Clio Bay Editorial:Hire the experts. This is not the time to be learning on the job

Special report: Clio Bay cleanup: Controversial, complicated and costly

Editorial:

Hire the experts. This is not the time to be learning on the job.

Everyone in the Kitimat and Kitamaat Village are facing a dilemma, a dilemma that should have been solved a year ago, when it was first known that the KM LNG project at Bish Cove had grossly underestimated the amount of marine clay and other material that has to be removed for the liquified natural gas terminal, a total of about 3.5 million metric tonnes.

The Haisla and Chevron are proposing that much of the clay be deposited over sunken logs in Clio Bay.

Chevron, which only took over operations at KM LNG in December 2012, is still learning on the job.

When the Clio Bay capping plan became public, far too late in the process, only then did Chevron begin to take a serious look public worries about the environmental problems that might result from depositing all that marine clay in Clio Bay.

Chevron hired Stantec, a well-known international  consulting firm with close ties to the energy industry and some experience in remediation to evaluate Clio Bay. Although Chevron said in a statement that Stantec is a company  “with extensive experience in many major habitat restoration projects,” it appears that Stantec, in the case of Clio Bay, is a jack of all environmental trades and master of none, just learning on the job.

In answer to questions by Northwest Coast Energy News, Chevron cited two studies supplied to them by Stantec. One was Chris Picard’s (now with the Gitga’at First Nation) study of Clio Bay which anyone can find by using a Google Search. The second was an overview chapter of west coast North American logging practices from a book published 22 years ago.

Any of the web saavy undergraduate journalism students I once taught at Ryerson University could have done better. This semi-retired reporter, without the resources he once had in a major newsroom, easily found the studies of the log filled Ward Cove, the State of Alaska’s recommended remediation practices, the capping procedures recommended by the US Army Corps of Engineers and more. Chevron did not mention Stantec citing the 1995 DFO study of nearby Minette Bay which can easily be found on the DFO website.

A letter from Fisheries and Oceans to District of Kitimat Council only mentions Dungeness crab and not the Haisla desire to restore halibut and cod to Clio Bay. That can only raise suspicions that the DFO is also depending solely on Chris Picard’s limited survey of Clio Bay.

In Alaska, at Ward Cove, there were almost five years of studies on the ocean environment before part of the cove was dredged and parts of the cove with thousands of logs there were capped with fine sand.

The people of Kitimat and Kitamaat want the LNG project to proceed. Everyone wants a clean and sustainable ocean enviroment, whether in Clio Bay, Minette Bay or down Douglas Channel. The problem of that 3.5 million cubic metres of marine clay must be handled in a timely fashion so the LNG terminal can move to the next step in the coming months. There is no time for five years of studies before proceeding.

This site would not normally endorse one large corporation over another.

There isn’t time for Chevron and Stantec to be learning on the job, its technicians racing in their boats between Clio Bay and Bish Cove trying to figure out what is going on and casually asking people what they think. No time at all.

The clock is ticking. Chevron and Apache, in partnership with both the Haisla and the District of Kitimat, should immediately hire the companies that do have the expertise in remediating a northwest Pacific coast bay filled with sunken logs, the companies that cleaned up Ward Cove in Alaska. Integral Consulting was the main environmental consulting contractor at Ward Cove, assisted by another large firm, Exponent  and by Germano and Associates, a company that  according to its website specializes in “rapid seafloor reconnaissance”. Both Integral and Exponent are, like Stantec, giant international consulting firms.  In this case, experience has to count. While Stantec’s website does list remediation projects, none are similar to Clio Bay.

A letter from Fisheries and Oceans to the District of Kitimat says that:

Chevron will be required to conduct a pre-construction, construction and post construction monitoring program. Pre-construction monitoring will include collection of baseline information that will be used to assess effectiveness monitoring during and at the completion of the project. Water quality monitoring for turbidity and total suspended solids will be undertaken during construction to determine if established performance criteria are met.

From the reports available from both the EPA and the State of Alaska it appears that the companies that cleaned up Ward Cove did just what DFO is asking, assess and monitor.  Another reason to hire the experts rather than the newbies.

