Woodfibre LNG
Earlier this month, Woodfibre LNG became the first Canadian liquefied natural gas (LNG) project to receive a Final Investment Decision (FID) to build an LNG export facility. The Woodfibre LNG terminal will be located on the north side of Howe Sound, near Squamish, British Columbia, 30 miles north of Vancouver. The project sponsor, Pacific Oil and Gas, a wholly-owned subsidiary of Singapore-based Royal Golden Eagle, expects to begin construction in 2017 and start LNG exports in 2020.
Woodfibre LNG is a relatively small project (0.3 billion cubic feet per day (Bcf/d)) compared with other liquefaction projects proposed in Western Canada. Unlike other proposed LNG export projects in Western Canada, Woodfibre LNG does not include upstream acreage in emerging unconventional plays. The project will be supplied by natural gas from the existing market hubs near Vancouver sourced from the Western Canadian Sedimentary Basin, and transported south via Spectra's British Columbia 2.9 Bcf/d mainline, connected to the FortisBC pipeline grid.
Woodfibre LNG has secured a 25-year export license from the Canadian National Energy Board (NEB) and environmental permits from the British Columbia (BC) Environmental Assessment Office and the Canadian Environmental Assessment Agency. The project still needs permits from British Columbia's Oil and Gas Commission and the District of Squamish. In line with BC's Climate Leadership Plan Initiative, this facility will use only electricity (not natural gas) for its operational fuel needs, most of which will be sourced from hydropower.
The Woodfibre LNG project sponsors have signed two preliminary non-binding offtake supply agreements so far—one with a Chinese natural gas distribution company, Guangzhou Gas Group, to supply 0.13 Bcf/d for 25 years starting in 2020, and another with Beijing Gas Group with undisclosed terms.
The small size and minimal infrastructure requirements of Woodfibre LNG may facilitate rapid development of the project. As of November 2016, 32 proposed liquefaction projects in Canada secured export licenses from the NEB, with several of these projects also obtaining federal and provincial environmental permits, but only Woodfibre LNG has reached a FID.
