LNG

Pembina Pipeline Corp., the leading Canadian energy pipeline and midstream company with a network of gas gathering, processing and energy export terminals in North America has given a business update including spending plans and a final investment decision date for the planned Cedar LNG project in British Columbia.

The Premier of the Canadian oil and gas province of Alberta said the provincial government aimed to invoke the sovereignty act to reject Federal clean energy regulations aimed at Alberta’s gas-fired power plants.

Stonepeak, the New York-based investment firm specializing in energy infrastructure, has completed the acquisition of a 50 percent interest in the Key Access Pipeline System (KAPS), a Canadian natural gas liquids pipeline that will impact future feed-gas needs for LNG exports from Western Canada.

China’s Offshore Oil Engineering Co. (COOEC), a unit of state-owned China National Offshore Oil Corp. (CNOOC), said a vessel was enroute from Qingdao port in Shandong province to British Columbia carrying the final two modules for the LNG Canada joint venture.

Feb 24 (LNGJ) - Pembina Pipeline Corp., the Calgary-based North American pipelines and terminals operator, said in its latest earnings statement that it planned to advance the development of two “transformational projects” in Canada, the Cedar LNG project and the Alberta Carbon Grid and expected a regulatory decision soon on the Cedar joint venture.

   Pembina has formed a partnership with the Haisla First Nation to develop the Cedar LNG project on the Douglas Channel of British Columbia. “Given Cedar LNG will be a floating facility, manufactured in the controlled conditions of a shipyard, it is expected that the project will have lower construction and execution risk,” stated Pembina. The company added that the Environmental Assessment was likely to be decided on by BC Ministers as well as the federal Minister of Environment and Climate Change in the first quarter of 2023.

Kitamaat Technical Services Group (KTSG), a joint venture including the native North American Haisla First Nation and the resources of three leading industrial service companies, will be seeking to secure contracts and work in LNG projects in the western Canadian province of British Columbia.

KTSG was established by ServcoCanada, Novus Technical Services (Novus) and Well Services Group (WSG) to bring their combined expertise to emerging LNG projects in BC.

“A central tenet of KTSG is to work closely with the Kitimat community and in particular the Haisla Nation, who have occupied lands centred around Kitamaat Village for more than 9,000 years,” said KTSG.

KTSG said it was already supporting the Haisla Nation’s economic infrastructure by providing training for potential LNG supply chain jobs and would assist start-up businesses directly related to services required for contracts secured by the partnership.

Various projects

There are currently at least four LNG export projects under development in BC including LNG Canada led by Shell and the Cedar FLNG project pairing the Haisla First Nation with Calgary, Alberta-based Pembina Pipeline for the Douglas Channel project.

The Nisga’a people are behind a third project, the Ksi Lisims venture near Prince Rupert in BC in partnership with Rockies LNG Ltd and Western LNG LLC.

“The aim is to be the leading energy services organisation in BC with strong international LNG experience, supported by a balance sheet allowing major contracting opportunities to be undertaken which directly benefit the economy of North-Western British Columbia, local First Nations and the wider community,” KTSG explained.

The KTSG contracts and work venture will benefit from the experience of companies like ServcoCanada, already a well-established Kitimat-based business with a 30-year pedigree of providing electrical and instrumentation, mechanical, piping and structural and facility shutdown and maintenance services across Canada and the US.

Infrastructure

Novus is an international provider to the energy and infrastructure sectors which employs more than 10,000 staff in Canada, US, Europe, Middle East, the Caspian and China working on behalf of some of the world’s largest operators.

WSG is a process, pipeline and industrial services specialist and the leading provider of UK and European refinery and LNG terminal services with extensive experience in the Australian LNG market.

KTSG said it was actively bidding for a range of pre-commissioning, commissioning and operations and maintenance contracts on the LNG Canada project under construction at Kitimat and which when completed will export an estimated 14 million tonnes of LNG per annum.

“The LNGC project will transform Canada’s energy producing capabilities and be a major contributor to the local and national economy,” said John Gordon, a spokesman for KTSG and President and Chief Executive of ServcoCanada.

“We believe the combined resources, expertise and successful track records of KTSG’s three partner companies can play an important role in the success of this ambitious development,” explained Gordon.