Why a three way partnership? Chevron/Apache and the Haisla Nation are already partners in the Clio Bay plan. Adding the District of Kitimat would establish trust and make sure that the results of any scientific and engineering studies, plans and operations would be available to the people of Kitimat (as well as some Haisla members who feel they were excluded) as part of the ongoing process. The partnership would make up for the lack of transparency up until now, make sure the public is kept up-to-date and not just by Chevron’s and DFO’s communications people since reports to the District could be reviewed by the engineering staff and members of council.

It is likely that those companies that worked at Ward Cove could quickly let everyone know whether the idea of capping at Clio Bay with marine clay is a viable option and if it is viable how to do it properly rather than just dumping the clay from a barge using a hose. If marine clay is not viable for Clio Bay, it is likely that those firms could advise whether one of the original plans, to dump the clay in the deep ocean, is a better solution, or if there is another alternative that no one has thought of.

Kitimat and Kitamaat are lucky. The recommended practice for capping sunken logs is using sand. There is here a ready source at the Kitimat Sand Hill. If marine clay is not a viable option, or for future projects, the Sand Hill can easily be used to fulfill the aims of both the Haisla Nation and the residents of Kitimat to clean up Clio Bay, Minette Bay and eventually all 50 other sites identified along Douglas Channel by DFO in 1997. Those consulting firms have the expertise in this area and that expertise should be utilized.

Learning from the job

Even though sand has a track a record in capping, using marine clay from Bish Cove  to cap the logs at Clio Bay is probably a good idea, after all that marine clay was once at the bottom of the Ice Age Douglas Channel.

The use of sand for capping sites is well-known, there are established engineering parameters. At Ward Cove, there were studies of the angle of the slopes and how much weight of sand that the debris could hold.  Sand is very different from marine clay. At the moment, there are no engineering parameters for marine clay. It appears that no one has thought of doing slope analysis and load bearing engineering studies at Clio Bay.

Marine clay is a potential cap for all the sunken log sites on Douglas Channel and on the whole Pacific coast from Oregon to Alaska.  That means that Clio Bay is a pilot project that should be planned as carefully as possible, within the time constraints needed for construction of the LNG terminal, but not regarded as a rush job to get rid of that clay.  That means taking the time needed to do all the necessary scientific and engineering studies before the first drop of clay heads to the bottom. That is another reason to hire experts who actually know what they are doing so everyone can learn from the job.

 

Standards

No matter how the cleanup of Clio Bay proceeds, KM LNG, the Haisla and the District of Kitimat are facing another dilemma. What standards and benchmarks should be applied to the project?

By law, the Department of Fisheries and Oceans is responsible and will, of course, be monitoring the cleanup.

Despite assurances in a letter to the District of Kitimat, it is clear that DFO too is learning on the job.

At the moment, DFO has no standards for remediation, because the Conservative omnibus bills have gutted environmental standards in Canada. Even before the omnibus bills and the LNG rush, cleaning up log dumps was on the DFO low low priority list.

The letter from DFO to District of Kitimat council shows what knowledgeable sources have told us, DFO will be navigating Clio Bay from a desk in Kamloops (of all places). The same sources say that the Prince Rupert office of DFO, which has the expertise on the northwest coast is out of the loop on this project. The residents of the northwest coast already know there are not enough fisheries officers to properly monitor the coast. DFO “estimates” the annual recreational halibut catch (perhaps by using fish entrails rather than the traditional chicken?). DFO has retired or laid off many scientists who have studied the coast. Others have left on their own. The remaining scientists are muzzled by the Harper government, with anything they could say filtered by the Prime Minister’s Office, so it is likely that no one in the northwest will actually trust what they say.

Normally in a free and democratic society, the government tells local residents when a major operation like the remediation of Clio Bay is going to occur.  In this case, Fisheries and Oceans did not tell anyone in Kitimat anything until the District of Kitimat Council requested information.

