Map released by LNG Canada shows the air shed area that the company will study as part of the environmental assessment. (LNG Canada)
Two of the maps filed by the LNG Canada project with provincial and federal environmental assessment agencies look at the air quality problems from the project, including the controversial prospect of cumulative problems from multiple industrial projects in the Kitimat Valley, one of them the RTA Kitimat Modernization Project which will increase sulphur dioxide emissions while decreasing some other emissions.
One map covers what is being called the airshed, in the case of LNG Canada, air quality will be assessed with the LNG facility at its centre. A second map covers the tanker route, and as well as a 40 km square grid around the plant that will also assess Hartley Bay, Kitkatla and Metalkatia which may be impacted by vessel emissions.
As well as scientific data, the assessment will also take into consideration traditional knowledge and traditional use from “aboriginal and other groups.”
The possible cumulative effect on the air quality in the Kitimat valley and surrounding areas has prompted the BC government to commission its own study of the Kitimat airshed.
On Oct 3, the provincial ministries of the environment and gas development announced a $650,000 scientific study “to help inform regulatory and policy development for future industrial activity in the Kitimat area. The goal is to ensure the potential impacts from industrial air emissions are clearly understood prior to new projects being approved and in operation.”
It says
The Kitimat Airshed Impact Assessment Project will look at the cumulative effects of existing and proposed industrial air emissions in the airshed. These include emissions from: an existing aluminium smelter, three proposed LNG terminals, a proposed oil refinery, a crude-oil export facility, and gas-turbine-powered electrical generation facilities. The study will focus on sulphur dioxide and nitrogen dioxide emissions from these facilities.
The study will assess the impact of emissions through a number of scenarios, including their potential effects on water and soil, as well as on vegetation and human health from direct exposure.
An airshed is generally described as an area where the movement of air (and, therefore, air pollutants) can be hindered by local geographical features such as mountains, and by weather conditions. The most obvious example in British Columbia is a mountain valley. Since air pollution knows no political boundaries, airshed activities may be focused on a single community or on a number of neighbouring communities faced with similar air quality problems and requiring similar action.
The LNG Canada assessment will look at two potential adverse effects, first a change in ambient air quality in the Kitimat airshed or along the marine access route and second any change in acidic deposition pattern in the Kitimat Valley.
The first study will look specifically at estimated levels of “criteria air contaminets” including sulphur dioxide, Nitrogen oxides, carbon monoxide, atmospheric particulate matter and hydrogen sulphide. The particulate matter study will use the international standard of 2.5 micrometres.
The assessment will also study possible cumulative effects on air quality of multiple projects and those projects over time.
LNG Canada map shows the marine and land areas that will be studying for air quality. (LNG Canada)
The Northern Gateway Joint Review panel, Kenneth Bateman, Sheila Leggett and Hans Matthews, listen to final arguments in Terrace, June 17, 2013. (Robin Rowland/Northwest Coast Energy News)
Buried deep in the LNG Canada environmental assessment application, a reader will find a key difference in attitude with at least one of the group of companies planning liquified natural gas development in the northwest and Enbridge Northern Gateway.
It’s an earthshaking difference, since it’s all about earthquakes.
The documents filed by LNG Canada with the BC Environmental Assessment Office and the Canadian Environmental Assessment Agency acknowledge that there is a possibility of an earthquake (a one in 2,475 year event) at the LNG terminal site.
Northwestern British Columbia was shaken by two major earthquakes in the months before the Joint Review Panel concluded its hearings in Terrace. Both were far from Kitimat, but felt across the District. On October 27, 2012, there was a magnitude 7.8 earthquake on the Queen Charlotte Fault off Haida Gwaii. That quake triggered a tsunami warning, although the actual tsunami was generally limited to the coast of Haida Gwaii. Both landline and mobile phone service in Kitimat was briefly disrupted by both the quake and overloads on the system. Kitimat was also shaken by the 7.5 magnitude earthquake centered at Craig, Alaska a few weeks later on January 9, 2013.
With the exception of one vague reference in its final argument documents presented to the Joint Review Panel, Enbridge has stubbornly refused to consider any seismic risk to the region.
That was the company’s policy long before the October. 27, 2012 Haida Gwaii earthquake and was Enbridge policy after October 27, 2012.
