The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.
VANCOUVER AND CALGARY — Spectra Energy Corp. and BG Group PLC are proposing a new pipeline megaproject to carry natural gas to the British Columbia coast for export to Asian markets, making it the largest bet yet that the province’s energy riches will find a home abroad in a high-stakes race worth tens of billions of dollars.
The two companies envisage brisk demand for B.C. natural gas from customers in Japan, China and South Korea, and big potential in India and Thailand, said Doug Bloom, president of Spectra’s Western Canadian operations.
In the process, they are attempting to build a future that stands to see Canada’s westernmost province rival Alberta as Canada’s natural gas heavyweight.
“It’s British Columbia that has a massive resource base, and that’s where the bulk of the supply will come from,” Mr. Bloom said in an interview Monday in Spectra’s Vancouver office. “There are enormous amounts of domestic supply and production capability that are way in excess of domestic needs.”
Houston-based Spectra and BG of Reading, England, will be 50-50 owners in the pipeline estimated to cost up to $8-billion, with Spectra building the line and BG filling it with natural gas.
The pipeline plans serve as an insight into the size of the terminal BG is looking to construct. Based on research by CIBC World Markets Inc. earlier this year examining the cost of liquefied natural gas (LNG) terminals in Australia, such a project in Canada could cost $24-billion to $32-billion for the terminal alone, although costs between the two countries aren’t directly comparable.
The pipeline, which remains conceptual and would take years to permit and build, would connect the gas fields in northeast British Columbia with Prince Rupert, where BG has gained access to port land it believes to be suitable for construction of an export terminal for LNG.
The 850-kilometre line would be built with a capacity of 4.2 billion cubic feet per day. When it is full, the new Spectra-BG pipe will carry more natural gas than Ontario and Quebec burn today on a daily basis. The tremendous size being contemplated is the latest indication of how much gas companies believe they can extract in British Columbia and how substantial plans are for the province to become a globally significant player in gas markets.
Earlier this year, TransCanada announced plans for another pipeline, which it calls Coastal GasLink, that would initially carry up to 1.7 billion cubic feet a day of gas to Kitimat, B.C., another coastal town not far from Prince Rupert, where a series of companies have proposed new LNG terminals.
For the rest of this article, please go to the Globe and Mail website: http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/spectra-bg-make-big-pipeline-bet-in-the-race-to-bcs-coast/article4532490/