On Monday, Sept. 30, a representative of Chevron will make a presentation to District Council. DFO did nothing more than send a letter that said: “Regretfully, Fisheries and Oceans Canada is unable to attend the scheduled council meeting.” Nobody, in the whole department? One is tempted to say, “That’s not good enough.” Then you remember that if DFO appeared before Council, the presenter would have to face possibly awkward questions from both members of Council and the media. That just doesn’t happen in Stephen Harper’s Canada, not in Ottawa and certainly not in Kitimat.

Despite what DFO has said in its letter, this regulatory vacuum leaves the Kitimat region no choice. Since Canada has no standards, when the Clio Bay project proceeds, the best available standards are those set by Alaska, which has the same type of coast and climate. The Clio Bay clean up should therefore be measured against those Alaska standards.
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Clio Bay: Links and Documents

Links and documents relating to sunken logs and site remediation

Note many, not all, external links are to pdf files.

Canada

DFO study of sunken log sites in Douglas Channel

DFO Study Dissolved oxygen cycle in Minette Bay

Impact of Wood debris in British Columbia estuaries

Chris Picard’s study of Clio and Eagle Bays as posted on the University of Laval website

United States

Links

Alaska Department of Environmental Conservation

Environmental Protection Agency

Ketchikan Paper Company
This is the EPA Web site on the Ward Cove cleanup and remediation with numerous documents.

EPA capping guidance
EPA contaminated sediment capping guidance

US Army Corps of Engineers

US Army Corps of Engineers capping guidance

Documents

Alaska log site remediation guide  (pdf)

EPA study of dissolved oxygen in Ward Cove (pdf)

Marine Log Transfer Facilities and Wood Waste (pdf)

Academic paper by Ward Cove consultants Geramano & Associates on sediments in Ward Cove and Thorne  Bay, Alaska.

Ward Cove Sediment Remediation Project Revisited

Academic paper by Ward Cove consultants Integral Consulting

 


 Other Links

Kitimat LNG (KM LNG)

Stantec

Stantec remediation project page

Integral Consulting

Integral Consulting Ward Cove web page

Exponent 

Exponent Ward Cove web page

Exponent LNG Safety web page

Germano & Associates

(Note not all documents used in this report are available online. Some sent to NWCEN are too large to upload)

 


 
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Chevron announces open house on Clio Bay, seeks input from stakeholders

Updates with open house location

Chevron LogoChevron, the partner with Apache in the KM LNG (also known as Kitimat LNG) project at Bish Cove, said Sunday that the company will hold an open house in Kitimat on the controversial Clio Bay reclamation project.

Chevron says there will be a public open house at Riverlodge Tuesday, October 8 from 4 pm to 8 pm.

In an e-mail to politicians and local groups, including Douglas Channel Watch, Marc Douglas, a senior advisor for Chevron, based in Calgary, invited local stakeholders for a series of one hour meetings the same day at the KM LNG offices in City Centre.

Chevron Canada invites you to a meeting to discuss the Clio Bay Marine Life Restoration Project.
This proposed project would see Chevron excavate marine clay from the Kitimat LNG construction site at Bish Cove and work closely with the Federal Department of Fisheries and Oceans to deposit this natural material in specific locations in Clio Bay. The clay will cap-off decaying wood debris left by historic log booming operations that has accumulated on the bottom of Clio Bay, damaging the Bay’s natural ecosystem. A key goal of the project is to restore natural marine life populations in Clio Bay. Come and share your thoughts and ideas with us and learn more about this innovative restoration project.

 

Ad for open houseThere has been growing controversy over the Clio Bay project in recent weeks. Members of the Haisla Nation and residents of Kitimat were initially told that due to the large number of sunken logs at Clio Bay, that the area was deprived of oxygen, with limited sealife and that capping the logs with clay from Bish Cove would restore the ecosystem. However, beginning with a discussion at District of Kitimat Council on September 3, more people have been challenging the idea that Clio Bay needs restoration, with fishers posting photographs of recent catches on Facebook pages.

