We hold a watchful eye on potential competitors for abroad gross sales from our B.C. LNG crops.
We often look south for this — however now we should always look northwards as properly, as a result of a proposed mission in Alaska may match our “pure benefits” in LNG exports.
South of us, the U.S. has seven energetic LNG-for-export crops, three extra underneath building, and one other 15 at varied phases in planning or approvals processes.
The main places for U.S. crops are on the Gulf of Mexico. Lately, they’re overwhelmingly centered on delivery LNG to Europe. (Which incorporates some Canadian pure fuel processed into LNG by the U.S.)
The Gulf Coast crops are nonetheless sending some shipments to Asia, and should start later this 12 months to ship extra, however in these they’ll finally must compete with our pure benefits.
These B.C. benefits:
- Our crops shall be solely 10-12 days crusing for an LNG provider to succeed in Asian patrons. From the Gulf Coast, although, it’s 20-24 days, which means more cash spent on the vessel and the voyage, and extra emissions.
- Gulf Coast producers face hefty prices for transferring an LNG provider by the Panama Canal to succeed in Asian markets. Canal charges now run greater than US$500,000 for a loaded Asia-bound provider and greater than US$420,000 for a provider returning empty.
- We don’t must pay these further days of crusing time, or these canal charges.
- And due to our cooler local weather, our manufacturing prices in chilling pure fuel shall be a little bit decrease than theirs.
However all the benefits we have now listed for B.C. face a possible risk — from a proposed US$39-billion LNG-for-export plant in Alaska.
Proper now, that plant at Nikiski, close to Anchorage, and a 1,290-km fuel pipeline to feed it, are nonetheless proposals on paper, from the state-owned Alaska Gasline Growth Company.
However the U.S. Division of Power gave the mission a inexperienced gentle final week for exports, following a 10-year environmental allowing course of.
The U.S. Federal Power Regulation Fee and the State of Alaska had already given go-aheads to construct and function the amenities.
The LNG, they are saying, can be exported primarily to nations in Asia, in competitors with Russia. However meaning additionally with us.
And one of many first issues the builders famous is that the Alaska plant can be solely 7-9 days delivery time away from Asian markets.
The proponents hope it will likely be operational by 2030 in the event that they get funding cash and all required permits. That’s a a lot quicker schedule than anybody in Canada has been in a position to execute.
The Nikiski plant would produce 20 million tonnes of LNG a 12 months, in contrast with 14 million from Part One in every of LNG Canada, which hopes to be in manufacturing in mid-2025.
(Woodfibre LNG would prove 2.1 million tonnes a 12 months. The Haisla Nation’s Cedar LNG would produce three million tonnes and the Nisga’a Nations Ksi Lisims mission 12 million.)
All Issues LNG stories:
- Northern Alaska has some 35 trillion cubic ft of confirmed sources and potential for an additional 200 trillion. (The Montney fuel formation extending from northeast B.C. into Alberta is estimated to comprise 400 trillion cubic ft of recoverable, sales-quality fuel.)
- Positioned at Prudhoe Bay, the Alaska fuel therapy plant will course of 3.9 billion cubic ft of fuel per day, eradicating impurities earlier than it’s piped south to the liquefaction facility;
- An 800-mile pipeline will transport fuel from Alaska’s North Slope to Nikiski, following a well-established hall on state and federal lands;
- The Nikiski facility could have three LNG trains (manufacturing strains) and two storage tanks;
- A few of the LNG can be utilized in Alaska, and “the mission guarantees job creation, income technology, and vitality safety for Alaska.”
Nonetheless on paper, true, however a competitor to be careful for.
And to cap all of it, there would possibly even be a little bit future competitors for B.C. from Mexico. That nation plans eight LNG crops, and 4 of them can be on Mexico’s west coast.
Our governments must take all this under consideration: The tougher they make it for Canadian LNG growth and exports, the simpler they make it for the competitors.
(Posted right here 20 April 2023)