Northwest Coast News

Three pipeline builders race to reach new markets Keystone, TMX and Gateway: Alberta Oil

Alberta Oil 

Pipelines have never been so popular. For years, the steel conduits followed unseen routes. They carried rivers of crude oil beneath city and town alike, rarely drawing so much as a passing thought from those who depended on their valuable cargo. Today, proposals by Kinder Morgan Canada, Enbridge Inc. and TransCanada Corp. face fierce opposition in a bid to carry more Canadian crude oil – chiefly increased oil sands production – to new markets.

Excerpt from Alberta Oil interview with Nlorthern Gateway President John Carruthers

 

The primary markets where we would see the most value are China, Japan, South Korea and Taiwan. Now once the oil reaches tidewater it can access any market. We would see crude going periodically to different markets. But those four markets in particular have strong demand. The proximity of Canada to those markets and the fact that they can process Canadian crude is all very positive. Potentially the oil could also go to California.

Enbridge refines sales pitch: Terrace Standard

Terrace Standard 

Enbridge officials are sharpening their sales pitch for the company’s planned Northern Gateway oil pipeline project, saying it will bring jobs, provide an economic boost and help wean the country from an overdependence on the United States of America. 

 Andrew Popko, one of three Enbridge officials on a tour of the area last week, said Canada deserved to get world prices for its products.

“Our most valuable asset is oil from northern Alberta,” he said.

Enbridge, Veresen, Williams to acquire condensate plant, pipeline from EOG: CP

Canadian Press


Enbridge, Veresen, Williams to acquire condensate plant, pipeline from EOG

Three North American pipeline companies including Calgary-based Enbridge Inc. (TSX:ENB) are buying a natural gas processing plant and pipeline in the U.S. Midwest from EOG Resources, Inc. (NYSE:EOG) for US$185 million.

The Stanley Condensate Recovery plant and Prairie Rose pipeline connect to the Alliance gas pipeline, which is owned 50-50 by Enbridge and Veresen Inc. (TSX: VSN), and will supply a Chicago-area processing plant operated by the partners.

Malaysia buys stake in BC shale, eyes West Coast LNG export terminal

A Canadian energy company, Progress Energy Resources, based in Calgary, has agreed to sell 50 per cent its stake in  a BC shale gas development called North Montney to Malaysia’s state oil firm Petronas  for $1.07 billion Canadian ($1.09 billion US). The two plan to build  an LNG export terminal somewhere on the BC West Coast for the export of liguified natural gas to Malaysia and possibly other parts of Asia.

The Progress news release says:

Petronas and Progress will 
establish an LNG export joint venture (the “LNG Export Joint Venture”) 
to be 80 per cent  [by Petronas] and 20 per cent owned [by Progress], respectively. The LNG Export
 Joint Venture will launch a feasibility study to evaluate building and
operating a new LNG export facility on the West Coast of British
Columbia. Petronas would be the operator of this facility, and Petronas 
and Progress would jointly market the LNG utilizing Petronas’
well-established and extensive network of customers in the largest LNG
markets globally.

 No location was mentioned for the proposed LNG terminal.

In the news release Michael Culbert, President and Chief Executive Officer of Progress was quoted as saying:

“We look forward to working with West Coast British Columbia communities as we pursue this opportunity to build a new facility that will add value to British Columbia’s natural resourceswhile creating considerable long-term local economic benefits.”

Culbert also said in the news release:

 

“This is a breakthrough transaction for Progress: the partnership we are
launching will enable us to accelerate our growth strategy….
”We are very pleased to form this long-term partnership with PETRONAS.
They share our belief that our North Montney shale assets are a
world-class resource that deserves significant investment.  We look 
forward to benefitting from PETRONAS’ significant global expertise
 including their leadership in developing infrastructure and accessing
 LNG markets. As well as enhancing Progress shareholder value, this 
partnership will also generate substantial economic benefits for local
communities and the province of British Columbia, while leveraging the 
environmental benefits of Canada’s abundant and clean-burning natural
 gas resources globally.