On Sept.3, Councillor Phil Germuth told Council:  “Those logs have actually created a woody reef, where like any other reef, an ecosystem is being sustained. So to say that those logs are suffocating the life out of Clio Bay doesn’t seem to have a lot of merit.”

At the time, Chevron told the media  that they had consulted with the Department of Fisheries and Oceans and  concluded that carefully placed clay would improve the ecosystem.

Special report: Clio Bay cleanup: Controversial, complicated and costly

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Apache sells some of its gas and oil assets, confirms commitment to Kitimat project

Apache CorporationApache Corporation said Thursday it will  sell oil and gas producing properties in the Nevis, North Grant Lands and South Grant Lands areas of western Alberta, to Ember Resources Inc., a private Canadian company, for CAN$220 million, as part of the company’s “portfolio rebalancing,” Apache said in a news release.

At the same time, Apache CEO Rodney Eichler said,  “We also remain focused on advancing the Kitimat LNG project to monetize large unconventional resources in the Liard and Horn River basins in northern British Columbia.”

“Going forward, Apache is focused on growing our liquids production from a deep inventory of crude oil- and liquids-rich opportunities that generate attractive rates of return on our extensive remaining acreage in Canada’s Western Sedimentary Basin,”  Eichler said.

“This transaction is one element of a comprehensive review of Apache’s portfolio to determine which assets make the most sense for Apache to own given our growth and return objectives and which assets are better owned by others,” Eichler said. “The Nevis, North Grant Lands and South Grant Lands assets fit in the latter category.”

Apache is selling 621,000 gross acres (530,000 net acres) and more than 2,700 wells that had average net production during the second quarter of 2013 of 67 million cubic feet of gas and 237 barrels of liquid hydrocarbons per day from late Cretaceous sands and coal seams. Apache says “it  will retain 100 per cent working interest in horizons below the Cretaceous, such as potential Duvernay and Nisku, in Nevis and North Grant Lands.”

Apache previously announced plans to divest $4 billion in assets by  the end of 2013. The company intends to use proceeds from the asset divestitures to reduce debt and enhance financial flexibility and to repurchase Apache common shares under a 30-million-share repurchase program authorized by the Board of Directors earlier this year.

In July, Apache announced an agreement to sell its Gulf of Mexico Shelf operations and properties to Fieldwood Energy LLC(Fieldwood), an affiliate of Riverstone Holdings, for cash proceeds of $3.75 billion. In addition, Fieldwood will assume all asset retirement obligations for these properties, which, as of June 30, 2013, Apache estimated at a discounted value of approximately $1.5 billion.

 

Chevron postpones Kitimat LNG decision to 2014, seeks new equity partners, Dow Jones reports

The Dow Jones wire is reporting that Chevron has postponed a final investment decision on the Kitimat LNG project until 2014, “putting a deadline on a project that has already seen delays.”

Competitors are trying to sell natural gas to Asian customers using the cheaper Henry Hub North American market  benchmark rather than higher Japanese bench mark which is based on the price of oil. 

The Dow Jones report says Chevron, which is partnered with Apache, is still having problems finding customers in Asia.  It quotes George Kirkland, head of Chevron’s upstream business, as saying that the company is offering customers equity stakes in the Kitimat project. Kirkland told a conference call that equity should be more attractive to buyers.

Kirkland said the company won’t approve the project until it has lined up customers for at least 60 per cent of Kitimat’s total 5 million metric tons a year of export capacity, although Kirkland expects that to happen in 2014.

“We’ve have had some discussions with Asian buyers,” Mr. Kirkland said during a call with investors. He declined to name the companies with which Chevron was negotiating. “It’s more likely to be a 2014 (decision), not late 2013,” he said.

U.S. natural gas prices were $3.37 per million British thermal units Friday, down from $13.69 in July 2008.
Chevron to Make Final Kitimat LNG Decision in 2014

Kitimat approves building permit for KM LNG construction camp

 

Ron Link of KM LNG addresses District of Kitimat Council on a building permit for the work camp. (Robin Rowland)
Ron Link of KM LNG addresses District of Kitimat Council on a building permit for the work camp. (Robin Rowland)

District of Kitimat Council tonight (March 4, 2013) approved building permits for the KMLNG work camp at the old West Fraser Eurocan paper mill site.

