Two liquid natural gas terminals in Kitimat. One has to wonder if they will both be cooling the gas to a liquid using electricity? If so how will this effect the Hydro rates for home owners and other industry in BC? Do we have enough existing excess supply or do they have plans for Site C or an insidious hidden agenda for Kemano?

If our infrastructure does not have the available hydro power, will they also be burning natural gas in the airshed to provide their own in-house power? If so have they done any modeling to see what the airshed can handle? Will those models make competing projects mutually exclusive? Have those opportunity costs been identified to determine the projects BC wants? If additional power is required could it be produced through a local Hog fuel Co-gen facility located in Burns Lake to keep the forest workers working providing beetle kill trees of little commercial value for energy production for the grid… maybe tied directly to one of these gas export projects as a CO2 credit that keeps their usage segregated from local BC consumption markets?

How will the domestic natural gas markets be protected by the much higher world market prices? Will there be an export tax based on the Canadian natural gas prices to bridge the difference for the export world market prices… thereby protecting the domestic market prices?

Considering their history can we trust the BC liberals to be telling BC the whole story?

Lots of big questions on the logistics and the greater planning going on around these projects IMO.

http://m.theglobeandmail.com/news/national/british-columbia/bc-politics/bc-abandons-self-sufficient-energy-plan/article2325632/?service=mobile

The news has been out since Thursday last week with an explanation of how the electricity is to be acquired.

A steam power generating plant using natural gas for fuel can generate the electrical energy needed to run the compressors to liquify the natural gas which is to be exported.

Our pulpmills here in town generate electrical power and Hydro buys some of it if they have a surplus.

Why all the controversy?

Good post Eagleone. I think that we need to look at some interesting things that have taken place in the last few months.

1. Rio Tinto Alcan has made an application to the BC Government for permits to complete the Kemano (2) Tunnel. In addition they have made application for a temporary water license. The completion of the tunnel is ostensibly to make it possible for them to do maintenance on the number (1) tunnel.

2. Rio Tinto has come to an agreement with the Cheslatta Natives after 10 years of negotiations, and they have now returned 11000 acres of land to the Cheslatta that was expropriated in 1951, with no strings attached. The Cheslatta now state that they can work with Rio Tinto.

3. The surplus power presently generated at Kitimat is a result of Alcan shutting down a couple of pot lines a number of years ago. This surplus power is presently being sold to Hydro. The City of Kitimat went to court to try and stop the sale of this power, arguing that the 1951 agreement stated that the surplus power was to be used in the immediate area of Kitimat for industrial/commercial growth. The Gordon Campbell Government sided with Alcan in the court case and the City of Kitimat lost.

4. Rio Tinto has given the go ahead for the new alum igot plant in Kitimat. This is a $2.5 billion dollar project, and once completed it will double the production of ingots. It will also use up all the surplus power from Kemano (1). In addition it will reguire 400 less people to run the plant.

5. When the NDP Government (Mike Harcourt) stopped the completion of Kemano (2) the Government had to pay a huge amount of money to Alcan for stopping the project. In addition they have an agreement with the Government that if they are short of power, the Government (BC Hydro) are required to supply it.

6. The BC Government needs these LNG Plants to be run by electricity because that is clean energy and helps them reach their 30% reduction in green house gases. Having these plants operate on Natural Gas, or Bio Energy would not. Hence the push for electricity.

So lets see what we have.

a) An agreement with the Cheslatta that takes care of some of their concerns in regards to land.

b) The completion of the Kemano (2) Tunnel ostensibly for maintenance reasons.

c) The location of three LNG plants in the Kitimat area that will require huge amounts of electricity to convert the gas to liquid form for shipping, and will create industry in the immediate area of Kitimat which was in the original agreement between Alcan and the BC Government.

d) The start/completion of the power lines up highway 37 to service mines/industry in that area.

e) The loss of the sale of surplus power to Hydro by Alcan, because they now need this power for their own use.

The Kemano (2) Tunnel was originally designed for the installation of two more turbine generators to produce electricity.

My guess is that at some point we will see Rio Tinto Alcan make application for the generating of power by the Kemano (2) tunnel. This power would meet the needs of Alcans new plant, the LNG plants, and to some extent the needs of industry and mines on Highway 37.

The downside is that upon the comletion of Kemano (1) 75% of the water that used to go to the Nechako River, went through the tunnel, generated electricity, and then emptied into the Pacific Ocean.

In order to generate additional power for Kemano (2) they would need to take additional water from the Nechako Watershed that would have a devastating effect on irrigation, salmon, etc; In fact some people would say that it will destroy the Nechako to the point that we would be able walk across it during the summer months.

Thats my take on it at this time.

Palopu, I think you are right on your take for the power needed… it will be a betrayal by our government, but I have no doubt thats in the works.

Then we have the amazing issue of world market prices… its sad that no one with any power addresses the world market prices when it means if they can sell one ton at the higher price it means they can sell every ton currently consumed in Canada for that ‘going rate’ (hence an export tax to bridge the gap). This premium on Canadian rates could cost Canadian consumers and Canadian industry Billions in added energy costs.

Through policies like the ones we see playing out they produce picked winners at the expense of the losers… the divide between the rich and the poor widens… and local industry loses out to foreign competition and the multinational world markets energy policy. If we loose the energy advantage, and we lost the labor advantage, and we lose the environment advantage, and we export our human trademark ingenuity… then all we have left is multinationals and an economy far removed from the needs of our society. We become a casino economy on the whims of foreigners.

IMHO

The Coastal First Nations Great Bear Initiative has been very responsible and far sighted with respect to clean, green, renewable energy that can be generated within the traditional territories of the Nations involved. Run of river projects abound as well as a “shovel ready” wind project (Naikun) that could nicely provide much of the needed power. As run of river is subject to the “freshet” fluctuation and wind doesn’t blow 24/7 some natural gas generated electricity would be needed to firm up the supply.
Benefits would flow to the First Nations in the form of jobs and royalties which are sorely needed.
I hope this government has the foresight and good sense to seriously consider this alternative to energize the LNG plants.