In a public meeting in Kitimat on September 20, 2011, more than a year before the Haida Gwaii earthquake, John Carruthers, Northern Gateway president, insisted to skeptical questioners at a community forum at Mount Elizabeth Theatre that there was no earthquake danger to the proposed Northern Gateway pipeline and bitumen terminal in Kitimat. One of the questioners, Danny Nunes, of Kitimat, asked could the pipes withstand an earthquake? Carruthers repeated that Kitimat was not in an earthquake zone, that the fault was off Haida Gwaii and so would not affect Kitimat.
After the September, 2011 meeting, I asked Carruthers if Enbridge knew about the March 27,1964 “Good Friday” magnitude 9.2 Alaska earthquake that, because of its high magnitude, had caused major shaking in Kitimat. That earthquake destroyed much of Anchorage and triggered tsunamis that caused damage and death across Alaska and in parts of British Columbia, Oregon and California.
Carruthers promised to get back to me and never did.
On June 17, 2013, six months after the Craig, Alaska earthquake, in his opening summation before the Joint Review Panel, Richard Neufeld, lead lawyer for Northern Gateway, stayed on message track, telling the JRP, referring to pipelines: “The route is not seismically unstable. The seismic risk along the pipeline right-of-way is low, with only a few locations of moderate risk encountered, none of which are within the Haisla territory.”
That brought a gasp from spectators in the room, or at least those who had felt the October and January earthquakes.
The following day, June 18, Murray Minchin of Douglas Channel Watch found an anomaly in the Enbridge documentation, arguing in the group’s summation:
“The Proponent’s written final argument gets on shaky ground regarding design and construction of the storage tanks on a ridge beside Douglas Channel in paragraph 249 where they say:
“‘It also involves the safe construction and operation of the Kitimat terminal in Kitimat Arm in an area subject to seismic activity which encompasses both terrestrial and marine components.’
“Now, that’s interesting because isn’t that the first time — the first admission by the Proponent in a little over 10,000 pages of documents that the area they intend to build their project is in a seismically-active area?
“Haven’t they been telling us all along to this point that the only seismic concerns would be from the distant Queen Charlotte fault off of Haida Gwaii?
“Now, this completely contradicts Mr. Neufeld’s statement yesterday where he described the Project area as not “seismically unstable”. So what is it? This is their final argument and they’re contradicting themselves.”
Minchin went on to quote from the Enbridge argument: “’Seismic conditions in the project area have also been addressed.’
“Well, really? Is that a truthful statement, considering Natural Resources Canada has only submitted a preliminary report concerning a 50-kilometre fault line and massive submarine landslides they accidentally discovered last year in Douglas Channel while doing a modern survey of the Channel for navigation hazards.
“How can the Proponent claim to have adequately addressed seismic forces in their design of this Project when they don’t know what those forces are or for what duration they may be subjected to those forces.
“Has there ever been a paleoseismological study in the Project area to establish past earthquake or tsunami history?
“Wouldn’t it be in the best interest of the Proponent, the Panel and Canadians to know the risks before 1.3 billion litres of liquid petroleum products are allowed to be stored on a low ridge right beside Douglas Channel?”
In his final rebuttal on June 24, Neufeld did not address the contradictions that Minchin had pointed out.
Compare Enbridge’s attitude to the view of LNG Canada, which at very least, appears willing to consider that major events could have adverse consequences on the terminal and liquifaction facilities.
The first one is a bit puzzling to Kitimat residents “A 1 in 100 year 24 hour rain event,” after all the town often gets rain for 24 hours straight or more fairly often.
The second, 1 in 200 year flood of the Kitimat River. Flooding has always been a concern and will be even more so, because as the pipelines come into town, whether natural gas or bitumen, those pipelines will be close to the river bank.
Even more interesting is that LNG Canada is willing to consider possible effects of climate change on the project, saying: “Predicted climate change effects during the project lifecycle on sea-level rise, precipitation and temperature. Where relevant and possible, the implications of such climate induced changes to the extreme weather events given above will also be addressed.”
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Although the hydrocarbon industry as a whole is reluctant to acknowledge climate change, it appears that on a practical level, the LNG Canada partners, if they are about to invest billions of dollars in a natural gas liquifaction plant and marine terminal, will certainly take steps to protect that specific investment from the effects of climate change.
On the other hand, the National Energy Board, as matter of policy and the Northern Gateway Joint Review Panel, both still stubbornly refuse to even consider any effects of climate change, even possible effects locally on a specific project application.