The first phase of the camp, called 1A will have 155 beds, followed by a second camp, called 1B with 145 beds. Council also approved a second phase, Camp 2, which will have an additional 300 beds. The camp will consist of single-storey, 44 bed dormitories, similar to those now being used at the Rio Tinto Alcan Kitimat Modernization project, a couple of kilometres away.

“This camp will support the construction of the LNG terminal,” KM LNG’s Ron Link told council, “the focus right now is a 600 man camp. Beyond that, if the final investment decision is approved, it will eventually grow to 2,800.

To build the camp KMLNG will have to demolish some of the remaining blow pipes and chip screening facilites that are there.

“Under the regulations it is a contaminated site and we have a company called Constega Rovers that are participating in sampling the site. It is certainly our attention to clean it up.

If the full 2,800 bed camp is built, the remaining part of the facility will be directly west of the current proposed campsite.

Later in the meeting council continued to debate the contenious issue of an over all camp policy for the District of Kitimat and voted to instruct district staff to “bring back a calendar with the process and dates for discussing camp policy.”

Staff would prepare a document indicating where camps are presently permitted within the District of Kitimat followd by a committee of the whole meeting dedicated to the pros and cons of camps within the district and perferred locations, services provided by the district and size limits.

There will likely be both a public town hall and a “public meeting” of council to discussion the issues later in the spring,

The debate was prompted bya proposal from the PTI Group to build a large “lodge style” work camp within the boundaries of the residential part of Kitimat, near the hospital and City Centre Mall. The PTI proposal would require amendments to both zoning and the Official City Plan. The KMLNG and RTA camps are in areas zoned for industrial use and would not be affected by a change to the official plan for the residential area.

Haisla, Ottawa and BC sign agreement to open way for Kitimat LNG developments

Haisla NationThe Haisla Nation, the federal government and the province of British Columbia have signed an agreement that opens the way for liquified natural gas development on Haisla territory on Douglas Channel.

The federal government also announced new regulations under the the First Nations Commercial and Industrial Development Act (FNCIDA). The regulations are necessary because First Nations are still governed by provisions of the century old Indian Act and reserve land is outside of provincial jurisdiction.

The agreement was announced at a news conference in Vancouver today, January 22, 2013. At this point it mainly concerns the Kitimat LNG project (also known as KM LNG)

A news release from the federal department of Aboriginal Affairs and Northern Development says: “FNCIDA was a First Nations-led initiative that allows the government to work with First Nations and provincial regulatory authorities to create regulations for complex commercial and industrial development projects on reserve.”

The tripartite agreement with the Government of Canada, Government of British Columbia and Haisla Nation “ensures administrative, monitoring and compliance activities for the LNG facility are performed and enforced by provincial officials.”

The news release also quotes Haisla Chief Counsellor Ellis Ross as saying: “Kitimat LNG offers new, important and sustainable economic opportunities which the Haisla people are eager to embrace. We have seen new jobs, business opportunities, and skills training come to our people since KM LNG signed its agreement with us, and we know that the agreement signed today with Canada and BC is a milestone in making the project a reality. On behalf of the 1,700 Haisla people, I thank both governments for their commitment to this important agreement and the better future it is bringing our people.”

The federal news release goes on to  quote BC Community, Sport and Cultural Development Minister Bill Bennett as saying: “The BC Government is working with industry and First Nations to foster economic growth through the expansion of our province’s natural gas sector. I would like to thank the Government of Canada and the Haisla Nation for working with us to move the Kitimat LNG facility another step forward.”

The federal release also quotes executives from both major companies involved in the Kitimat LNG project, Apache and Chevron. Chevron recently took over operating control of the project from Apache when that company had difficulty finding customers in Asia for the LNG.

The Government of Canada, Government of BC and the Haisla Nation have shown exceptional leadership and support towards BC’s new LNG industry” said Tim Wall, President of Apache Canada. “This regulatory agreement builds on the many other agreements with the Haisla that has led to jobs, training, education and economic development in Kitimaat Village.”