This is the first time that Petronas has entered the Canadian energy market, an indication of the growing scramble in Asia for BC oil shale and likely Alberta oil sands.  

Petronas, the national oil and gas company of Malaysia is one of the Fortune Global 500, with oil, gas and petrochemical interests in more than 30 countries. The company calls itself  one of the world’s leading LNG companies and is involved in all parts of the LNG business, from liquefaction and shipping to re-gasification and trading. As well as Malaysia, it has assets in Australia, Egypt and the United Kingdom.

For the public, Petronas is best known as the owner of the giant twin towers that dominate the skyline of Kuala Lumpur.

 Links

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Kinder Morgan proposes second Kitimat bitumen pipeline

In a story broken early Thursday, June 2, by the Vancouver website Tyee and confirmed by Northwest Coast Energy news,  another major energy player, Kinder  Morgan is proposing a second pipeline to carry bitumen from the Alberta oil sands to the port of Kitimat.

The proposal was part of a presentation to industry analysts  during a conference on March 24, 2011, with a PDF of the Power Point presentation posted on the Kinder Morgan Website.

The  likely controversial proposal was not picked up by the media until Tyee broke the story.

The presentation says the proposed pipeline is one of several alternatives proposed for the expansion of the existing Kinder Morgan Transmountain Pipeline.  In this scenario the pipeline to Kitimat would branch off from the Transmountain Pipeline go through Prince George and then apparently follow existing pipeline routes to Kitimat and not follow the proposed Enbridge Northern Gateway route.

379-kitimatmap.jpg

The Kinder Morgan presentation says the Transmountain pipeline branch to Kitimat would cost $4 billion, compared to the $5,5 billion that Enbridge has budgeted for the Northern Gateway project.  The Transmountain pipeline would have a capacity of  450 million  barrels a day compared  to the Northern Gateway capacity  of 550 million barrels a day.

Tyee says:

A power point presentation
for investors by Ian Anderson, president of Kinder Morgan Canada Group,
provides a wealth of information that has not been widely shared with
the general public or local governments:

Tyee says Kinder Morgan is also asking the National Energy Board for a immediate jump in the bitumen going through the port of Vancouver

They are also requesting to divert more Alberta crude and bitumen capacity to the Westbridge tanker terminal in Burrard Inlet and away from existing land-based refineries in B.C. and Washington. If approved, this would immediately expand crude capacity through Vancouver from 52,000 bpd to 79,000 bpd — an increase of more than 50 per cent

.

According to the documents seen by Tyee, the Vancouver end of the project would require the dredging of Second Narrows to allow large supertankers to visit the port. Tanker traffic in Vancouver would increase, Tyee says

Tanker transits through Vancouver will increase to 216 per year in 2016, up from 71 in 2010 and 22 in 2005.

All this is being propelled by increasing energy demand from China. It also appears that Kinder Morgan wants to increase the Vancouver capacity because of the delays in the Enbridge Northern Gateway project, which means that Alberta oil patch is seeking new ways to get the raw bitumen to China.

Links
Kinder Morgan Canada presentation on the Kitimat pipeline and the Vancouver port expansion (PDF)

Kinder Morgan application to the National Energy Board (PDF))

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Apache names new boss for Kitimat LNG project

Apache Corporation, of Houston, Texas,  the main backer of the Kitimat LNG development announced a management shakeup Tuesday, May 31, including  a new boss for the Kitimat project.

According to a news release issued by Apache, “Graham Lawton was named vice president –
liquefied natural gas (LNG) projects, leading the Kitimat project team
for the LNG facility and Pacific Trail Pipelines.”

