TransCanada seeks pipe approval linked to Petronas LNG terminal
CALGARY, Alberta (Reuters) -- Transcanada Corp has secured shippers' commitment for a pipeline associated with Malaysian state-owned oil company Petronas' pending Pacific NorthWest liquefied natural gas terminal in western Canada and will seek early construction, the company said on Monday.
Government construction approval will allow the company to start building most of the North Montney Mainline before Petroliam Nasional Bhd, or Petronas, decides whether to commit to the project, TransCanada said in a statement.
Asked on Monday whether Petronas has given any assurances on commitment, TransCanada said North Montney is independent of Pacific NorthWest and "should not be interpreted as changing any aspect of the decision process."
North Montney was to connect producers to TransCanada's proposed Prince Rupert Gas Transmission Project to provide gas to Pacific NorthWest, as well as to existing systems for the western market, according to the company.
While the Canadian government has green-lit the $27.25 billion LNG project in northern British Columbia, majority-owner Petronas has put off a decision on whether to proceed with it.
Petronas and Pacific NorthWest did not immediately respond to requests on Monday for comment.
Canada's approval for the project came last year after a three-year wait. Analysts have been skeptical about its prospects, given current low gas prices and cost-cutting at the Malaysian oil giant.
The project has also faced opposition from environmental and aboriginal groups, some of which have sued.
Late last year, media reports said Petronas had identified a new location for the plant to cut costs and address environmental concerns. But the company has been mum about its intentions, saying only that it will study market conditions before determining its next steps.
In TransCanada's statement, it said construction will cost about $1.05 billion, and it has secured 20-year contracts with 11 shippers for approximately 1.5 million gigajoules per day of gas.
"TransCanada plans to begin construction in the first half of 2018, with facilities being phased into service over a two-year period, beginning in April 2019," the company said.
TransCanada was previously granted government approval for North Montney on condition of a positive final investment decision.
Canadian gas producers have been increasingly squeezed from the lucrative eastern market by US rivals, which have lower transportation costs and have been looking for growth in the Asian market through LNG exports.
Privately held Black Swan Energy Ltd confirmed it will be a shipper.
Reporting by Ethan Lou; Editing by Dan Grebler
The small-scale GTL (SSGTL) and small-scale LNG (SSLNG) sectors are gaining ground, providing alternative sources of power generation and transportation fuel in remote regions and areas not connected to major gas pipeline routes.
Gas Processing and Hydrocarbon Processing are pleased to announce that as of August 2017, Gas Processing will be distributed along with both Pipeline & Gas Journal and Hydrocarbon Processing.
Novatek, Russia’s largest independent natural gas producer, plans to invest up to $11 B in the large-scale Arctic LNG 2 project. The project involves the construction of an LNG plant on the Gydan Peninsula—a geographical feature of the Siberian coast of the Kara Sea.
ADIP ULTRA: ADIP-X Reimagined
View on Demand
Shell Global Solutions International BV (Shell) is launching the improved process technology ADIP ULTRA, for cost-effective removal of CO2 down to <50ppmv. The ADIP ULTRA process is applicable in gas plants, LNG, pre-NGL, refinery HMUs and gasification syngas.
•Discover how looking back at decades of ADIP and ADIP-X operational experience has led to the cost effective ADIP ULTRA process
•Understand how Shell’s new absorption column internals can further enhance process performance
•Learn how Shell is a reliable partner of choice who helps you get the most out of your unit
•An opportunity to ask questions to Shell’s technical experts
May 9, 2017 9am UTC
View on Demand