“I want to congratulate the Haisla First Nation, the Governments of Canada and British Columbia, and Apache Canada for their shared leadership in finalizing the regulations governing the Kitimat LNG facility site,” said Jeff Lehrmann, president, Chevron Canada Limited. “We look forward to working with the Haisla First Nation, both governments, other First Nations and local communities to realize the project’s long-term economic potential.”

In remarks prepared for the meeting Canada’s Aboriginal Affairs minister John Duncan was quoted as saying

The proposed project will provide Canada’s energy producers with a doorway to overseas markets, in addition to creating jobs and economic development opportunities not just for the Haisla First Nation, but the entire northwest region of British Columbia.
That’s good news for members of the Haisla Nation, good news for British Columbia, and good news for all Canadians.
These regulations are passed under the First Nations Commercial and Industrial Development Act, known as FNCIDA, which allows the federal government to develop regulations for complex commercial and industrial development projects on reserve in partnership with First Nations and Provincial governments.
For First Nations, FNCIDA can remove the barriers they face in pursuit of economic development opportunities, while providing the certainty investors require, and assuring the community that the necessary oversight measures are in place.
Together with the Province of British Columbia and the Haisla Nation, the Government of Canada has also signed an agreement which ensures administrative, monitoring and compliance activities for the facility are performed and enforced by provincial officials who have the necessary experience and expertise.
As a result, the regulatory pieces are now in place for project to proceed.

Duncan added:

To protect the environment as it relates to natural gas production, together with the Province of British Columbia we have completed an environmental assessment pursuant to the Canadian Environmental Assessment Act. With our partners, we will ensure that the LNG plant is designed and built to industrial safety standards and that the operation is properly regulated

Related: First Nations Commercial and Industrial Development Act 

Apache delays Kitimat decision again, Wall Street Journal reports

The Wall Street Journal (subscription required) is reporting that Apache has once again delayed its decision whether or not to go ahead with the Kitimat LNG project.

So far there is no news release on the Apache site and no other media has matched the Wall Street Journal story.

Analysts are blaming the decision on the recent move by some players in the energy industry to sell natural gas to Asia at low  North American prices, rather than the world price, which is determined as a percentage of the price of oil.   A move by Asian countries to buy LNG at the lower North American market price would undercut the profitability of any LNG export project through Kitimat.

 

 

 

Kitimat LNG progressing–or is it?

At the District of Kitimat Council meeting on Monday, October 1, as part of Mayor Joanne Monaghan’s regular “good news” briefing, she told council that the Kitimat LNG  project continues to “progress positively.”  The news from Calgary on Tuesday, however, was not as promising.

Both Bloomberg News and the Calgary Herald reported that  Apache, which owns 40 per cent of the KM LNG partnership is worried about a recent decision by a rival gas company to sell natural gas to world markets at low North American prices rather than, as been customary up until now, as percentage of the world oil price. That differential gives the North American gas companies a profit in Asia and it is that profit difference that makes Kitimat attractive for LNG projects.

At the council meeting, Monaghan reported, quoting Apache’s  Apache’s Manager of Public and Government Affairs Natalie Poole-Moffatt, as saying that  Kitimat LNG will be opening a full time community office in downtown Kitimat near the City Centre mall in the near future.  Apache says renovations are nearly complete and they will be holding an open house in the near future.

Monaghan said that work on the Kitimat LNG site at Bish Cove continues with blasting to create proper elevation, crushing and sorting of rock and constructing an access route to the forest service road. This summer work began on the two year $25 million upgrades to the old forest service road “which will improve conditions on the road.”

However, in Calgary, the Herald quoted KM LNG vice-president David Calvert as saying “things are going so well that it has been decided to risk spending on clearing ground before completion of the front end engineering and development study and final investment decision.”

