British Columbia’s oil sands
January 27, 2013
The vast quantities of natural gas discovered in B.C.‘s north-east corner represent that province’s oil sands- a vast resource that will generate untold economic wealth over a period of decades.
The Canadian Energy Research Institute (CERI) has published a comprehensive 120 page paper that explains the whole amazing story of BC possibly exporting LNG to Asia.
- Recoverable reserves in the Horn River Basin are estimated at 37 Tcf and easily rising to 50 Tcf.The Horn River Basin, according to Canadian Society for Unconventional Gas (CSUG), may contain over 500 Tcf of original gas in place (OGIP). This makes it the third largest North American natural gas accumulation discovered prior to 2010.
- The approved $1 billion Pacific Trail Pipeline (PTP) will loop the existing Pacific Northern Gas pipeline, and will connect the Spectra Energy Transmission system at Summit Lake to the proposed Kitimat LNG terminal.
- The capital-intensive nature of most liquefaction plants requires long-term contracts and high utilization rates in order to obtain a decent rate of return. As the technology has improved to build larger and larger liquefaction trains, the costs until 2003-2005 had been falling. Recently, with so many liquefaction plants proposed and being constructed the costs of building the plants have been increasing since the 2003-2005 period. For example, the Australian floating Ichthys liquefaction facility that is now slated to start in 2017 will now cost $34 billion as opposed to its 2008 estimate of $20 billion.
- Kitimat LNG has an initial planned capacity of approximately 700 MMcfpd (or approximately 5 million metric tonnes of LNG per annum). The capacity of the facility, however, can be increased to approximately 1.4 Bcfpd, or 10 mmtpa. The total cost of the project is approximately C$4.5 billion.
- BC LNG is the second LNG exporting proposal submitted to the NEB. Submitted on March 8, 2011, the smaller facility is also located in the Kitimat area and is targeting growing Asian markets for natural gas. At 0.250 Bcfpd, the BC LNG facility is much smaller than the Kitimat LNG. The cost of the terminal is estimated to be in the range of $360-450 million.
In the next few years construction activity will start and continue for BC pipeline and LNG facilities at Kitimat and Prince Rupert. The billions of dollars of investments will create a total of 944,500 jobs (person-years) in Canada, mostly in BC, according to CERI. Call it a mini-oil sands boom for British Columbia.
Source: Safety by design, http://www.kitimatlngfacility.com/Project/safety.aspx (accessed on July 22, 2012)