GOLDBORO — A veteran Calgary natural gas executive told a hall tightly packed with retired fishermen, loggers and their wives on Wednesday that he’s bringing $5 billion of investment to Guysborough County.
You could have heard one of the free Timbits on offer hit the floor.
“Goldboro provides an excellent location for exports and will be the east coast of Canada and the United States’ closest mainland LNG terminal to Europe and India,” said Alfred Sorensen, president of project proponent Pieridae Energy Canada.
“It’s going to happen because the market wants it to happen.”
Sorensen’s proposal to build a natural gas liquefaction facility and export terminal on this coast of abandoned gold mines and rotting fishing boats would turn northeastern North America from a natural gas import market to an export market.
While Guysborough County has seen a steady stream of proposed megaprojects collapse over the past two decades, the North American natural gas industry is taking notice of this one.
“It’s serious,” said Alex Steis, managing editor of NGI’s Shale Daily in Washington, D.C.
“It’s by no means any sort of coronation — for every five projects maybe one goes ahead — but this play has made the industry in the United States and Canada pay attention to Goldboro.”
While $5 billion seems an impossible amount of money in a corner of the province better versed to weighing pounds of lobster, Steis said it exists in the world of natural gas.
That world has been turned on its heels by the ability of the oil and gas industry to extract natural gas from shale rock deposits in North America. While as recently as five years ago plans were being hatched to import liquefied natural gas to satisfy the burning energy needs of the northeastern United States, hydraulic fracturing has turned an import market into one flush with natural gas.
That supply has depressed the price to about $3.50 a gigajoule in New York. Meanwhile, in India, it’s going for around $10 a gigajoule. Then there’s Europe, which is paying high prices for natural gas from Russia.
“Some potential investors could be the producers of natural gas,” said Steis.
“Now that the United States has begun developing its vast shale plays across the country, talk of reversing the pipeline wouldn’t surprise me.”
Sorensen said Wednesday his company has been in discussions about reversing the flow with the owner of the 1,400-kilometre-long Maritimes & Northeast Pipeline, which brings Sable Island natural gas ashore in Goldboro and down into Massachusetts.
The liquefaction plant proposed for Goldboro would see one-third of its supply come from U.S. shale gas, a third from Canadian natural gas and a third from offshore natural gas.
Sorensen estimates that if the environmental assessment process can be completed within the next year and a half, construction could be complete by November 2018. It is estimated it would take 1,500 people to build the facility and from 100-200 workers to run it.
Goldboro has heard big promises before. A proposed $5-billion project by Keltic Petrochemicals and Maple LNG to import and process natural gas finally died two years ago.
Lloyd Hines, warden of the Municipality of the District of Guysborough, who watched the last project get announced, dwindle and die, remains bullish on Pieridae.
“As a municipality our job is not to know fully the world markets that determine a project like this,” said Hines.
“Our responsibility is to zone properties and condition the community, then go trolling for opportunities and see if we can get a fish on the hook. I think we’ve landed a tuna here.”
The possible benefits for Guysborough County are twofold if the project goes ahead, said Hines.
“If you look at a $5-billion project and 10 per cent of that is taxable, then you’re looking at millions of dollars of additional revenue for the municipality and province,” he said.
The biggest factor, said Hines, is possible employment. Rural Guysborough County has been gutted over recent years. A massive influx of 1,500 temporary workers and then a smaller force of permanent employees to run the plant would revitalize communities, churches and schools, he said.
After Sorensen and local politicians finished speaking, Marshall Hodgson stood mulling over the proposal. While grand announcements have come and gone, the Country Harbour native, who spent most his life cutting pulp wood, has watched the younger generations of his family head west.
“I’m going to hope for it,” said Hodgson.
“I’ve watched the young leave. My nephews leave. My son-in-law is a paramedic and he’s about to leave for out west. I’ve known Warden Hines for years and I have faith this is going to happen.”
(
[email protected])
COMMUNITY HOLDS ITS COLLECTIVE BREATH
If Pieridae Energy Canada succeeds in building its proposed $5-billion liquefied natural gas terminal in Goldboro, it will be bucking some major related industry history in the area.
- In 1998, Sable Petrochemical of Houston announced plans to build a $600-million petrochemical plant in the Strait of Canso area by 2002. But nothing came of the plan to use ethane from the Sable offshore natural gas project, which has its landfall at Goldboro, to make polyethylene.
- Anadarko Petroleum Corp. of Texas planned to build a $650-million LNG facility in Bear Head, near Port Hawkesbury. It even went so far as to build cement pads at the site to support gas storage domes. But that was as far as the project got before Anadarko abandoned it in 2006, after taking a $111-million writedown. Uncertain long-term gas supplies played a role in Anadarko’s decision to pull up stakes in the Strait.
- Keltic Petrochemicals of Halifax shelved its $4.5-billion plan to build a petrochemical plant near Goldboro in 2010. Keltic cited a lack of gas supply and poor global economic conditions as reasons for the demise of the mega-project, first announced in 2002.
- Shortly after the Keltic decision in 2010, MapleLNG, a Canadian subsidiary of a Dutch company, 4Gas, cancelled its plans to build a $700-million LNG facility near the proposed Keltic plant. It blamed falling demand and low gas prices for the decision to pull the plug.
Pieridae president Alfred Sorensen is the former president of Galveston LNG Inc., which initiated a similar LNG terminal project being developed under new owners in Kitimat, B.C.
He has targeted Europe and Asia as export markets for gas from Goldboro that he said will come from U.S. and Canadian suppliers, including Contact Exploration Inc. of Calgary, which has natural gas assets in New Brunswick.
Sorensen said about one-third of the U.S. gas shipped out of Goldboro will come from shale beds in Pennsylvania, where gas is extracted by the controversial hydraulic fracturing method, also known as fracking, which critics say threatens water supplies.
Source : thechronicleherald.ca