Charlotte Regional District all opposing Enbridge, in their own unique ways that makes sense to their community,” said Brienesse, adding “we have  a united North, so I am very positive about this.”

CFJW said the only vote against the motion was from Councillor Charlie Northrup, who noted not all councillors were present for last night’s meeting — and he wanted to table it until everyone was there.

Enbridge spokesman Paul Stanway, speaking on CBC Radio, repeated what he said to Northern View after the Prince Rupert vote, that it was better for all communities to wait until the Joint Review Panel had finished the hearings and then make a decision based on all the evidence.

Prince Rupert council votes unanimously to oppose Northern Gateway project

Prince Rupert council has joined Terrace and the Skeena Queen Charlotte Regional District in voting to oppose the Enbridge Northern Gateway pipeline project and associated tanker traffic on the west coast.

The Prince Rupert Council vote was unanimous.

The council has adopted the same resolution that the Skeena Queen Charlotte Regional District (SQCRD) did over a week ago:

Therefore, be it resolved that the City of Prince Rupert be opposed to any expansion of  bulk crude oil tanker traffic as well as bitumen export in Dixon Entrance, Hecate Strait  and Queen Charlotte Sound in British Columbia.

And be it further resolved that the City of Prince Rupert petition the federal government  to establish a legislated ban on bulk crude oil tanker traffic and bitumen export through  the Dixon Entrance, Hecate Strait and Queen Charlotte Sound in British Columbia.”

The council debate took place before a packed audience. Council decided to consider the matter after the Prince Rupert Environmental Society that asked the city council to adopt the resolution.

Like some other northern councils, including Kitimat, Prince Rupert had remained neutral on the controversial pipeline.

Related: Douglas Channel Watch calls on Kitimat council to “get off the fence”

Councillor Jennifer Rice said it was time for the city to make its position clear. She said the Enbridge Northern Gateway Joint Review panel was asking northern municipalities for their opinion (although actually the opinion and argument phase of the JRP hearings won’t take place until the “final arguments” currently scheduled for sometime around April 2013).

Rice said Prince Rupert’s silence could have been taken as acceptance of the $5.5-billion proposal to pipe Alberta oil across B.C. to Kitimat, where supertankers would carry it to overseas customers.

Other members of council agreed with Rice, expressing concerns about damage that could be caused if a Very Large Crude Carrier (a supertanker) could get into trouble.

The mayor, Jack Mussallem, argued, as have others across the northwest, that council should wait until the Joint Review Panel concludes its hearings, when all appropriate information was available. He did not vote. (After the vote in Terrace, B.C. Energy Minister Rich Coleman said local representatives to follow the provincial government’s lead and remain neutral until a federal environmental review is complete.)

In response to the vote at Prince Rupert, Enbridge Northern Gateway spokesman, Paul Stanway issued a statement to the Northern View which reads.

Prince Rupert city council has expressed a position on the Northern Gateway project and that is their right. Surely the best time to make a decision in the public interest is when all the facts are known?

Northern Gateway is in the midst of an extensive federal review which will examine the project in detail and in public – as it should. We would hope that people will wait until they have an opportunity to hear the facts before making up their minds.

Most of the communities along the corridor have taken a neutral position until this regulatory review has been completed. This is fair to everyone, and it allows elected officials to get a full view of the project with all the facts having been aired through the review process – which then allows them to make an informed decision.

Numerous communities – in Alberta, Saskatchewan and Manitoba who have a history of working with Enbridge – have written letters of support for the project and filed them with the Joint Review Panel.

It is our view that the more people learn about the project, the more they tend to support Northern Gateway. A recent Ipsos Reid poll found that, among British Columbians, those in the North are the most familiar with the project, and they are also the most supportive.

(As Northwest Coast Energy News pointed out at the time, that poll had a large margin of error when it came to northern residents and it was unclear if the poll was weighted in favour of one northern region or another)

TERMPOL report on Enbridge marine operations sees “no regulatory concerns,” tankers could be “unassisted” by tugs

A report from TERMPOL for the the Joint Review Panel on Enbridge’s proposed marine operations for the Northern Gateway pipeline project, finds

While there will always be residual risk in any project, after reviewing the proponent’s studies and taking into account the proponent’s commitments, no regulatory concerns have been identified for the vessels, vessel operations, the proposed routes, navigability, other waterway users and the marine terminal  operations associated with vessels supporting the Northern Gateway Project. Commitments by the proponent will help ensure safety is maintained at a level beyond the regulatory requirements.

