A major energy project in British Columbia is undergoing a rigorous internal review, reconsidering ideas previously discarded.
Pacific NorthWest LNG is looking at lower-cost options as it mulls whether to spend billions of dollars to build a liquefied natural gas terminal in B.C. amid a global glut of LNG.
The consortium – led by Malaysia’s state-owned Petronas – still favours building a suspension bridge and pier to connect with a planned dock in Agnew Bank but is re-examining a tunnelling option in a different area.
In September, the federal Liberal cabinet approved construction of an $11.4-billion terminal on Lelu Island to export liquefied natural gas from B.C.
Pacific NorthWest LNG decided in 2014 that the suspension bridge and trestle-supported pier, estimated to cost $1-billion, would be the best solution to address environmental concerns about Flora Bank.
The sandy reef-like area visible at low tide next to Lelu Island that contains eelgrass beds that are crucial to the survival of juvenile salmon in the Skeena River estuary.
The consortium views the suspension bridge and pier over the northwest flank of Flora Bank as the “base case” that remains the best option so far, especially since those plans have been approved by the Canadian Environmental Assessment Agency.
“The base case remains the primary objective but it would be irresponsible not to look at other options,” a source familiar with the project said Wednesday, after Bloomberg News reported that Pacific NorthWest LNG is revisiting the Ridley Island option for docking facilities.
Pacific NorthWest LNG had considered an option that would have tunnelled under Porpoise Channel, from the planned Lelu Island terminal to nearby Ridley Island, said a study prepared by engineering firm Stantec Inc. in 2014.
The Petronas-led consortium later ruled out that option, which would have involved building a trestle carrying an LNG pipeline from Ridley Island to Chatham Sound.
Spencer Sproule, Pacific NorthWest LNG’s senior adviser of corporate affairs, said Petronas and its Asian partners will be “conducting a total project review over the coming months.”
Using Ridley Island is fraught with complications. Both Ridley Island and Lelu Island are federal Crown properties that are administered by the Port of Prince Rupert. Pacific NorthWest LNG would need permission from the federal port authority if it devises new plans involving Ridley Island.
Royal Dutch Shell PLC holds the LNG development rights for a large parcel of land on Ridley Island.
The federal Liberal cabinet’s approval of Pacific NorthWest LNG is subject to the project’s co-owners meeting an array of conditions designed to reduce the proposal’s environmental footprint.
“The Canadian Environmental Assessment Agency has not received any information from Petronas on any potential changes to the Pacific Northwest LNG project,” CEAA said Wednesday.
If Pacific NorthWest LNG were to seriously pursue the Ridley Island option, it would delay any final investment decision. But under the base case, that decision is expected as early as the summer of 2017, possibly three months after the May 9 B.C. election.
“Pacific NorthWest LNG has told us that since the federal approval, they have been working with area First Nations, stakeholders and regulators to move the project forward in a competitive manner. We anticipate the company to make a decision in the summer of 2017,” B.C. Deputy Premier Rich Coleman said in a statement.
A group of aboriginals has occupied Lelu Island in rotating shifts since August, 2015.
Two of the camp’s aboriginal backers are tribal chief Donnie Wesley and house leader Ken Lawson. They are hereditary leaders of the Gitwilgyoots, one of nine allied tribes of the Lax Kw’alaams.
They are worried about the potential impact that building an export terminal will have on juvenile salmon habitat in Flora Bank.
“They can’t just flick a switch and say we want to move the dock’s location without doing any scientific work,” said Joey Wesley, a Gitwilgyoots member and one of Donnie Wesley’s sons. “The terminal would remain on Lelu Island, so my feelings still haven’t changed.”
Supporters of the protest camp are opposed to development on Lelu Island and Flora Bank, saying demonstrators are exercising their aboriginal rights and are entitled to stay put.
Pacific NorthWest LNG envisages constructing the 1.6-kilometre-long suspension bridge to carry a pipeline beginning on Lelu Island and extending over the northwest flank of Flora Bank. That bridge would connect with a 1.1-kilometre pier that is slated to stretch to a marine terminal for ocean-going LNG tankers.Report Typo/Error