The Joint Review Panel decision on the Northern Gateway is expected sometime in the next three weeks. While most reports seem to indicate that the decision will be released after Christmas before the Dec. 30 deadline, there has been recent media speculation that the decision could be released next week.
The problem for Enbridge is that the new public relations campaign is repeating the blunders that began when they first proposed Northern Gateway in 2005. There have been meetings across the northwest, but those meetings have been invitation only affairs at chambers of commerce and community advisory boards, with possible opponents or skeptics and media perceived as critical of Enbridge not invited. So Enbridge still wants to control the message and will only talk to friendly gatherings.
Then there are the television spots featuring Janet Holder, the Enbridge vice president in charge of Northern Gateway, supposedly showing her commitment to wilderness. Those commercials would have had more credibility if the agency had produced the ads with actual video of Holder walking through the bush, rather than shooting the spots in front of a green screen in a studio, with pristine wilderness stock video in the background, and Holder acting as if she was a model for an adventure clothing company rather than vice president of a pipeline company.
Right-wing business columnists in Toronto and the countless Albertans fume at the so-called “hypocrisy” of British Columbians who support LNG and oppose bitumen.
Of course, those critics didn’t feel the earth move under their feet. The critics don’t see the difference between natural gas and bitumen, differences very clear to the people of British Columbia.
It’s more than the fact, that so far, the LNG projects have been relatively open and willing to talk to potential adversaries, as Chevron has done on the controversial Clio Bay project; more than the fact that if even a fraction of the LNG projects go ahead, the money coming into northwestern BC means that the handful of permanent jobs promised by Enbridge will be literally a drop in a bucket of warm bitumen.
Although there are many other environmental issues on the Northern Gateway project, the fact the potential for earthquakes in Kitimat is brushed off by Enbridge while LNG Canada is at least willing to consider the problem, sums it all up.
Updated with link to Sept. 2011 questions and answers
At least one of the two large liquified natural gas projects in Kitimat is, at least at this point, planning to self-generate the power required using a gas-fired, steam-driven electrical generation system.
The job, which requires 20 years and more experience, would be located in Calgary for eighteen months, then move to Kitimat for the remainder of a four year contract paying from $1650 to $1850 per day.
By Fircroft describing the job as a “mega-project” means that the client is either Shell’s LNG Canada project or the Chevron and Apache KM LNG project, since the much smaller BC LNG project could not be described as a “mega-project.”
As well as the standard qualifications for a senior engineer, the job posting lists:
• Power Plant design, operation and construction experience required.
• Boiler design, construction, operation, and commissioning experience required.
• Heat Recovery Steam Generation (HRSG) design, processes, construction, operation, and commissioning experience required.
• Integrates inherent safety in design and operability in concept selection and development for gas resource opportunities.
Providing the power for the Kitimat and other northwestern LNG projects is becoming controversial. The power is needed to cool the natural gas so it can be loaded onto tankers for shipment to customers.
The BC government recently announced a $650,000 study of the cumulative effect on air quality for the planned industrial expansion in the Kitimat area, including the Rio Tinto Alcan Kitimat modernization project, which would increase the amount of sulphur dioxide emissions, combined with as many as three LNG projects and the associated increase in tanker traffic, as well as the possible and even more controversial Enbridge Northern Gateway project.
At the time of the BC announcement, the Globe and Mail reported:
If natural gas is used either for direct-drive or combined-cycle electricity generation to produce the energy required for the proposed Shell LNG facility at Kitimat, approximately 300 million cubic feet of natural gas would be burned. The proposed Chevron Apache LNG facility could burn approximately 140 million cubic feet of natural gas.
The other alternative for powering the LNG plants is to use hydro-electricity, and BC Hydro at the moment doesn’t have the capacity to supply the LNG projects with power. One possibility is the controversial Site C dam project in the Peace River basin, which is also under review by the BC government.
Although the job is restricted to Canadian citizens or permanent residents, it is clear that the engineer will have to also answer to the project’s overseas partners since one requirement is to conduct: “Overseas VIP workshops, including Value Engineering, Process Simplification, Process Optimization and Design to Capacity.”