Even though Enbridge has promised that tankers would have escort tugs, the report goes to so far as to suggest that super tankers could come and go along Douglas Channel “unassisted.”

TERMPOL has taken all the assurances from Enbridge at face value, including the use of escort tankers, and takes into consideration the company’s proposed  “environmental limits (weather and sea conditions) on oil tanker navigation,” and “commitment to use industry best practices and standards.”

The report says:

The overall increase in marine traffic levels is not considered to be an issue for the shared safe use of the  project’s preferred shipping routes. The proponent has also committed to including safe speeds for oil tankers and tugs in its terminal rules and requirements. It will also include safety limits for environmental and marine conditions for both vessels and terminal operations.

With the increase in shipping activity, there may be an increased threat to the well-being of marine  mammal populations along the shipping route. To address this risk, the proponent has proposed measures to avoid contact with mammals. The proponent is encouraged to develop appropriate procedures to help minimize harmful effects on marine mammals.

 

Read the report: Transport Canada Process Report on the Enbridge Northern Gateway Project (PDF)

In a news release, Enbridge welcomed the findings,  quoting Janet Holder, Enbridge’s Executive Vice-President of Western Access and the senior executive with responsibility for Northern Gateway, as saying: “It is important for the public, particularly BC residents, to know that we’ve done our homework and that our marine plan has been thoroughly reviewed. I think the TERMPOL review underlines that what we are proposing is well planned and safe – and indeed would enhance safety for all shipping on BC’s north coast.”

The release says “Northern Gateway is encouraged by the positive conclusions of this technical review of the marine components of the project – including the safe operation of the Kitimat terminal and safe passage of tankers to and from the facility through Canadian waters.”

Related Tanker traffic could mean safety restrictions for recreational boating and fishing on Douglas Channel

TERMPOL  is an intergovernmental agency made up of officials from Transport Canada, Environment Canada, Fisheries and Oceans, Canadian Coast Guard and the Pacific Pilotage Authority. It can make recommendations and compliance with the recommendations is “voluntary.” So far companies contemplating tanker operations along the northwest coast have agreed to follow the TERMPOL recommendations.

Marine safety simulator
A marine safety simulator (Enbridge Northern Gateway)

All of the conclusions depend on Enbridge’s commitment to implement and monitor practices for safer shipping for the Northern Gateway Project. “Tankers and shipping operations, like any other vessel operations, will have to comply fully with national and international regulatory frameworks. Through the proponent’s oil tanker vetting and acceptance process, ship operators will have to follow the proponent’s additional safety enhancements, which are designed to reduce the risks during operations.”

Termpol did note that with up “to 250 additional tankers per year  arriving in Kitimat, there will be an impact on Transport Canada’s compliance monitoring programs.” This comes at a time the government of Stephen Harper is already drastically cutting the resources for the Department of Fisheries and Oceans and the Canadian Coast Guard on the west coast and is making across the board cutbacks at Environment Canada.

The simulations show that the largest proposed oil tankers are capable of safely navigating the entire proposed shipping route, unassisted. The route includes an S-curve where the channel widths are between 3,500 and 5,000 metres. Navigation simulations carried out by the proponent have demonstrated that a typical 320,000 tonne crude oil tanker loaded, or in ballast, can safely negotiate this area.
TERMPOL report

Based on reviews by the Canadian Coast Guard and computer simulations of bridge operations, the teports says the waterways comply with all Canadian and international regulations and says:

The proposed routes provide the required clearances for good vessel manoeuvrability and allowances for very large crude oil tankers to safely navigate…

The simulations showed that tankers of the largest design are capable of navigating the entire route un-assisted. This is also consistent with opinions of Pacific Pilotage Authority Canada and the British Columbia Coast Pilots. The British Columbia Coast Pilots identified some narrow sections of the waterways as warranting caution for two-way traffic. The Canadian Coast Guard identified that the Lewis Passage-Wright Sound area warrants caution as a result of multi-directional traffic. In practice, the British Columbia Coast Pilots, supported by information from Marine Communications and Traffic Services, would adjust a vessel’s speed to avoid meeting other vessels in these areas. Transit speeds may also have to be adjusted to take into account traffic in the Wright Sound area.

