What B.C.’s LNG megaproject means for two proposed Nova Scotia facilities
Some see it as a signal of investor confidence in liquefied natural gas megaprojects. Others say it could edge out less competitive LNG proposals in Canada.
Either way, final approval of a massive LNG project in northern British Columbia has renewed interest in the fate of two projects slated for Canada’s East Coast.
Bear Head LNG, a subsidiary of Australia-based Liquefied Natural Gas Ltd., has a site on the Strait of Canso while Goldboro LNG, a Pieridae Energy Canada project, is adjacent to the Maritimes and Northeast Pipeline on Nova Scotia’s Eastern Shore.
Both companies say the decision by five partners — a consortium of state-owned and private investors — to move forward with LNG Canada’s $40-billion joint venture in Kitimat, B.C., bodes well for major resource projects in the country.
But energy consultant Tom Adams says the British Columbia development makes the prospects of a Nova Scotia LNG facility in the near future less likely.
He says there is a finite global market for LNG, and that if the B.C. project moves ahead it weakens other projects.
``Every time there is a new entrant it puts competitive pressure on all the other proposals,’’ the independent Toronto-based analyst said in an interview.
Adams said the “really big boys’’ have invested in B.C. — Royal Dutch Shell, Mitsubishi Corp., the Malaysian-owned Petronas, PetroChina Co. and Korean Gas Corp. — but the Nova Scotia proposals have yet to attract the same calibre of investors.
“The majors have by and large stayed out of it, and I think that’s another indication of the relative strengths and weaknesses of the development plans,’’ he said. “It’s another reason for my continued skepticism with respect to LNG in Nova Scotia.’’
However, Goldboro LNG has managed to secure a customer.
Uniper SE, a German energy firm, has signed a 20-year agreement for half of Goldboro’s permitted output, a coup for the Nova Scotia project. The contract comes with a German government-backed debt guarantee.
Mark Brown, vice-president, business development for Pieridae Energy, the firm developing Goldboro LNG, said the B.C. project is good for the entire industry.