Carrie Mishima, a communications advisor for the Department of Fisheries and Oceans sent this statement in response to questions from Northwest Coast Energy News:
· The proposal by the Kitimat LNG project uses a relatively new technique that is expected to improve aquatic habitat in Clio Bay. The bay has been used as a log handling site for decades, resulting in areas of degraded habitat from woody debris on the seafloor. The project will cap impacted areas with inert material to restore the seafloor.
· Capping at smaller-scale sites in Canada has shown that the technique has successfully restored low-value aquatic habitat.
· The project will implement standard and project-specific measures to protect fish and aquatic habitat and will conduct a five-year monitoring program to determine how well the habitat is recovering.
· Data from the monitoring program will be used to guide future habitat reclamation at impacted habitat sites. Reference sites are being established as benchmarks against which the capped sites can be measured.
· Site-specific standards for dissolved oxygen levels will be developed for the enhanced site by sampling a control site having similar habitat parameters.
· Detailed mapping has been done to identify the best areas for the soil placement and to protect sensitive habitat such as intertidal areas, rocky substrates and eelgrass beds.
· Other required mitigation measures will include analyzing the cap material to confirm it is free of contaminants and placing this material during appropriate tidal conditions to ensure accurate placement of the cap in accordance with design plans.
Special report: Clio Bay cleanup: Controversial, complicated and costly
Log booming operations at Clio Bay, August 21, 2013. (Robin Rowland/Northwest Coast Energy News)
Chevron, the company operating the KM LNG project at Bish Cove and the Haisla Nation have proposed that marine clay from the Bish Cove construction site be used to cap more than 10,000 sunken and rotting logs in Clio Bay. Haisla Chief Counsellor Ellis Ross says he hopes that using clay to cover the logs will help remediate the environmentally degrading sections of the Bay. The proposal has brought heated controversy over the plan, both among residents of Kitimat and some members of the Haisla Nation, who say that Clio Bay is full of life and that the capping will cause irreparable damage.
An investigation by Northwest Coast Energy News shows that capping thousands of sunken logs is a lot more complicated and possibly costly than anyone has considered. It is also clear that many of the comments both supporting and opposing the Clio Bay project are based on guesses rather than the extensive scientific literature available on the subject.
Northwest Coast Energy News findings include:
In 1997, the Department of Fisheries and Oceans surveyed sunken log sites in Douglas Channel. The results, published in 2000, identified 52 sites just on Douglas Channel and the Gardner Canal that had various levels of enviromental degradation due to sunken logs. Clio Bay was not the list. The DFO scientists recomended followup studies that never happened.
Scientific studies show that degradation from sunken logs can vary greatly, even within one body of water, due to depth, currents, number of logs, and other factors. So one part of a bay can be vibrant and another part environmentally degraded due to low levels of dissolved oxygen and decaying organic material.
If KM LNG wasn’t paying for the remediation of Clio Bay, it could be very expensive. Capping sunken logs at a cove near Ketchikan, Alaska, that is the same size and shape as Clio Bay cost the US and Alaska governments and the companies involved $2,563,506 in 2000 US dollars. The total cost of the cleanup of the site which was also contaminated with pulp mill effluent was $3,964,000. The estimated cost of capping the logs in the Alaska project was $110 per cubic yard.
The Alaska project shows that a remediation project means while most of the logs in a bay or cove can be capped, in some parts of a water body, depending on currents, contamination and planned future use, the logs have to be removed and the area dredged.
Agencies such as the State of Alaska, the US Environmental Protection Agency and the US Army Corps of Engineers all recommend using “clean sand” for capping operations. Although “clay balls” have been used for capping in some cases, the US officials contacted say they had no record of large amounts of marine clay ever being used for capping. They also noted that every log capping project they were aware of happened in sites that had other forms of contamination such as pulp mill effluent.
Chevron only recently retained the environmental consulting firm Stantec to study Clio Bay. The Department of Fisheries and Oceans has told District of Kitimat Council it recently completed mapping of the seafloor at Clio Bay. The Alaska project was preceded by five years of monitoring and studies before capping and cleanup began.
A letter from Fisheries and Oceans to the District of Kitimat says that Clio Bay has been mapped and the department is planning to monitor any capping operations. However, it appears from the Department of Fisheries and Oceans website that the department has no current policies on remediation since the Conservative government passed two omnibus which weakened the country’s environmental laws. According to the website, new remediation policies are now being drafted. That means that although DFO will be monitoring the Clio Bay operation, it is uncertain what standards DFO will be using to supervise whatever happens in Clio Bay.