TERMPOL says the “proposed shipping routes are appropriate for the oil tankers that will be used at the proposed terminal,” largely because Douglas Channel is so deep.

The next sentence says “there are no charted obstructions that would pose a safety hazard to fully loaded oil tankers,” which was pretty well known by people who sail Douglas Channel.

Testimony at the Joint Review hearings in Kitimat, presentations to District of Kitimat council and the history of the region, as related by both aboriginal and non-aboriginal sailors, show that there are concerns about dangerous storms, general heavy weather, tricky winds off the mountains and currents from the rivers meeting the ocean.

The report also says the Canadian Hydrographic Service is in the process of updating several charts of the area to ensure the most accurate information is available for safe navigation.

The report does acknowledge that there could be a tanker collision in certain areas of the British Columbia coast, saying: “The narrower passages along the North and South routes, each with charted depths of 36 m (20 fathoms) or more are all wide enough for two-way navigation by the largest design vessel,” but adds that while “the proposed channels meet the specified requirements for two-way marine traffic, the BC pilots “may choose to ensure that passing and overtaking situations do not occur in the narrowest sections, by good traffic management.”

It says that in certain areas  “that the meeting of two large ships …. should, in general, be avoided, particularly during severe (wind 30 knots or above) weather  conditions. The reason for this restriction is that the margins for safe navigation are limited in case of an emergency situation where the engine is lost or the rudder is locked at an angle different from ‘mid ship’.”

According to the pilots, the meeting of ships at these locations can easily be avoided through   oroper planning and pilot to pilot communication and available navigation and ship tracking data.

It adds, as Enbridge has proposed, “In order to mitigate risk, all laden tankers will have a tethered escort tug throughout the Confined Channel sections (from Browning Entrance or Caamaño Sound to the Kitimat Terminal).

The report adds:

It is important to keep in mind that the emergency situations described rarely occur, but that it is necessary for the Pilots and Tug Masters to rehearse these situations on a regular basis in order to be  prepared in case an incident actually occurs.

 

Related TERMPOL

More pipeline debate coming to the Northwest: Changes to the Pacific Trails natural gas Pipeline

Pacific Trail Pipelines map
The Pacific Trails Pipeline map as of Feb. 2012. (PTP/BCEAO)

Another pipeline debate is about to open in the northwest. This time for  changes to the Pacific Trails (natural gas) Pipeline, that will run from Summit Lake, just outside Prince George, to Kitimat.

Public information meetings will be held in Terrace, Houston, Burns Lake and Vanderhoof in the next couple of weeks.

The PTP runs entirely within British Columbia, and so comes under the jurisdiction of the Environmental Assessment Office of  British Columbia.   The application to build the PTP was filed in 2005 and approved in 2008 which means the process for the amendments will go much faster than the current Northern Gateway Joint Review hearings for the Enbridge twin bitumen/condenseate pipeline which are expected to last at least another eighteen months.

Pacific Trails is asking to

  • Change the location of the compressor station;
  • Establish two new temporary stockpile sites;
  • Make pipeline route modifications

The period for commenting on the Pacific Trails Pipeline amendments opens on February 27 and closes March 28. The public meeting on the changes to the compressor station were held in Summit Lake last September.

The documents filed with the BCEAO say that Pacific Trails Pipelines is in ongoing negotiations with First Nations where the PTP will cross their traditional territory.

The natural gas project has general support in northwestern  BC, and the relations between First Nations and PTP, and Apache, the main backer of the Kitimat LNG project are much better than those with Enbridge. (The PTP would supply the liquified natural gas terminals in Kitimat)

Significantly, the documents show that the PTP is trying to enter separate negotiations with the Wet’suwet’en houses that are now objecting to the pipeline route through their traditional territory.