Lawton is a new comer to Apache but has 30 years experience in the natural gas industry.
The news release describes Lawton  this way:

Lawton joined Apache in March 2011. He brings 30 years of experience in the gas industry – with 15 years in LNG projects – and has worked in the United Kingdom, United States, Tunisia, Singapore, Trinidad, India and Peru. Prior to joining Apache, Lawton was vice president of LNG at Hunt Oil Co. since 2005 and served as general manager of COLP, the operating company of Peru LNG. Previously, he was operations director at Marathon Oil Co. where he worked for Equatorial Guinea (EG) LNG. Prior to that, he spent more than 20 years with BG Group. Lawton is a fellow of the Institution of Gas Engineers and Managers, a fellow of the Institution of Mechanical Engineers, and a chartered engineer. Lawton received a bachelor’s degree in mechanical engineering from the University of Sheffield in England.

PR Newswire release Apache Announces Changes in Operational Leadership

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Kitimat LNG Project Granted Extension: 250 News

250 News


Kitimat LNG Project Granted Extension

The proponents of the liquefied natural gas terminal to be built near Kitimat now have more time to start up construction.
  

The Environmental Assessment Office has granted an extension to the Kitimat LNG Operating General Partnership’s environmental assessment certificate. Under the original certificate, substantial construction had to be underway on the LNG terminal by June 1st of this year.

The Kitimat LNG Operating Partnership must now have substantial construction started on the project prior to June 1ST of 2016.

Canada firms may miss Chinese market   Enbridge VP warns energy sector must act: Calgary Herald

Calgary Herald


Canada firms may miss Chinese market  Enbridge VP warns energy sector must act

If Canada’s energy firms don’t start exporting to China now, others might beat them to it, according to an Enbridge Inc. vice-president. 

 The warning by Byron Neiles, who heads up major projects for the Calgary-based company, was one of several made by industry voices to delegates at a national forum in Calgary on doing business with Hong Kong, hosted by the Hong Kong Canada Business Association. 

They argued the window of opportunity to sell to China won’t always be open largely due to competition and the chance the world’s second largest economy may cease growing at its current staggering pace – reducing the money its investors can spend.

Shell says it’s looking at B.C. Coast for new LNG terminal: Vancouver Sun

Vancouver Sun


Shell says it’s looking at B.C. Coast for new LNG terminal

Shell Canada says it is investigating the potential for a new liquid natural gas terminal to be located on the B.C. coast.

Shell “is interested in, and currently exploring LNG opportunities along the B.C. coast,” Stephen Doolan, of Shell’s media relations department said in an email to The Sun.
“We are early in the evaluation process so do not have specific details but are pursuing opportunities,” he said. “Natural gas is a key area of growth for Shell. In terms of LNG, we will continue to invest in our global leadership position as demand continues to grow

.

Tar Sands Express – Enbridge Northern Gateway Pipeline or the Railway? Watershed Sentinel

Watershed Sentinel

As billionaires invest in the railways and oil tanker traffic skyrockets along the BC coast, it looks as though the Enbridge Northern Gateway pipeline may have been a ruse all along  – a classic “bait and switch” – with a number of PR payoff ….

 By autumn 2008, CN Rail approached the Alberta government with its plan to move tar sands oil.  Alberta’s Energy Minister at the time, Mel Knight, told Dow Jones Newswire that CN and his government have had “very good meetings,” with CN believing that it could eventually transport 400,000 barrels per day from eastern Alberta to the West Coast of Canada. 

Just six months later, CN was estimating that it could transport 2.6 million barrels per day to the West Coast if 20,000 railcars were added to its fleet.
On April 15, 2009, the Financial Post’s Diane Francis reported that CN “will deliver the oil sands production through the use of insulated and heatable railcars or by reducing its viscosity by mixing it with condensates or diluents. The ‘scalability’ of the concept – up to millions of barrels per day – means that the railway can ramp up production cheaply and quickly to provide immediate cash flow to producers which otherwise will have to wait years for completion of upgraders and/or pipelines.