Pacific Trail Pipelines Kitimat to Summit Lake project clears another hurdle
COMMENT: Getting approval to do something is not the same as doing something. Both the GSX Pipeline and the Duke Point Power project had approval. Seabreeze has approval to build all sorts of things - transmission systems, wind projects, hydro projects. It's not until customers are locked down and investment money can be secured, that a project might get built. Kitimat LNG is proposing an LNG export terminal which until last year was to be an LNG import terminal. The business case for the one is as specious as the business case for the other. It also needs a billion dollar, or maybe it's now a $2 billion pipeline to move the gas to Kitimat - that's this Pacific Trails project, also known as Kitimat-Summit Lake (KSL): that's what this approval is about. It needs shippers. The shippers need to find some gas, and some customers. None of those things are in place.
Last year, PNG, the partner in the KSL, had a customer company which apparently defaulted on a commitment to secure capacity to Kitimat. PNG itself is in really bad shape - severely underutilized and aging infrastructure, economic downturn everywhere along its pipeline route. Kitimat LNG is on equally dodgy footing. Late last year it announced it was seeking expressions of interest from potential customers. The deadline was three months ago, yet from the company ... silence. Must be some very unhappy investors in Kitimat LNG, I suspect.
See:
LNG Partners does not make payment to PNG
KLNG puts call out for potential clients
The Canadian Press
March 24, 2009
VANCOUVER, B.C. - Pacific Trail Pipelines Limited Partnership said Monday that its proposed Kitimat to Summit Lake Pipeline Looping Project as cleared another hurdle.
The company said a decision under the Canadian Environmental Assessment Act has found that, with appropriate mitigation measures, the project is "not likely to cause significant adverse environmental effects."
"The receipt of the decision marks the next major milestone in the development of the KSL Project following the receipt of the B.C. Environmental Assessment Authority environmental certificate last year," the company said in a statement.
The project includes the construction of 463 kilometres of pipeline and compression facilities to allow the transportation of up to one billion cubic feet per day of natural gas from Summit Lake to Kitimat LNG Inc.'s proposed liquefied natural gas.
PTP is a partnership between Pacific Northern Gas Ltd. (TSX:PNG) and Galveston LNG Inc., the parent company of Kitimat LNG Inc.
British Columbia LNG project gets green light
Cowan Thant ZinPortworld News
24th March 2009
 Some 463 km of pipeline to be laid |
The west coast of Canada could soon have a loading terminal for LNG carriers at Kitimat in north-western British Columbia.
Pacific Trail Pipelines (PTP) had proposed a pipeline project to move up to 1 billion ft³ per day of natural gas from Summit Lake to Kitimat LNG Inc's proposed LNG export terminal in Kitimat.
The Kitimat to Summit Lake Pipeline Looping Project (KLS Project) needs approval under the Canadian Environmental Assessment Act before it can move along.
Federal authorities last week issued a go-ahead decision, saying that “with appropriate mitigation measures”, the project “is not likely to cause significant adverse environmental effects”.
“The receipt of the decision marks the next major milestone in the development of the KSL Project following the receipt of the B.C. Environmental Assessment Authority environmental certificate last year,” said PTP.
The KSL Project entails the construction of approximately 463 kilometres of 36 inch diameter pipeline and compression facilities.
The Kitimat terminal is slated to have facilities for storage, loading, delivery and liquefaction.
According to a press release, PTP, a 50/50 partnership between Pacific Northern Gas Ltd. and Galveston LNG Inc., the parent company of Kitimat LNG Inc., was formed for the purpose of developing the KSL Project.
Greg Weeres, vice president operations and engineering for Pacific Northern Gas said,"We are very pleased to have these major environmental approval processes completed successfully and look forward to delivering the many potential benefits this project would bring to our existing customers, to First Nations located in the Summit Lake to Kitimat area and to our shareholders.”
According to PTP, Kitimat LNG Inc. has already received provincial and federal permits and certificates for the construction and operation of the terminal.
According to another source, Mitsubishi has tentatively agreed to buy 1.5 million tonnes per year of terminal capacity and acquire a minority equity interest in the terminal.
PTP says its company mission is "moving natural gas from Western Canada to Asian markets."