But according to several media reports,  Calvert told an Energy Roundtable in Calgary on Tuesday that a final go-ahead for Kitimat LNG is not a done deal. the Herald quoted Calvert as saying: “We remain convinced that oil-linked pricing is critical to the viability of our Canadian LNG industry.”

Bloomberg reported that a recent deal by Cheniere Energy Inc. to sell liquefied natural gas based on North American pricing (also known as Henry Hub pricing) means that it is difficult for Apache to find Asian customers to sign the long term LNG contracts needed to make the Kitimat project viable. (Asian LNG prices are based on the “Japan Customs Cleared Price” set by the Japanese government as a percentage of the price of crude oil).

Bloomberg quoted Calvert as saying: “It created quite a ripple through the marketplace,” and Bloomberg said, the Cheniere deal has created “unrealistic expectations.”

Related

Globe and Mail

Canadian gas producers dreaming big – again 

Canada losing the race to sell LNG

Updated

The Haynesville Shale

Cheniere Deal Hurts Canadian LNG Project

Cheniere is less sensitive to prices given its role as a middleman, while Apache, Encana and EOG are producers, for whom the price is very important.  One advantage of Kitimat is its west coast location, but that is only a minor cost advantage over Gulf Coast facilities.

The clock is ticking on Kitimat.  It sounds like Asian buyers are sitting on the sidelines waiting for lower prices.  Right now the U.S. government is sitting on future LNG approvals pending the release of a study around year-end.  If the U.S. approves the pending applications, a proverbial flood of LNG will come to market with Henry Hub-based pricing.  At that point Kitimat’s owners will be in a tough spot.  Kitimat is vital to B.C., but the economics might not work.

Wall Street Journal

Cheniere Lights a Match in the Gas Market

 

Minor oil leak at Bish Cove

In a report to District of Kitimat Council, Apache’s Manager of Public and Government Affairs,  Natalie Poole-Moffatt,  also reported that on September 19, an oil leak was spotted on a piece of heavy equipment at Bish Cove.  The report says;

WestCoast Marine was notified and booms were deployed as a preemptive measure in Bish Cove, no machine oil has migrated to Bish Cove. Environmental crews are on site executing a remediation plan.  Both the [BC] Provincial Emergency PLan (PEP) and Aboriginal and Northern Affairs Canada  were notified of the incident.

The piece of equipment  is currently being repaired and will undergo operational tests to ensure  the equipment can function without further concern.  Environmental staff will remain on the site 24/7 until remediation is complete.

TransCanada to build Shell’s “Coastal Gaslink” natural gas pipeline to Kitimat

Trans Canada logoShell Canada and its Asian partners have chosen TransCanada Corporation to design, build, own and operate the proposed natural gas pipline to Kitimat, now called the Coastal GasLink project.

The estimated $4-billion pipeline will transport natural gas from the Montney gas-producing region near Dawson Creek, in northeastern British Columbia to the proposed natural gas export facility at Kitimat, BC.

The LNG Canada project is a joint venture led by Shell, with partners Korea Gas Corporation, Mitsubishi Corporation and PetroChina Company Limited.

A news release from TransCanada says “Shell and TransCanada are working toward the execution of definitive agreements on the Coastal GasLink project.”

In the release, Russ Girling, TransCanada president and CEO says:

Our team has the expertise to design, build and safely operate pipeline systems. We look forward to having open and meaningful discussions with Aboriginal communities and key stakeholder groups, including local residents, elected officials and the Government of British Columbia, where we will listen to feedback, build on the positive and seek to address any potential concerns. Coastal GasLink will add value to British Columbians, particularly Aboriginals and communities along the conceptual route, by creating real jobs, making direct investments in communities during construction and providing economic value for years to come.

TransCanada says the company has approximately 24,000 kilometres of pipelines in operation in western Canada including 240 kilometres of pipelines in service in northeast BC. Another 125 kilometres of proposed additions either already having received regulatory approval or currently undergoing regulatory review. These pipelines form an integral and growing part of TransCanada’s NOVA Gas Transmission Ltd. (NGTL) System, which brings natural gas from Alberta to British Columbia to a hub near Vanderhoof.

