A federal minister, talking on the world LNG2023 convention about LNG exports, stated that “Canada should hold tempo as a result of we can not afford to fall behind.”
However as Randy Boissonnault, Canada’s tourism minister and affiliate minister of finance, spoke in Vancouver, there got here phrase of much more competitors for Canada’s exports of LNG from the West Coast.
First, the U.S. Vitality Info Administration checked out how U.S. LNG exports will enhance subsequent yr as two export terminals come on-line:
“We anticipate U.S. LNG exports to common 12.0 billion cubic ft per day (Bcf/d) in 2023. In 2024, with the 2 new LNG export initiatives, we anticipate LNG exports to extend to 13.3 Bcf/d.”
The approaching crops are Golden Cross Trains 1 and a pair of (being constructed at an current LNG import terminal in Texas that will probably be transformed into an LNG export facility) and Plaquemines LNG Section 1, in Louisiana.
“We estimate Golden Cross Trains 1 and a pair of and Plaquemines Section 1 will add a complete of two.7 Bcf/d of nominal LNG export capability, or 3.2 Bcf/d of peak capability. By the tip of 2024, U.S. LNG nominal liquefaction capability will enhance to 14.1 Bcf/d and peak capability to 17.0 Bcf/d throughout the 9 U.S. LNG export services.”
And past these 9 U.S. LNG-for-export crops, seven extra are underneath development, and 28 additional ones are in numerous phases of proposal, planning, growth, or working towards capability and monetary commitments.
We will observe that B.C. will nonetheless get pleasure from a bonus: The supply time for LNG cargoes to Asia is seven to 9 days for Western Canadian producers. For producers on the US Gulf Coast it’s 21-27 days. They thus face further delivery prices, they usually face expensive Panama Canal charges on high of it.
However Mexico has introduced plans to develop eight LNG-for-export terminals that might get U.S. and/or Canadian pure gasoline by way of the US.
4 of these crops can be on Mexico’s west coast, and would have decrease delivery prices to Asia than Gulf Coast services. And they’re speaking of getting decrease manufacturing prices, so they might discover it simpler to compete with B.C. crops for Asian prospects.
- To ship LNG from the Golden Cross plant to South Korea’s large Incheon LNG-import terminal, by way of the Panama Canal, would imply a crusing time (assuming a provider pace of 20 knots on the open ocean) of just about 21 days. Plus a one-way Panama Canal price that might exceed $800,000 (Canadian) in 2025.
- The deliberate Mexico Pacific LNG plant, on the east coast of Mexico’s Gulf of California, would imply a voyage of 14 days to Incheon.
- To ship from Mexico’s Costa Azul LNG venture, underneath development on the west coast of Baja California, would contain a voyage of 12 days to Incheon.
- To ship from LNG Canada at Kitimat to Incheon would imply a crusing time of just below 10 days.
However, once more, Mexico is speaking of getting decrease manufacturing prices; in that case, its LNG may then be cheaper than ours. (Nonetheless, we do have some edge resulting from our cooler local weather right here.)
The Costa Azul venture (Sempra LNG and Infraestructura Energetica Nova) is underneath development north of Ensenada, on the west coast of Baja California. It’s anticipated to enter manufacturing in late 2024.
It’s to start with one manufacturing practice, which may initially produce some 2.5 million tonnes of LNG a yr. However proposed growth would add roughly 12 million tonnes of export capability.
And it already has 20-year gross sales and buy agreements with Japan’s Mitsui and France’s TotalEnergies.
Mexico Pacific now has been promised robust nationwide and state authorities help for its Saguaro Energia venture on the Sonora coast.
The US$14-billion venture will produce 15 million tonnes a yr from three manufacturing trains. Enlargement to double its output can also be in growth.
The primary spherical of completion in 2026 will coincide with the beginning of a long-term contract contract to provide Shell with 2.6 million tonnes a yr from 2026 via to 2045.
The venture additionally has an settlement to supply two million tonnes a yr to China’s Guangzhou Growth, additionally from 2026 to 2045.
Minister Boissonnault stated on the convention in Vancouver that “the event of an at-scale LNG economic system is a strategic precedence for Canada.”
He added: “The world’s main economies are transferring at an unprecedented price and tempo to battle local weather change, retool their economies and construct the net-zero industries of tomorrow.
“Canada should hold tempo as a result of we can not afford to fall behind – that’s the reason the event of an at-scale LNG economic system is a strategic precedence for Canada. . . .
““The actual fact is, we face a altering local weather, and to make use of a really Canadian assertion, we should skate to the place the puck goes. On this context, Canada is effectively positioned to be a secure and dependable international provider of alternative.
“We . . . have the power to supply LNG with the world’s highest environmental requirements and lowest emissions.”
In the meantime, main investments in LNG are being made in the US, Norway, Qatar, and Saudi Arabia in addition to Mexico.
There’s clearly some powerful competitors on the market. . . .
Picture: The Costa Azul plant, Baja California, Mexico
(Posted right here 26 July 2023)