LNG

Pembina Pipeline Corp., the Canadian natural gas and energy transportation and terminals company, and its Cedar floating LNG partner, the Haisla Nation of British Columbia, have reached landmark deals on LNG offtake, construction and financing.

TC Energy Corp., whose current ventures include the building of pipelines in the US, Mexico and Canada, said it had made “monumental progress” on the Coastal GasLink in British Columbia linking gas fields to the Shell-led LNG Canada venture and had achieved mechanical completion ahead of the year-end target.

The update came in its earnings as TC Energy reported a quarterly net loss of C$197 million (US$143M) versus a C$841M (US$612M) net profit in the same three months of 2022.

This was largely due to the after-tax impairment charge of C$1.18Bln (US$858M) for the three months to the ended of September 2023 related to TC Energy's equity investment in Coastal GasLink Pipeline partnership project company.

Calgary, Alberta-based TC Energy reported that net income for the nine months from January to September because of the impairment had dropped to C$1.36Bln from C$2.08Bln in the previous year.

“The team’s exceptional safety and construction execution on this challenging project means that we have reached 100 percent pipeline installation, including the successful hydrotesting of the full 670km (Coastal GasLink) pipeline length,” said François Poirier, TC Energy’s President and Chief Executive.

On track

“The project remains on track with the approximately C$14.5Bln cost estimate,” added Poirier.

TC Energy’s five divisions include Canadian Natural Gas Pipelines, US Natural Gas Pipeline, Mexican Natural gas Pipeline, Liquids Pipeline and Energy and Power Solutions.

“We are also delivering on our 2023 strategic priorities, including strengthening the balance sheet with the recent receipt of C$5.3Bln of asset sale proceeds that will be utilized for debt repayment and funding, along with maximizing the value of our assets with the announced intention to spin-off our Liquids Pipelines business,” the CEO explained.

At the start of October 2023 TC Energy completed the sale of 40 percent stakes for a total of C$5.3 billion (US$3.9Bln) in two US assets, Columbia Gas Transmission and Columbia Gulf Transmission, transporters of 20 percent of US LNG feed-gas volumes.

The Calgary, Alberta-based company confirmed that the Columbia Gas and Columbia Gulf stakes was completed to the buyer, the New York-headquartered asset management firm Global Infrastructure Partners (GIP).

US natural gas

The Canadian company described GIP as a “strong and reputable strategic and financial partner” that would help it unlock incremental value on the Columbia gas systems.

The Columbia Gas and Columbia Gulf pipelines span more than 15,000 miles across the North American natural gas network and are underpinned by strong long-term natural gas supplies and a rate-regulated commercial framework.

The company noted in its earnings highlights that quarterly US Gas Pipeline net profits rose to C$782M from C$714M and in the nine months to C$2.57Bln from C$1.73Bln because of US LNG feed-gas deliveries.

TC Energy said that US Natural Gas Pipelines LNG deliveries in the third quarter averaged 3.1 billion cubic feet per day, an increase from the third quarter of 2022.

The US Pipelines division also achieved a new record of deliveries to power generators of 5.2 Bcf on July 28, 2023.

TC Energy said that it delivered approximately 7 percent comparable gross earnings (EBITDA) growth of C$2.6Bln in the third quarter compared with $2.5Bn in the same three months of 2022.

Canada and Mexico

Nova Gas Transmission Ltd. (NGTL), TC Energy’s natural gas gathering and transportation system for the Western Canadian Sedimentary Basin connecting most of the natural gas production in western Canada to domestic and export markets, saw receipts average 14.0 Bcf per day, up 0.5 Bcf/d from the third quarter 2022.

NGTL System daily receipts reached 14.6 Bcf on August 6, 2023, the highest single day average on the pipeline.

TC Energy was also making progress together with Mexico’s Federal Electricity Commission (CFE) on the Southeast Gateway Project.

