While controversy and First Nations resistance have held up Enbridge’s plans for an oil pipeline across northern B.C. for export via tanker through Kitimat, there is another massive pipeline-for-export project following much the same track which is forging ahead, with relatively little notice or notoriety.
Encana, Apache Canada and EOG Resources are partners in a project to construct a natural gas pipeline to feed a huge liquefaction plant near Kitimat, to load liquefied natural gas (LNG) onto tankers for export. It is slated for opening in 2015.
An LNG spill is a nasty thing, to be sure, but not as nasty as an oil spill. That’s because natural gas is lighter than air. As the released LNG warms up, it returns to its normal state as a vapour and floats up into the atmosphere — killing anything it contacts, and potentially igniting in the process (it is not inflammable in its liquid state), but at least not leaving behind a residue in the water and on the shore for years to come.
Initially, the operation will reach a capacity to liquefy and ship 5 million metric tons of LNG per year. That’s the equivalent to 255 billion cubic feet of natural gas. Supercooling the gas turns it into a super-condense liquid. This makes it possible to liberate gas companies from the continental constraints of pipelines, and ship it via tanker anywhere in the world.
Nowadays, natural gas sells for around $4.00 per million BTUs. A barrel of oil sells for about $100, depending on the day of the week. For an apples-to-apples comparison, $4 gas is roughly equivalent to $24-per-barrel oil. Natural gas is dirt cheap because of the development of new techniques for shale gas extraction. That and the dampening of demand due to the Great Recession have produced a glut of natural gas in North America.
All that cheap gas is longing for a route to overseas markets, where gas prices compete with oil and are much, much higher. Thus there is a stupendous profit margin in exporting LNG.
It takes a lot of energy to liquefy natural gas. Almost universally, around the world, LNG plants use a portion of their own natural gas supply to provide that energy. It appears, however, that BC Hydro may be prepared to supply electricity, at B.C.’s industrial bulk energy rates to the Kitimat LNG consortium, for their liquefaction operations.
So what’s the big deal, you ask?
The Kitimat LNG plant would use about 1,600 megawatts of power to liquefy its billions of cubic feet of gas for export.
How much power is 1,600 megawatts?
About one and a half Site C dams is how much power.