The filing says:

In addition, PTP is now consulting, or making all reasonable efforts to consult, with one of the 13 Wet’suwet’en Houses as a discrete entity. PTP was informed in February 2011 that Chief  Knedebeas’s House, the Dark House, was no longer part of the Office of the Wet’suwet’en  although the latter still maintains responsibility for the welfare of all Wet’suwet’en lands and  resources. Consultation that took place prior to this year with the Office of the Wet’suwet’en included consultation with the Dark House. PTP has been diligent in seeking to consult with  the Dark House since April 2011. The spokesperson for Chief Knedebeas of the Dark House, Freda Huson, states that she also represents a group called Unist’ot’en.

 

 

But it’s Enbridge that is the sticking point, and could bring controversy to this amendment request.  The Wet’suwet’en houses that blockaded a PTP survey crew last fall said they were worried that the Northern Gateway pipeline follows roughly the same route as the PTP. The PTP application was filed and approved long before the controversy over the Enbridge Northern Gateway began to heat up.

One reason is that original approval was for a pipeline to import natural gas before the shale gas boom changed the energy industry.  As PTP says in the application to change the compressor station.

When the original purpose of the PTP Project was to transport natural gas from an LNG import facility at Kitimat to the Spectra Energy Transmission pipeline facilities at Summit Lake, the design called for the installation of a mid-point compressor station to enable the required throughput of natural gas. This compressor station was sited at the hydraulic mid-point of the pipeline. The location of the compressor station in 2007 was south of Burns Lake and just east of Highway 35.

Now that the PTP Project is designed to move natural gas from Summit Lake to Kitimat, or east to west, a compressor station is required at Summit Lake rather than at the hydraulic mid-point of the pipeline. The new Summit Lake compressor station is required in order to increase the pressure of the natural gas from where it is sourced at the Spectra Energy Transmission pipeline facilities.

The EAO will hold open house meetings on the pipeline route changes from 4 pm to  8 pm at each location at

Monday, February 27, 2012
Nechako Senior Friendship Centre, 219
Victoria Street East
Vanderhoof, BC

Tuesday, February 28, 2012
Island Gospel Gymnasium
810 Highway #35
Burns Lake, BC

Wednesday, February 29, 2012
Houston Senior Centre
3250 – 14th Street W
Houston, BC

Thursday, March 1, 2012
Best Western Plus Terrace Inn
4553 Greig Avenue
Terrace, BC

The EAO says: Displays containing information on the proposed amendments will be available for public viewing. The EAO will be available to answer questions on the amendment process. The Proponent will be available to answer questions on the Project and proposed amendments.

The documents show there are route changes to the pipeline route along the Kitimat River, but those are considered “minor route adjustments” so no meetings are planned for Kitimat.

Documents

PTP meeting schedule

Complete filing documents from PTP are available on the BCEAO site here.

Pacific Trails Pipeline

The No To Tankers Rally, Prince Rupert, BC, Feb. 4, 2012

Audio slideshow: No To Tankers Rally, Prince Rupert, Feb. 4, 2012No To Tankers Rally
The Gitga'at First Nation led the No To Tankers Rally in Prince Rupert, BC, February 4, 2012.

 

Click on this link to launch audio slideshow

A crowd estimated by the media at high of more than 2,000 to a low of about 600, marched through the streets of Prince Rupert on Saturday, February 4, to protest against Enbridge’s $5.5-billion Northern Gateway bitumen pipeline and the associated super tanker traffic.

The protest was organized by the Gitga’at First Nation, of Hartley Bay, at the mouth of Douglas Channel . Nearby Wright Sound, known for its tricky currents and winds in bad weather would be the passageway for most of the tanker.

The Tsimshian First Nation, the hosts, welcomed the Gitga’at and protestors from other First Nations and reisdents of northwestern BC, before the the march began at Pacific Marinter’s Memorial Park.

It ended at the Jim Ciccone Civic Centre, where, iin the afternoon, speakers spoke about environmental concerns, followed by a dancing and concert in the evening.

Gitga’at boats from Hartley Bay rescued passengers after the sinking of the ferry Queen of the North in 2006.

The Gitga’at say oil still leaks from the Queen of the North, affecting some shellfish beds in the area.

Kitimat Methanex dismantling contract cancelled by Chinese buyer

Kitimat

Updated Nov. 15, with Shell statement
The Chinese company that bought the plant and equipment at the Methanex site in Kitimat has cancelled the dismantling contract according to the company that was doing the work.