Girling said in the release:

TransCanada is a leading energy infrastructure company in North America, with a 60-year history of safe, efficient and reliable operation of our assets and a respect for the communities and environments where we operate. We appreciate the confidence that Shell and its partners have placed in us to build, own and operate this natural gas pipeline in British Columbia. We will work collaboratively with them, Aboriginals and other stakeholders as we launch into the initial phases of consultation and regulatory review.

LNG Canada logo

Project parameters

 

In it’s release TransCanada describes the potential Coastal GasLink pipeline project this way:

  • Receipt point: Near Dawson Creek, BC
  • Delivery point: Proposed LNG Canada facility near Kitimat, BC
  • Product: Natural gas from BC’s abundant Montney, Horn River and Cordova basins and elsewhere from the Western Canada Sedimentary Basin
  • Length of route: Approximately 700 kilometres of large diameter pipe
  • Initial pipeline capacity: In excess of 1.7 billion cubic feet of gas per day
  • Anticipated jobs: Estimated 2000-2500 direct construction jobs over a 2- during construction 3 year construction period
    Estimated cost: Detailed cost information will be developed following completion of project scoping and planning. The current estimate is approximately $4 billion
  • Regulatory process: Applications for required regulatory approvals are expected to be made through applicable BC provincial and Canadian federal processes
  • Estimated in-service date: Toward the end of the decade, subject to regulatory and corporate approvals

Pipeline route

TransCanada says: “The final pipeline route will take into consideration Aboriginal and stakeholder input, the environment, archaeological and cultural values, land use compatibility, safety, constructability and economics.:

Pacific Trails Pipeline
The Pacific Trails Pipeline would go cross country to Kitimat. (PTP)

At this point there are two possible routes for the pipeline west of Vanderhoof. One route would be to follow the existing Pacific Northern Gas route that roughly parallels Highway 16. The second possibility is a cross-country route, which may lead to controversy. The Pacific Trails Pipeline, which would feed the KM LNG partners (Apache, Encana and EOG) goes across the mountains from Smithers. While the PTP project has the approval of most First Nations in the regions, Apache and PTP are still in negotiations with some Wet’suwet’en houses over portions where the pipeline would cross the traditional territory of the houses. The much more controversial Enbridge Northern Gateway pipeline follows a similar cross-country route and faces much stiffer opposition than the Pacific Trails Pipeline, due to the content of that pipeline, mainly diluted bitumen and because, critics say, Pacific Trails managed to secure the most geologically stable cross country route earlier in this decade when the pipeline was originally planned to import, not export, natural gas.

TransCanada says the Coast Gaslink pipeline will also have an interconnection with the existing Nova Gas (NGTL System and the liquid NIT) trading hub operated by TransCanada.  The company says:

A proposed contractual extension of TransCanada’s NGTL System using capacity on the Coastal GasLink pipeline, to a point near the community of Vanderhoof, BC, will allow NGTL to offer delivery service to its shippers interested in gas transmission service to interconnecting natural gas pipelines serving the West Coast. NGTL expects to elicit interest in and commitments for such service through an open season process in late 2012.

That means that the Asian customers will not be just dependent on natural gas from northeast British Columbia.  Instead the “molecules” of natural gas from Alberta will join the stream heading to Kitimat. “Open season” in the energy industry is an auction where potential customers or transporters bid for use the pipeline.

In the release Girling says:

The potential Coastal GasLink pipeline project will allow British Columbians, and all Canadians, to benefit from the responsible development of valuable natural gas resources and will provide access to new markets for that gas. The project will also create substantial employment opportunities for local, skilled labourers and businesses as part of our construction team,” concluded Girling. “We know the value and benefits that strong relationships in British Columbia can bring to this project and we look forward to deepening those ties as our extensive pipeline network grows to meet market and customer needs.

TransCanada Corp. is no stranger to controversy, the company is the main proponent of the Keystone XL pipeline from Alberta to the US Gulf Coast. Portions of that pipeline were put on hold by President Barack Obama pending further review and Keystone has become a hot issue in the current American presidential election.