WestPac LNG Corp. on Tuesday announced a $2.0 billion combined liquefied natural gas (LNG) import terminal and natural gas-fired power generation facility that signals an important shift in its strategy to meet the future energy needs of British Columbia coastal and Vancouver Island residents.
"We believe LNG offers significant benefits to the people of BC and we have a unique
opportunity to enhance these benefits by adding power generation at our proposed LNG
terminal on Texada Island," said Mark Butler, president of WestPac. "The existing natural gas and power infrastructure on Texada and the opportunity of a power generation facility make a strong business case."
The Texada LNG facility will provide benefits to BC and coastal region residents including:
- new stable, secure supply of natural gas;
- provision of LNG as a clean-burning fuel option for vehicle fleets and remote BC
- additional energy opportunities without the need for significant new pipeline or
transmission line construction;
- enabling the possible decommissioning of the Burrard Thermal power station and
provision of alternate electricity supply from a new highly efficient facility away from
densely populated areas;
- alleviation of BC power deficit and enhancing electricity self-sufficiency; and
- up to 75 full time jobs and more than 300 jobs during construction.
"Natural gas is a key component for meeting today's growing power and energy demand. Together with the power generation plant, LNG will play an important role as part of the solution to BC's current and forecast power deficit," Butler said.
WestPac has acquired a long-term lease at Kiddie Point, at the north end of Texada Island. Located in an industrial area adjacent to an existing limestone quarry, the site can provide a safe, deepwater berth for LNG vessels as well as access to existing energy infrastructure, such as the Vancouver Island gas pipeline onsite and nearby connection to BC Hydro's power grid through the existing power line crossing Texada Island and supplying electricity to Vancouver Island. Because this infrastructure is already in place, the proposed site is ideal for providing power generation and a secure source for natural gas with minimal environmental impact.
"When built, our terminal will provide the coast, Vancouver Island and the Lower Mainland with access to a reliable supply of natural gas that should contribute to future economic development and power possibilities in the region," said Butler.
The project supports the goals expressed in BC's Energy Policy, by contributing to provincial electricity self-sufficiency and by enabling wind, run-of-river hydro and other renewable power sources. This is accomplished by providing power at times when intermittent solutions such as run-of-river or wind-generated power are not available ("firming").
Facilities at the Texada site will include
- a marine jetty and berthing facility
- onshore LNG storage tanks
- a natural gas-fired power generation facility
- interconnection with the existing Terasen natural gas pipeline from the mainland to
Vancouver Island on site
- a short 500 kiloVolt interconnection line to the existing BC Hydro transmission line
between the mainland and Vancouver Island.
WestPac has conducted preliminary meetings with local community representatives to
outline its strategy to support existing industry and enable future economic development in the BC coastal region.
An in-depth analysis of the LNG terminal and power generation facility will be undertaken through detailed environmental assessment and regulatory reviews of the project. The proposed terminal will be designed and constructed to Canadian and international standards for LNG facilities and there will be an extensive public consultation process.
"We will actively consult the community and are committed to treat any concerns with thoughtful regard and consideration," added Butler.
The Texada Island Project could also enhance air quality in the Fraser Valley by allowing
BC Hydro to decommission its Burrard Thermal power generator, which it currently depends on for peak-demand power supply.
"The new facility will help meet future demand for natural gas in BC at a time when gas
reserves are decreasing and power costs are increasing," said WestPac Board member
Geoff Plant. "We hope the BC government will agree that we will offer new and flexible
energy options for the province by allowing power generation using natural gas that can be imported economically."
Declining production of natural gas in Canada and the US, combined with a rapidly
increasing demand for clean-burning, environmentally acceptable natural gas, has led to
growing demand for natural gas imports. LNG is safely transported in specially insulated
double-hulled vessels and pumped into full containment storage tanks on land for later
regasification and delivery to consumers, business and for power generation. WestPac
expects that about one LNG vessel will deliver LNG to Texada Island every 10 days for regasification and distribution through the existing natural gas pipeline system.
LNG facilities are not new to British Columbia. An LNG production and storage facility has operated on Tilbury Island in Delta since 1971 without incident. An LNG receipt terminal proposed to be located near Kitimat, BC recently received environmental approvals. In addition, four other proposed LNG receipt terminals have been approved elsewhere in Canada within the last three years.
WestPac has been conducting environmental assessment work for a proposed LNG receipt and transshipment terminal at Ridley Island location near Prince Rupert. While the Ridley facility will not proceed immediately, Butler said the location could still play a future role as a second terminus to serve the north coast when demand for natural gas reaches new levels.
Liquefied natural gas is created by cooling natural gas into a liquid state at a temperature of minus 162C. This reduces the space natural gas occupies by 600 times, making it practical for transport and storage. LNG has been safely transported by ship, truck and rail car for more than 50 years. More than 33,000 ship cargos of LNG have been safely transported over a combined distance of 60 million miles without serious incident. Annually, more than 150 ocean tankers safely transport more than 110 million tonnes of LNG, a volume greater than all natural gas consumed in American homes each year.