Blue Horizon Industries of Red Deer, issued a news release early Monday, Nov, 14, saying that Ko Yo Development had issued a termination notice of the contract. 

Blue Horizon’s parent firm BH Energy says it has

objected to the grounds for termination alleged by Ko Yo
and intends to vigorously enforce its rights and remedies under the
agreement and otherwise available at law against the contracting parties
for amounts owing to date as well as further damages.

Blue Horizon says it was in the final stages of dismantling an ammonia
plant and a methanol plant at Kitimat B. C. for Ko Yo and readying them
to be shipped to China.  The company says that from February 2011 to date, BH Energy has been
paid and or credited by Ko Yo approximately USD $15.9 million of the
$20.4 million contract.

Donald Allan, President and CEO of Blue Horizon, said “We are
disappointed that we will not be given the opportunity at Kitimat to
finish the job for Ko Yo, who are experiencing significant logistical
issues… He added the company would proceed with other projects in other areas.

Ko Yo Chemical (Group) Limited, formerly Ko Yo Ecological Agrotech (Group) Limited, is a Hong Kong based investment holding company. According to a company profile it is engaged in the research and development, manufacture, marketing and distribution of chemical products, chemical fertilizers and bulk blending fertilizers and has a natural gas energy utilization project at Dazhou City, Sichuan Province, China. The company has a number of subsidiaries with similar names.

The contract to dismantle the old Methanex plant was signed in February, 2011 and then renegotiated in September, 2011. (pdf)

Shell purchased the Methanex site and marine terminal in October, 2011, as part of its plans for a liquified natural gas facility at Kitimat. Shell spokesman Stephen Doolan told Northwest Coast Energy News  “The transaction … does not affect Shell’s purchase of the Cenovus property, nor is Shell involved in any way.”

China biggest customer for Kitimat LNG: Encana

Energy

564-ecanalogo75.jpgChina is probably the largest long
term customer for liquified natural gas that will be shipped through
the port of Kitimat, executives from Encana, one of the three
partners in the KM LNG project said in an investor conference call
Tuesday, Oct. 4, 2011.

India could also be big customer for
LNG shipped from the Horn River in northeastern BC through Kitimat,
Encana said.

Although Japan will be increasing its
purchases of liquified natural gas in the coming years, the immediate
situation with Japan is less certain. While the March 2011
earthquake and tsunami knocked out the Fukishima nuclear plant and
prompted Japan to scale back other nuclear plants and increase LNG
purchases, Encana says the country has still not come up with any
definite policies

559-chinalng.jpgDave Thorn, Encana vice president of
Canadian marketing, who also oversees the Encana’s role in the
Kitimat project, said that China’s overseas imports now account for
eight per cent of its purchases of natural gas. That is expected to
rise to 10 per cent in the next few years. Thorn said there is a big
gap between current LNG contracts and what Encana says is long term
demand from China. He speculated that there could be increasing
demand from China during the 20 years or so the Kitimat LNG project
is exporting LNG. ( As well as projected population and
manufacturing growth, even in a weak economy, China is now heavily
dependent on coal, but is also investing in “green” projects
which means there could eventually be a switch from coal to natural
gas).

The fact that one giant Chinese
customer, PetroChina, pulled out of a deal with Encana earlier this
year doesn’t seem to be a setback. Thorn said that there is strong
interest from at least six unnamed major customers for LNG to be
shipped through Kitimat. “The expression of interest ranged from
simply LNG supply to existing or planned regasification facilities
through to participation all along the value chain from shipping,
equity interest in the Kitimat facility as well as upstream
participation,” Thorn said.

561-kitimatlngmarket.jpgThe Kitimat project is currently
undergoing a front end engineering evaluation by KBR. There is a
similar study under way on the Pacific Trails Pipeline that could
carry the natural gas to the terminal. Both studies are expected to
be complete by the end of 2011. Encana expects the National Energy
Board to approve KM LNG’s application for an export licence in
December. Encana and its partners, Apache Corporation and EOG
Resources, expect to make a final investment decision in January
2012.

If all goes as planned the Kitimat
terminal would be shipping 700 million cubic feet of natural gas a
day to Asia when the terminal begins operations in 2015. Encana and
its partners are already optimistic, talking about plans to double
capacity to to 1.5 billion cubic feet a day in the coming years.

