Calgary — Halifax-based Nova Scotia LNG is planning to build two small LNG facilities in the Atlantic Canadian province with a total capacity of 180,000-260,000 mt/year, its director Dean Girdis said Friday.
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A 30,000-60,000 mt/year plant and another 150,000-200,000 mt/year project will be constructed, with the former targeting bunkering demand along the US and Canadian East Coast and the latter facility being more focused on diesel displacement markets in the Caribbean, he said in an email.
Nova Scotia LNG is developing the facilities under a partnership with Nitrogas, a specialized LNG/LPG broker with maritime expertise, Girdis said, noting it will develop a tolling facility with gas liquefaction charges of $3.50/MMBtu to $5/MMBtu.
"We don't see the higher charge as an obstacle, given we are targeting diesel displacement and not existing LNG markets where we would be at a disadvantage," he said.
Nova Scotia LNG has optioned a site from the provincial government, he said, that was once identified by ExxonMobil (then Mobil Oil) for its own planned LNG export facility.
"We are beginning the permitting the process this spring and would file an application with the Nova Scotia government," he said, adding an export license will also be sought from the federal regulator, the National Energy Board.
Girdis did not specify the timeline for filing regulator applications with the provincial government and the NEB, but added the bunkering plant is targeted for startup in 2017, while the other facility will be commissioned a year or two later.
"We are considering primarily land-based designs [for the projects], but our site could also employ floating liquefaction technology. We have had discussions and have [received] initial bids from liquefaction technology providers," Girdis said.
The company will utilize LNG carriers with a capacity of 10,000 cu m to 25,000 cu m to send cargoes to the Caribbean, while for bunkering "we would have the ability to dock ships directly at our berth for refueling."
Prime reasons for Nova Scotia LNG deciding to build its facility in the province, rather than the US East Coast, include ease of permitting, access to offshore gas in Atlantic Canada and support from stakeholders, he said.
A small-scale plant can be permitted in about nine months in Nova Scotia at a cost that is a fraction of a US based plant, he said. In comparison, a US Federal Energy Regulatory Commission-permitted LNG export facility, no matter the size, will cost at least $30 million for engineering and permitting costs and the regulatory process will typically take three to four years for a greenfield project, he said.
The two projects will need a total of 24 MMcf/d of feedstock gas, to be sourced from offshore Nova Scotia, which has an output of 250 MMcf/d, he said.
"If required, we [also] have access to the Maritimes pipeline from where we could source Canadian gas from Quebec," Girdis said.