Northwest Coast Energy News is continuing its investigation of the sunken logs problem. Expect more stories in the days to come.
Special report: Clio Bay cleanup: Controversial, complicated and costly
Haisla Nation Chief Counsellor Ellis Ross at Bish Cove, June 19, 2013. (Robin Rowland/Northwest Coast Energy News)
Haisla Chief Counsellor Ellis Ross says that capping the logs at Clio Bay was a Haisla idea, taking advantage of the opportunity to use the marine clay from Bish Cove to bring back the Clio ecosystem.
The Haisla were told by experts who video taped the bottom of Clio Bay that are between 15,000 to 20,000 sunken logs in Clio Bay.
“I know because I’ve spent a lot of time down there plus my dad actually worked for the booming company for years and knew what was going on out there,” Ross said. “There are two extreme areas we’re talking about, if you look at Clio Bay where it’s estimated that there 15,000 to 20,000 logs down there, imagine what Minette Bay looks like? And it’s all iron, it’s steel. It’s not just wood, there are a lot of cables down there.
Cables retrieved from Ward Cove, Alaska, during dredging and capping in 2001. (EPA)
“The Haisla have known about the degradation of our territory for years. The problem we have as Haisla members is to restore the habitiat is that nobody wants to clean up the habitat. This was our idea, after review from technical experts from DFO as well as our own experts. We’re looking for a three way solution, with the company, DFO and the Crown and the Haisla.”
“I’d love to go and catch halibut and cod, like my ancestors used to.”
He said that the Haisla have beem aware of environmental problems from sunken logs for decades and have been asking for cleanup of degraded areas since 2004, not just at Clio Bay, but in the Kildala Arm and at Collins Bay, which were studied by DFO in 1997.
“The logs are down there, they are oxidizing, but no one wants to do anything about it, including the company and including the Crown. We had independent people come in and review it and have them come up with a recommendation. There was a small scale project [involving marine clay] that proved that this could work.
“This system here is killing two birds with one stone, get rid of the clay and try to remediate some of the habitat,” Ross said.
He said that the original estimate of marine clay excavated at Bish Cove was 10,000 cubic metres. That has now risen to about 3.5 million cubic metres because the KM LNG project is digging deeper for the foundation of the LNG terminal. The original plan called for disposing 1.2 million cubic metres at sea and another 1.2 million cubic metres on land.
“The original idea was to dump the clay in the middle of the ocean. In small amounts it could have been mitigated, but in large amounts we said ‘no.’ If we try to dump clay in the middle of the channel, we have no idea where it’s going to end up, what the effect is going to be.” Ross said. “We did the same thing here for the terrestrial side, we said ‘OK that with the rock quarries above Bees Creek,’ use the clay to help remediate that as well, bring it back.”
Asked about Ward Cove in Alaska, where the US Environmental Protection Agency ordered a cleanup, Ross said. “The difference here is that no one is ordering these companies to clean up the sites, they walk away. No one is taking responsiblity, The Haisla are trying to do this within the parameters they’ve given us.So if someone could come in and order these companies and do something, we’ll look for something else to do with the clay. Until that day comes, the Haisla are still stuck with trying to bring back this land by ourselves. If the District of Kitimat wants to pay the bill, great. Let’s see it.
“We need to put pressure on the province or Canada to cleanup these sites. We’ve been trying to do this for the last 30 years. We got nowhere. Before when we talked about getting those logs and cables cleaned up, it fell on deaf ears [at DFO]. They [DFO] had no policy and no authority to hold these companies accountable. So we’re stuck, we’re stuck between a rock and hard place. How do we fix it?”
Ross also noted that Shell’s LNG Canada project also faces remediation problems, “Shell is going to have the same problem, their’s is going to be different, they’re going to have get rid of contamination on the ocean bottom and beneath that it’s basically going to be gravel, it’s not clay, they’re going to have get rid of that product.”
