Kitsault as LNG Port Not Just a Pipe-Line Dream
Monday, January 14, 2013 @ 3:57 AM
Prince George, B.C. – You may have heard last week about the owner of the community of Kitsault B.C., looking to make the abandoned town a hub for liquefying and shipping natural gas.
Krishnan Suthanthiran purchased the former mining town in 2005, and since then has presented a number of ideas to make it an economically self sustaining community. His latest idea involves a call to those in the natural gas sector to look at Kitsault as a site for a natural gas liquefaction plant, and an export port. It’s a project that could cost investors somewhere in the $20-$30 billion dollar range but is viable he says because the community is all ready to accept a new workforce.
The town was abandoned after the molybdenum mine closed in 1982.
Well, it just so happens, Spectra Energy is in the natural gas pipeline business and is partnered with BG Group out of Britain, to deliver natural gas to BG’s proposed LNG plant on Ridley Island in Prince Rupert. The proposed pipeline route presents three options once it hits the Cranberry Junction. One of the proposed routes heads straight to Kitsault. Once there, the proposed line would then take a marine route to Prince Rupert.
Doug Bloom, the President of Canadian LNG for Spectra, says the idea is worth thinking about. "We’ve worked really closely with BG , they’re a great partner, we’ve worked really closely with them on the three pipeline routes to get into Prince Rupert, They’re settled on their site (Ridley Island). But, we certainly think a lot about Kitsault as a site. We’ve actually referred a couple of companies on to the folks at Kitsault saying if you’re interested in developing LNG, this is potentially a place you could do it, it could be very suitable.”
What if there were two pipelines built from the North east of B.C. to the Cranberry Junction? One line could then carry natural gas to a plant in Kitsault, the other to a plant in Prince Rupert. Bloom says Spectra has examined the potential for twin lines “We think that getting to Prince Rupert we should find a corridor that can accommodate multiple pipelines, and the one we selected with BG can accommodate more than one pipeline. In fact the project description we have filed with the Environment Assessment Office in British Columbia, actually provides for one, and possible two pipelines, so I think there’s an opportunity to just collaborate and do things as efficiently as we can. It’s going to be a very large investment to get these new pipelines in place. We as an industry are going to have to look for ways to do it as efficiently as we can, and do it with a minimum of environmental disruption too, I think there’s good opportunities for doing that if something can be developed at Kitsault.”
Comments
The thing is once all these gas pipelines go through I think that rules out the Enbridge Gateway pipeline as the gas will have a higher market value going to Asia than it will going to the oil fields.
I don’t think Gateway has the money to pay BC the opportunity cost of foregone gas royalties let alone the the risk cost of a bituman spill.
The real question for gas exports revolves around BC having only a 100 year supply at todays consumption levels and the prospect of paying world prices ten times what we currently pay. How will we heat our homes in the future within our lifetimes? Will we be going back to electric heat, bio-fuel heat, or geo-thermal heat… and who is posed to develop the mega conversion that will need to take place to keep our homes economically competitive during the winter months?
Will any of the gas royalties bonanza for the gas companies and the government be going to help home owners cope with the conversion in home heating that will need to take place once these projects are a reality?
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