BC moving ever forward on LNG

//

Two milestones have been reached that show how steadily BC is progressing toward becoming a key exporter of liquefied natural gas, LNG.

For one, LNG Canada reported the arrival by ship of three huge pieces of equipment for its processing plant. (One, a main cryogenic heat exchanger, MCHE,  is pictured below.) 

One of our Facebook fans quickly wrote: “Wait until the modules start arriving.”

He was referring to massive prefabricated constructs that will also come in by ship to Kitimat, and be moved, slowly and carefully down a heavy-haul road, to the project site. (The picture beneath that of the MCHE below is of typical “module” units destined for a Russian LNG plant.)

The steel modules for LNG Canada will be 50 metres high, 70 metres long and 35 metres wide and weigh more than 9,500 tonnes each. There’s no date confirmed for arrival, but bets are on later this year.

The biggest piece that arrived at Kitimat June 7 was a main cryogenic heat exchanger (MCHE), some 50 metres in length. Once installed vertically, it will be among the most visible components at the LNG Canada facility. And there were two pre-cooler units, which weigh 308 tonnes and 284 tonnes.

Another MCHE is expected to arrive later this year, along with two more pre-coolers.

The second milestone for BC came a day later, June 8, when Pembina Pipeline Corp. announced it would buy a 50% stake in the Haisla Nation’s proposed Cedar LNG project.

“It was important for us to find a partner with the same values of environmental protection and community-centred development,” said Crystal Smith, the Haisla Nation’s elected chief councillor (and, incidentally, chair of our First Nations LNG Alliance).

“With a strong partnership, Cedar LNG will bring tremendous economic opportunities and benefits ensuring the Haisla people have control of our own future.”

Pembina expects to invest about $90 million in Cedar LNG over the next 24 months, to cover the acquisition of its 50% share and for development costs. Then Pembina will be responsible for pre-construction, construction and operation of the facility.

Pembina owns pipelines, gas gathering and processing facilities, and its export terminal business includes a propane terminal at Prince Rupert. (Pembina is also forming a partnership with the Western Indigenous Pipeline Group that hopes to buy the Trans Mountain oil pipeline.)

The Haisla Nation’s leaders will soon be meeting with members to explain the Pembina partnership in Cedar LNG. Meanwhile, the BC Environmental Assessment Office last week held two online public open houses on the project, as part of the EAO’s assessment and approval process.

Cedar LNG will be a floating plant on Douglas Channel. It will get its natural gas through the Coastal GasLink pipeline, which will also feed LNG Canada.

Meanwhile, the Nisga’a Nation is working on a proposal for its own, and much bigger, floating LNG-for-export plant near the mouth of the Nass River.

LNG Canada plans to produce 14 million tonnes a year from its first phase (which could then add more through expansion); Woodfibre LNG plans 2.1 million tonnes. Cedar LNG would produce 3-4 million tonnes. And Ksi Lisims proposes 12 million tonnes.

Now, where will those tonnes go? With all the current talk of a future of net-zero emissions and a switch to renewable energy, how does the world LNG market look?

Fraser McKay of the top market-watching consultancy, Wood Mackenzie, says: “The world will still need oil and gas supply for decades to come, and the scale of the industry will remain enormous.”

Shell (which owns 40% of the LNG Canada project) sees world demand for LNG almost doubling by 2040, with Asia driving nearly 75% of the growth in demand.

While China speaks of becoming carbon neutral by 2060, it is expected take more and more LNG to replace or re-engineer power plants that now use coal. China is expected very shortly to overtake Japan as world’s top LNG buyer.

And market-watchers see India’s demand for LNG accelerating strongly as it closes in on supplanting China as the world’s most populous nation and biggest energy consumer.

It’s clear, though, that LNG importers and buyers will increasingly want “greener” LNG, with lower emissions all the way from the gas wells to the production of the LNG.

And BC LNG developers are already well ahead in that field.

LNG Canada, for one, says: “Reducing emissions overseas is not enough. LNG Canada must also live up to climate promises at home. That means working with our Joint Venture Partners to ensure our natural gas supply chain – from well-head to tidewater – has the smallest amount of greenhouse gas emissions possible.

“GHG emissions from LNG Canada’s Kitimat operation will be lower than any facility currently operating anywhere in the world today: 35 per cent lower than the world’s best performing facilities and 60 per cent lower than the global weighted average.”

Another future exporter, Woodfibre LNG, reports simply: “Woodfibre LNG will be the cleanest LNG facility in the world.”

FortisBC notes its LNG from the Tilbury facility in Delta is already produced with “nearly 30 per cent less carbon intensity than the global LNG supply.”

And Fortis is working on doing even better: “LNG from Tilbury could be produced and delivered to vessels with up to 50-per-cent lower lifecycle carbon-intensity than the global average LNG supply.”

Cedar LNG will be powered by electricity from BC Hydro, which will make Cedar LNG “one of the lowest carbon-intensity facilities in the world.”

And the Nisga’a Nation says its Ksi Lisims project would be a net-zero operation, and “Ksi Lisims LNG can reduce global GHG emissions by 50 million tonnes per year.”

But all will be working to improve even further on those strengths and decarbonization. Look for more and more carbon-capture projects in BC, and for strenuous efforts to cut down unwanted leakage of methane.

First, a picture of the main cryogenic heat exchanger, which will rise vertically at the LNG Canada plant.

And here’s a photo of typical LNG plant “modules.”

(Posted here 15 June 2021)

First Nations LNG Alliance Newsletter