LNG

Squamish-based Woodfibre LNG has reached 65% completion with the arrival of its powerhouse module at site, the 16th module delivered to date. Construction is due completed in 2027.

McDermott International, the US energy and liquefied natural gas project engineering company, has reached support agreements with more than 75 percent of secured letter of credit facility providers, funded debt creditors and equity holders stemming from its several years of debt woes.

UK major BP has entered its third long-term liquefied natural gas offtake contract from the Woodfibre LNG project in the Canadian Pacific Coast province of British Columbia.

“With the additional contract to offtake 450,000 tonnes of LNG per year for 15 years on a free on-board (FOB) basis, all of the LNG production from the Woodfibre LNG export facility is now committed for sale to BP,” said the London-based company.

Woodfibre LNG is a Canadian subsidiary of the Asian group, Pacific Energy Corp. Its main offices are in Singapore and with others in Jakarta, Beijing and Hong Kong.

The latest deal takes BP’s offtake total to 1.95 million tonnes per annum and the remainder on a flexible offtake basis from the plant being built near the town of Squamish in BC.

The North American pipelines and energy company Enbridge is investing to own 30 percent of the C$5.1-billion (US$3.75Bln) Woodfibre project scheduled to enter service in 2027.

Enbridge and Pacific Energy announced that deal in July 2022. Woodfibre LNG will produce a total of 2.1 MTPA of LNG and will have 250,000 cubic metres of storage capacity.

Engineering

The project is now fully underpinned by the long-term offtake agreements with BP. Woodfibre LNG has engaged global engineering and construction company McDermott International to constructed the Woodfibre facilities.

After the latest Woodfibre deal, BP said it continued to look for opportunities across the gas value chain as it sees LNG as an essential part of the energy transition and its own pivot to becoming an integrated energy company.

“As BP works towards building an LNG portfolio of 30 million tonnes by 2030, the additional Canadian west coast supply source expands BP’s flexible, high-quality LNG portfolio and further enhances the company’s capability to meet the growing global natural gas demand,” BP explained.

In addition to securing LNG offtake rights from the project, BP added that it would provide “safe and reliable transportation of gas” to the Woodfibre LNG export facility during the 15-year contact term.

“As the world seeks secure, affordable and lower carbon energy, global demand for LNG is expected to continue to grow and this additional Canadian supply source will further enhance bp’s supply positions in the Pacific region,” said Jonathan Shepard, Vice President for Global LNG Trading and Origination at BP.

“We look forward to continuing our close collaboration with Woodfibre LNG,” stated Shepard.

Enbridge Inc., the North American pipeline and energy company with a large stake in the Woodfibre LNG export project in British Columbia, has acquired the only underground natural gas storage facilities near the Montney LNG feed-gas basin for liquefaction and export projects.

The new Chief Executive of Canadian pipeline company Enbridge Inc., Greg Ebel, has said that regulatory uncertainty in Canada had resulted in a “lost decade” for Canadian liquefied natural gas production and that US regulators also have to help projects on the Gulf Coast of Texas and Louisiana to move forward.

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.

Enbridge Inc., the Canada-based North American natural gas and oil pipeline company, said it was securing more US LNG feed-gas supply contracts but also expects Western Canada to help fill the Asian supply and for a smoother pathway to the Gulf Coast for the huge Canadian oil resources.

Woodfibre LNG, the mid-scale project near the town of Squamish in British Columbia, has issued a notice to proceed to US energy engineering contractor McDermott International.

McDermott International, the leading energy and LNG project engineering company with current LNG projects in the US, Canada, Qatar and Australia, has named Michael McKelvy as President and Chief Executive.

The company said he will also serve as a member of McDermott's Board of Directors.

Lee McIntire, who has been serving as interim CEO since June 2021, will continue as a member of McDermott's Board.

Nils Larsen, Chairman of McDermott's Board, said McKelvy was joining McDermott at a pivotal time for the company as significant contract wins reflect increasing demand for energy.

“His track record of international leadership and award-winning engineering, procurement and construction expertise will guide McDermott's talented global workforce as the momentum builds,” stated Larsen.

McDermott's current LNG contracts include among others, Qatar’s LNG expansion, Woodside Petroleum’s development of the Scarborough gas project for Pluto LNG in Western Australia and the Woodfibre project in Western Canada.

Arab Gulf

McDermott is also working on three prestigious contracts for the Saudi Arabian Oil Company (Aramco) covering four oil and natural gas fields in the Arabian Gulf.

McDermott said that McKelvy had spent more than three decades working in the engineering and construction industry across the US and international markets, including Europe and the Middle East.

He previously led Gilbane Building Company as President and CEO since 2014 where he was instrumental in record growth, profitable operations and a strong customer commitment.

“McDermott's business model and commercial strategy carve out a unique position to further capitalize on the changing industry dynamics and facilitate the energy transition,” said McKelvy.

“I am eager and enthusiastic to join this already-robust leadership team and continue their progress to strengthen the portfolio and forge a new path for the industry,” he stated.

Prior to joining Gilbane, McKelvy spent 26 years at energy consultants CH2M Hill where he held multiple leadership positions and ultimately became Chief Delivery Officer of the company.

In this position, he was responsible for project execution across all domestic and global regions with oversight of risk, safety, security, procurement and quality.

He spent his early career in operations as an architect and project manager at C.H. Guernsey & Company and Lockwood Greene, which became part of CH2M Hill.

Woodfibre LNG, the mid-scale project near the town of Squamish in British Columbia, has started hiring workers for wide range of posts as the projects development gathers pace.