This consists of the construction of a marine pipeline that will transport natural gas, connecting the supply from Tuxpan, Veracruz, to delivery points in Coatzacoalcos, Veracruz and in Paraíso in Tabasco state.

“The Southeast Gateway Pipeline project continues to progress with its US$4.5Bln cost estimate and schedule,” said the company.

“Land rights and rights of way negotiations have closed and all critical permits for onshore construction have been received. We are advancing construction of onshore facilities and landfalls,” said the company.

“Offshore engineering is complete and offshore installation expected to commence prior to the end of 2023,” it added

In other Mexican projects, TC Energy placed the lateral section of the Villa de Reyes (VdR) pipeline into commercial service.

TC Energy also successfully completed two open seasons on Marketlink, supporting the sustained demand for Canadian crude on the Keystone Pipeline and Marketlink systems.

TC Energy Corp., whose current projects include the building of the Coastal GasLink pipeline for LNG Canada, has completed the sale of 40 percent stakes for a total of C$5.3 billion (US$3.9Bln) in two US assets, Columbia Gas Transmission and Columbia Gulf Transmission, transporters of 20 percent of US LNG feed-gas volumes.

May 12 (LNGJ) - Pembina Pipeline Corp., the Canadian operator of a network of natural gas and liquids, gas-gathering and processing facilities as well as owning a stake in the Cedar LNG project in British Columbia, has provided an update on operational impacts of wildfires that flared in the past week in the provinces of BC and Alberta.

   “All Pembina facilities previously shut down due to the wildfires have resumed operations. To date, Pembina is not aware of any material damage to its assets. We remain committed to ensuring the safety of our workers and impacted communities,” said Pembina. “Pembina extends its sincere thanks to our staff and emergency response teams, customers, and industry partners, as well as all emergency personnel responding to the wildfires” the company added.

TC Energy Corp., the Canadian natural gas pipeline company, reported strong four-quarter results from US and Mexican activities, though posted a huge quarterly impairment charge related to the rising costs of the Coastal GasLink pipeline for LNG Canada and this meant a quarterly loss.

TC Energy Corp. reported a fall in quarterly net income, though revealed a long-awaited settlement with the Shell-led LNG Canada project of a dispute over a revised schedule for the Coastal GasLink pipeline because of disruptions caused by Covid-19 and other issues.

TC Energy also said in its earnings statement that the Coastal GasLink from the Montney Shale Basin in northeast British Columbia to the Pacific Coast for the LNG Canada project at Kitimat was now about 70 percent complete.

The company said second-quarter net income dropped to C$889 million (US$691M) compared with C$975M in the second quarter of 2021.

“Our revised agreements with LNG Canada establish a better framework for project advancement and further strengthen our long-term partnership,” said TC Energy.

“The agreements resolve uncertainty over specific and anticipated costs, mitigate project funding and execution risks and allow us to continue the safe and timely execution of the project,” it added.

While net income dropped, gross earnings from its pipeline businesses in the US, Canada and Mexico and power and storage units increased to C$2.37 billion from C$2.24Bln in the prior-year quarter.

“Through the first six months of 2022, we have delivered strong results reflecting the high utilization we continue to see across our entire system,” said TC Energy's President and Chief Executive François Poirier.

“Demand for clean, responsibly sourced natural gas remains high in North America, with energy security also driving incremental growth in the global LNG market,” added the CEO.

Back on track

“I am pleased to report we have reached a significant milestone with the Coastal GasLink Limited Partnership (Coastal GasLink LP), signing revised agreements with LNG Canada that will allow the safe and timely execution of our largest LNG-linked project,” explained Poirier.

“The 670-kilometre Coastal GasLink project is approximately 70 percent complete, with mechanical in-service expected by the end of 2023,” he stated.

The company said the Wilde Lake compressor facility near Chetwynd at the eastern end of the route was also nearing completion, representing one of the most significant pieces of infrastructure on the project.