“From the outset we understood the importance of working with the Haisla Nation, and that creating employment opportunities and supporting indigenous entrepreneurs who could play a role in the supply chain, was just as important as any financial benefits which may accrue,” he stated.

“We are delighted that the Haisla Nation are partners and shareholders in KTSG and we look forward to learning from their vast local knowledge and working together to create sustainable long-term opportunities for their people,” Gordon added.

A fourth LNG plant is being built further south in BC called the Woodfibre project and run by Asia’s Pacific Energy Corp.

The Woodfibre facility is being constructed about seven kilometres from the town of Squamish and 70km north of Vancouver on the brownfield site of a former mill.

This project is giving hiring priority to qualified Squamish First Nation members first, then Squamish residents followed by people from the rest of BC and Canada.

TC Energy and Pembina Pipeline, the North American energy infrastructure and LNG project companies, have entered into a carbon-sequestration evaluation agreement with the Canadian provincial government of Alberta to further evaluate one of the largest areas of interest for safely storing carbon from industrial emissions.

Pembina Pipeline Corp., the Canadian energy transportation company and joint venture partner in the Cedar Floating LNG project in British Columbia, said it had appointed former Chief Financial Officer Scott Burrows as the company's permanent President and Chief Executive and had concluded an executive search process.

A third large-scale LNG export joint venture is being considered based on previous projects discussed since 2015 and has been outlined by a First Nation representative at a council meeting in the city of Terrace located near the Skeena River in northern British Columbia.

Pembina Pipeline Corp. of Canada, the owner of the only approved LNG export project on the West Coast of the United States at Coos Bay in Oregon, has boosted its finances with an $800 million unsecured revolving credit facility.

With the addition of the credit note, Pembina now has $3.3 billion in revolving credit capacity and around $2.3Bln in available cash and unutilized debt facilities.

Pembina said the new credit line would be available for general corporate purposes, thereby providing additional liquidity and flexibility for its activities.

Pembina’s Jordan Cove LNG liquefaction and export plant in Oregon and its Pacific Connector Gas Pipeline project were approved in March 2020 by the US Federal Energy Regulatory Commission.

Pembina noted in its financial update that over the next two years, the company’s debt maturities are modest and include $73M in 2020 and $800M distributed across three instruments throughout 2021.

Calgary, Alberta-based Pembina acquired the Jordan Cove LNG project in late 2017 in its takeover of another Canadian company, Veresen Inc.

The project includes a 230-mile pipeline which would traverse four counties in Southern Oregon on the route to the liquefaction plant.

The liquefaction plant and other facilities are planned for a 200-acre site and comprise five small-scale Trains each with 1.5 million tonnes per annum of output for a total of 7.8 MTPA.

“In today's challenging and uncertain environment, ensuring ample liquidity is of utmost importance and I would like to acknowledge and thank our key lender group for their swift response,” said Scott Burrows, Pembina's Senior Vice President and Chief Financial Officer.

“We enjoy productive, long-term relationships with our lenders and value their deep understanding of our business,” added Burrows.

“Over the past two weeks we have taken decisive and unprecedented action to preserve our strong balance sheet, protect our ‘BBB’ credit rating and ensure we have the liquidity to fund our business until market conditions stabilize,” stated the CFO.

The LNG venture is only one of several North American projects Pembina is developing and they include the Prince Rupert liquefied petroleum gas export terminal on Watson Island in the Canadian Pacific Coast province of British Columbia.

That project is a rail terminal to move LPG from rail cars to ships destined for international markets.

There is no on-site processing or refrigeration, and smaller volumes for storage and movement require a smaller footprint relative to other energy facilities proposed on the West Coast.

However, Jordan Cove LNG has multiple facilities, including two full-containment storage tanks with total capacity of 320,000 cubic metres, gas treating infrastructure, an export jetty and access to more than 25 billion cubic feet per day of gas supply from Western Canada and the US Rockies.

The project’s affiliated Pacific Connector pipeline will have a 36-inch diameter with capacity to transport up to 1.2 billion cubic feet of natural gas per day.

Feed-gas for Jordan Cove would be sourced at the Malin Hub, creating a new outlet for natural gas from areas such as the Rockies Basin.

The export plant is expected to be visited by about 120 LNG carriers per year and Pembina has signed preliminary accords with Jera Co. Inc. and Itochu Corp. of Japan for the supply of cargoes.