Special report: Clio Bay cleanup: Controversial, complicated and costly
Here is the text of a statement Chevron spokesperson Gillian Robinson Riddell sent to Northwest Coast Energy News
The Clio Bay Restoration Project proposed by Chevron, is planned to get underway sometime in early 2014. The proposal is fully supported by the Federal Department of Fisheries and Oceans and the Haisla First Nation Council. The project has been put forward as the best option for removal of the marine clay that is being excavated from the Kitimat LNG site at Bish Cove. Chevron hired Stantec, an independent engineering and environmental consulting firm with extensive experience in many major habitat restoration projects that involve public safety and environmental conservation. The Haisla, along with Stantec’s local marine biologists, identified Clio Bay as a site that has undergone significant environmental degradation over years of accumulation of underwater wood debris caused by historic log-booming operations. The proposal put forward by the marine biologists was that restoration of the marine ecosystem in the Bay could be achieved if marine clay from Chevron’s facility site, was used to cover the woody debris at the bottom of the Bay. The process outlined by the project proposal is designed to restore the Clio Bay seafloor to its original soft substrate that could sustain a recovery of biological diversity.
In preparing this restoration project proposal for Chevron, Stantec conducted independent field studies carried out by their own marine biologists who are registered with BC College of Applied Biology. Two of the studies used in the development of the proposed project were previously published scientific studies on the effects of log-boom activity and log boom activity in Clio Bay that determined log boom and storage activity has had a negative impact on marine diversity. There are previous case studies where capping activity has been used in marine environments.
Stantec’s, and previous studies, have determined that Clio Bay has changed from a once highly productive marine bay characterized by plentiful predatory species such as Dungeness Crab and sunflower stars to a less productive environment hosting more opportunistic and resilient species such as squat lobster and sea anemones. One such study found that compared to Eagle Bay, which has not been affected by logging activity had five times the Dungeness Crab population of Clio Bay. Independent studies conducted before Chevron began working at Bish Cove found that if Clio Bay is left in its current degraded condition, the woody debris will continue to foster and abnormal, species-deficient habitat for several decades. Extensive fieldwork carried out by Stantec’s marine biologists used SCUBA and Remote Operated Vehicle surveys to observe and record all flora and fauna in the bay and its levels of abundance. Stantec’s observations echoed the previous studies which determined that the massive amount of wood has harmed Clio Bay’s habitat and ecosystem.
Most importantly, when considering the work Chevron is proposing to carry out in Clio Bay, it is important to note that a primary objective of all Chevron’s operations is to protect people and the environment. A good example of how we have done that on other projects can be seen in the construction of Chevron’s Gorgon LNG plant in Australia on Barrow Island, which is a Class A nature reserve. Although identified as one of the most important wildlife refuges in the world, and the site was chosen only after a thorough assessment of the viability of other potential locations, and after the implementation of extensive mitigation measures, including a vigorous quarantine program for all equipment and materials brought on to the Barrow island site to prevent the introduction of potentially harmful alien species. Those same high environmental standards are being applied to the Kitimat LNG project and the proposed Clio Bay Restoration project. The proposed work would be carried out with a stringent DFO approved operational plan in place and would be overseen by qualified environmental specialists on-site.
Apache 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.
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.
As part of the strengthened and modernized Canadian Environmental Assessment Act, 2012 (CEAA 2012) put in place to support the government’s Responsible Resource Development Initiative, the Canadian Environmental Assessment Agency must decide whether a federal environmental assessment is required for the proposed Pacific Northwest LNG Project in British Columbia. To assist it in making its decision, the Agency is seeking comments from the public on the project and its potential effects on the environment.
Progress Energy Canada Ltd. is proposing to construct and operate a liquefied natural gas (LNG) facility and marine terminal near Prince Rupert, within the District of Port Edward. The Pacific Northwest LNG facility would be located on Lelu Island. The proposed project would convert natural gas to LNG for export to Pacific Rim markets in Asia.
The agency says written comments must be submitted by March 11, 2013.
The CEAA says it will post its decision on the website if a federal environmental assessment is required.
It goes on to say:
If it is determined that a federal environmental assessment is required, the public will have three more opportunities to comment on this project, consistent with the transparency and public engagement elements of CEAA 2012.
Projects subject to CEAA 2012 are assessed using a science-based approach. If the project is permitted to proceed to the next phase, it will continue to be subject to Canada’s strong environmental laws, rigorous enforcement and follow-up, and increased fines.
By “CEAA 2012,” the agency is referring to the omnibus bill, best known as C-38, which actually weakened the CEAA’s ability to review projects. “Science-based approach” has become a stock phrase used by the government of Stephen Harper on resource issues, while it weakened environmental review procedures, terminated the jobs of hundreds of scientists and restricted those who are left in the government from speaking to the media or commenting on issue.
