Nova Scotia LNG project feels it can proceed with 14 Canadian and US permits
Monday, 08 February 2016
The Bear Head liquefied natural gas export project in the Canadian Atlantic coast province of Nova Scotia has become the most permitted LNG venture in the western world, with 10 permits from Canada and two from the US and only the federal government in Ottawa could now stand in its way.
The US Department of Energy issued the final necessary permit when it said that feed-gas derived from US pipeline imports can be sold to countries that don't even have a free trade agreement (FTA) with the US.
The Bear Head LNG project is located on Nova Scotia's Strait of Canso near Port Hawkesbury on a site permitted and partially developed a decade ago.
The liquefaction plant will process 8 million tonnes per annum from the facility which the developers point out is about half the shipping distance to major European markets compared with US Gulf Coast ports.
The Bear Head venture is being developed by Australian company LNG Ltd, also responsible for a similar-sized project in the US state of Louisiana.
The Nova Scotia venture now has both US DoE's authorization to re-export LNG made from US feed-gas to both FTA and non-FTA countries.
The US decision is a determination that these exports are not inconsistent with the US public interest.
The Nova Scotia venture now has the US export permits in addition to the 10 initial Canadian federal, provincial and local regulatory approvals needed to commence project construction, including the Canadian National Energy Board authorization to export up to 12 MTPA of LNG, the natural gas equivalent of around 1.8 billion cubic feet per day of naural gas.
Additionally, Bear Head has been placed on the list of approved North American LNG Export Terminals by the US Federal Energy Regulatory Commission.
Analysts said one possible remaining hurdle for the project is the new Liberal government of Prime Minister Justin Trudeau.
The Ottawa government is seeking an overhaul of Canada's permit process for energy projects, with the federal cabinet saying it would have a veto on any project the does not fulfil its as yet undefined aims as regards leading the world on halting climate change. "Bear Head LNG is appreciative of the cooperation between the US and Canada in working out key energy regulatory issues," said Bear Head LNG President Maurice Brand, who is also Chief Executive of Australian parent company LNG Ltd.
"
Bear Head LNG is the first and only proposed Canadian LNG export facility to receive both the non-FTA authority from the DoE and all the initial regulatory approvals to commence project construction," the company said. Brand said his Nova Scotia venture was currently negotiating for feed-gas supplies from Western and Central Canada, from offshore Nova Scotia and from the abundant supplies available in the US.
"With the DoE's non-FTA export approval, we are able to continue forward on US gas production as the third leg of our gas supply portfolio," said Brand.
Bear Head LNG's Project Director John Godbold said that prompt action by the US that gave both permits after only 12 months "was a tribute to the productive and open pre-filing discussions with DoE, coordination between the US and Canadian governments and Bear Head's submittal of an extremely robust application."
Godbold noted that only two minor comments were received during the public comment period, further confirming the quality of the application and studies provided.
In tandem with the non-FTA export permit, the US DoE determined that Bear Head LNG does not require DoE authorization for Canadian natural gas to pass through US pipelines (in transit) on its way to the export facility in Nova Scotia.
Godbold said this outcome enhances Bear Head's commercial gas supply options by allowing a portion of supply requirements to come from Western and Central Canada largely using existing pipeline facilities.
The Bear Head project previously said the front-end engineering and design work was being carried out by Houston, Texas-based engineering and construction company KBR.
KBR has knowledge of the local Bear Head site since it carried out the initial engineering work when the facility was first proposed as an LNG import terminal rather than an export plant before the shale-gas boom.
The US company is also the lead engineer for the LNG Ltd. Magnolia plant in Louisiana that will also produce at least 8 MTPA of LNG when completed.