What’s driving much of this is the
high price of natural gas in Asia, which is pegged to the price of
oil, compared to North America where natural gas prices are
determined by the marketplace. With shale gas increasingly abundant
the price on this continent has been dropping and that has affected
the bottom lines and stock prices of Encana and other natural gas
producers. Encana is also bolstering its bottom line by tapping
“liquid-rich reserves” (oil and natural gas) that may be found
in the areas where they are currently pumping natural gas.

The Horn River Basin area in
northeastern BC was a surprise discovery by an Encana crew in 2003,
said Kevin Smith, Encana Vice President of New Ventures. The company
then began to quietly acquire assets, either by buying land or by
leasing in the region. “The Horn River resource base is enormous,
highly accessible and will certainly play a large role in North
American and even global gas supply in the years to come,” Smith
told the conference call.

During the June NEB hearings in
Kitimat, witnesses described the Horn River formation as special but
were reluctant to go into detail. Smith said the shale in the Horn River
is “all the attributes for high productivity,” including large
reserves and “overpressured system” which helps extraction. “It
keeps getting better and better.”

As well as going west to Asia, natural
gas from Encana’s Horn River assets will go east to Alberta to fuel
bitumen sands production which Smith said will require an additional
1.3 billion cubic feet a day by 2020, This is likely to be
controversial with the environmental groups and bitumen sands
opponents who have always taken issue with the idea that clean
natural gas would be burned to help get crude of the dirtier bitumen
sands.

563-lnghub.jpgEncana says it has developed a “hub”
system in the Horn River where a central well site can use horizontal
drilling to tap areas where once many wells would have been needed.

“Fracking” or fracturing shale gas
requires large amounts of water. As was pointed out in the June
hearings in Kitimat, Encana has tapped an ancient, underground alt
water reservoir called Debolt which allows it to reuse the water from
the formation and minimizing use of local fresh water.

British Columbia is helping the shale
gas industry with favourable royalties in the northeast including
royalty credits for building infrastructure in the region.

Encana, however, is under pressure
from inflation. It faces rising costs from steel, labour and all
kinds of services. While it supplies the bitumen sands with natural
gas, it is also in competition with the Fort MacMurray area for
supplies and labour.

Related links

Dow Jones (via Fox) Encana Eyes Asia As Key Market For B.C. Natural Gas

CP (via Canadian Business) Encana says costs of labour, steel, services rising in energy sector

Gitxaala First Nation settles with KM LNG

Energy

The Gitxaala First Nation has settled its dispute with the KM LNG (also known as Kitimat LNG) over it’s application before the National Energy Board for an export licence.

A letter from Robert Janes, representing the Gitxaala, was filed with the  NEB on Sept. 29, saying they were withdrawing their intervention and their motion for further hearings.

In original filings, the Gitxaala First Nation objected to a lack of consultation between the Crown and the First Nation as well as expressing concerns about the in adequacy of the Transport Canada TERMPOL process which is looking at the environmental and socio-economic effects of tanker traffic on the west coast. (TERMPOL is also part of the Enbridge Northern Gateway application).

One of the concerns of the Gitxaala that came in out in the June hearings in Kitimat was the effects of tanker wake on the coast.    Janes’ cross-examination of the KM LNG witnesses was one of the liveliest part of the Kitimat hearings.

No details of the settlement were released.

Related link: NEB adjourns KM LNG hearings as partnership talks to coastal First Nation

Shell considering giant floating LNG platform off BC Coast: Alberta Oil

Energy LNG  Link

Alberta Oil is reporting that Shell’s plans for a liquified natural gas export facility somewhere on the northern British Columbia coast will likely be a giant floating platform, similar to the platform planned for the coast of Western Australia.

Shell Canada sizes up LNG options offshore B.C.