Together with LNG Canada, the 2.1 Bcf per day pipeline will provide the first direct path for Western Canadian natural gas to reach global LNG markets in Asia and displace coal-fired power.

The Calgary, Alberta-based company stated that it also continued to deliver around a quarter of volumes destined for export from US LNG liquefaction plants through its US Natural Gas Pipelines and advanced 3.3 billion cubic feet per day of additional projects during the first six months of 2022.

Its US Natural Gas Pipelines flows averaged 25.4 Bcf per day, up over 3 percent, compared with the second quarter of 2021.

“By leveraging our competitive strengths, we continue to develop solutions to move, generate and store the energy North America relies on in a secure and increasingly sustainable way,” the CEO concluded.

Police in the Canadian province of British Columbia said environmental extremists have carried out a violent attack on a project site of the Coastal GasLink LNG feed-gas pipeline for LNG Canada.

TC Energy Corp., one of the leading natural gas pipeline operators for LNG feed gas and exports to Mexico, is claiming over US$15 billion in damages under the legacy North American Free Trade Agreement (NAFTA) against the Biden Administration for cancelling the Keystone XL oil pipeline project.

TC Energy has filed a Notice of Intent to initiate a NAFTA claim under the United States-Mexico-Canada Agreement to recover economic damages resulting from the revocation of the Keystone XL project’s Presidential Permit first awarded by previous President Donald Trump.

“TC Energy will be seeking to recover more than US$15 billion in damages that it has suffered as a result of the US Government’s breach of its NAFTA obligations,” stated the Calgary, Alberta-based company.

TC Energy said that the Notice of Intent has been filed with the US Department of State’s legal office.

The company’s shares rose to C$61.64 (US$49.70) per share on the Toronto Stock Exchange after the damages claim was filed at the start of the weekend when the USA celebrates Independence Day on July 4.

The Canadian company was following up on a decision by the US to end the Keystone XL pipeline without warning and by presidential decree in January 2021 under the anti-hydrocarbon policies of the Biden Administration.

The 1,947km (1,210-mile) Keystone XL pipeline was designed to deliver 830,000 barrels per day of crude oil from Hardisty in the Canadian province of Alberta to the US state of Nebraska.

It would then have connected with existing facilities to reach US Gulf Coast refiners to meet critical needs for transportation fuel and manufactured products. Keystone XL had been expected to be placed into service in 2023.

TC Energy’s priority project is now likely to be the Canadian Coastal GasLink pipeline to bring feed-gas from the prolific Montney Shale basin in northeast British Columbia to the town of Kitimat on the province’s Pacific Coast.

The pipeline will supply the LNG Canada joint venture led by Royal Dutch Shell and will have a second customer in the form of the Cedar LNG plant to be constructed by the local Haisla First Nation and Pembina Pipeline Corp. on Haisla traditional territory near the Douglas Channel.

Analysts note that TC Energy has made huge investments over the years that have enabled the provision of vital energy to the US, Canada and Mexico.

It partnered with IEnova, the Mexican infrastructure company of Sempra Energy, to construct the South Texas-Tuxpan Pipeline running almost entirely under the Gulf of Mexico for 800 kilometres (497 mile) to deliver clean-burning natural gas to homes and businesses in the southeast Mexican state of Veracruz.

The pipeline was completed in 2019 and has 2.6 billion cubic feet per day of capacity.

Its natural gas comes via the Valley Crossing Pipeline on the US side of the border.

TC Energy, the North American pipeline company, said it was working with the Royal Dutch Shell-led LNG Canada project on a revised timetable and budget because of Covid-19 delays while boosting US Gulf Coast LNG feed-gas supplies as it posted first-quarter losses after the cancellation of the Keystone XL oil pipeline.

LNG Canada, the largest current global liquefaction and export joint venture under construction, is aiming to get back on schedule for a 2025 commercial start-up after work interruptions caused by the Covid-19 pandemic at the site near the town of Kitimat on the Pacific Coast of British Columbia.