Although costs, production volumes and timelines haven’t been worked out, industry observers like FirstEnergy Capital are speculating that Shell and its partners are considering building a floating LNG structure off B.C.’s coast. The Anglo-Dutch super-major knows a thing or two about floating LNG projects. In May, Shell received approval from the Australian government for its Prelude floating LNG project. Scheduled to start production in 2016, the Prelude structure will be located in the Browse basin off the coast of Western Australia

The length of the floating prelude platform, at  488 metres according to a diagram released by Shell and reprinted by Alberta Oil, would be longer than the height of the 446.5 metre Skypod/ Space Deck on the CN Tower and longer than the hieght of Kuala Lumpur’s Petronas Tower at 452 metres.  (The proportions in the Shell diagram of the CN Tower are not entirely accurate when compared to the information in the Wikipedia entry on the CN Tower)
518-tall_lng-thumb-500x454-517.jpg As reported in April by Alberta Oil Kitimat LNG faces Australian rivals the Western Australian development could rival Kitimat, a point that took up a lot of testimony at the June National Energy Board hearings into KM LNG’s application for an export licence.

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KM LNG hearings wrap with concerns over conditions

Energy

The National Energy Board hearings into the application from KM LNG for an export licence to ship liquified natural gas to Asia through Kitimat wrapped up in Calgary Thursday, with the main participants expressing concerns over conditions on the licence proposed by the NEB.

The board panel reserved its decision. No date was given for a possible decision. Unlike the earlier hearings  in June which were held in Kitimat, the Phase 2 hearings were held in Calgary and only available to residents of Kitimat by audio webcast

On July 6 and July 8, the board panel issued a list of 12 proposed conditions on the export licence.  (The concerns of the Kitimat Rod and Gun were not among the 12. See story here)

Among the conditions the NEB wants to impose are a detailed reporting requirement that would include the name of  the LNG tankers loading the natural gas, the quantity of gas and the revenue in Canadian dollars as well as the sales contracts KM LNG may sign with its Asian customers.

Those proposed conditions brought strenuous objections from the proponents of the project, voiced by lead counsel Gordon Nettleton and echoed by other lawyers, saying that the conditions could actually scuttle the entire project. That is because Asian buyers, whether private companies or sovereign (government) agencies, place much stricter emphasis on confidentiality of the agreements than in North America. The lawyers warned that the potential Asian customers could walk away from any deals in favour of less regulated vendors in other countries if the NEB insists on full disclosure, especially if the details could be made public either through the Access to Information Act or by NEB procedures and policies.

Nettleton and the other lawyers recommended a compromise where  KM LNG would disclose to the board the total exports each quarter, the aggregate value in Canadian dollars for each quarter,  the “heating value” of the aggregate and export totals by destination country.

The lawyers also objected strenuously to conditions proposed to cover environmental and social effects of building the Kitimat LNG terminal  and the associated Pacific Trails pipeline.

These include filing a Marine Mammal Protection Plan and answer how KM LNG  would react to any potential effects on marine mammals of the ships passing up and down Douglas Channel and the BC Coast. 

One of the lawyers for the energy companies wondered why the board panel was interested in the shipping issues.”That’s what shps do, they use
existing shipping lanes,” he said. “Ships do not need permisson [now] to go up
Douglas Channel.  [This issue] has been examined bythe appropraite
authorites arnd should be accepted by the board without conditions.”

Other conditions wanted reports on potential effects and probable mitigation efforts for marine mammals, birds, fish and fish habitat, “listed fish and wildlife species,” vessel wake, ballast and bilge water management, fisheries and “First Nations traditional use activities.”

The lawyers mainly objected on legal grounds, since under the hearings for an export licence, (unlike a facility hearing like the Enbridge Joint Review panel)  the board is not supposed to be concerned about environmental issues.  There were also long, legal arguments whether the pipelines from the shale gas fields to Kitimat where “directly connected” under the legal definition used in the Canadian energy industry. The lawyers also argued that the environmental and social issues addressed in the NEB’s proposed conditions would be covered in parallel investigations by other government agencies, such as a Transport Canada review of the shipping plans for Douglas Channel,

At the same time, all parties pledged that they would be “good corporate citizens” in their undertakings to work with the Haisla First Nation and other residents of the Kitimat region and to respect the local environment.

NEB proposed conditions 1 – 9

A33_-_Letter_to_All_Parties_Phase_II_Update_and_Possible_Licence_Conditions_-_A2A2V5.pdf

NEB proposed conditions 10 – 12

A34_-_Letter_-_Possible_Export_Licence_Conditions-Environment_and_Socio-Economic_Matters_-_A2A3T7_.pdf