Terasen gas plant project still alive

Edward Hill
Ladysmith Chronicle
Aug 23 2005

A natural gas storage facility north of Ladysmith is still in the works, says Terasen Gas, despite the demise of the Duke Point power project and Terasen's recent takeover by a Texas energy company.

Carol Greaves, Terasen's community relations manager, said the company will re-start the approval process with the B.C. Utilities Commission within the next several months. The BCUC previously gave the go-ahead in February, predicated on supplying gas to a 252-megawatt power plant, which BC Hydro abandoned in June.

Greaves said Terasen is still calculating the economics of building a $100-million liquid natural gas (LNG) facility, but suggested its construction is likely.

"It depends on projected use. The facility will offer a flexible source to store gas. We will buy it in the summer when prices are lower, and draw from it in the winter when demand is greater," Greaves said. "It will contribute to stabilizing prices."

Houston-based Kinder Morgan, which operates pipelines within North America, took control of Terasen Aug. 1 for $6.9 billion. Kinder Morgan was primarily interested in Terasen's Alberta oilsands pipeline network.

Greaves said for B.C. customers and projects, "it's business as usual. Nothing is going to change."

LNG storage is slated for construction about six kilometres northwest of Ladysmith near Mt. Hayes, on 12 hectares of a 42-hectare parcel owned by Terasen. The Cowichan Valley Regional District granted the LNG storage environmental certification and zoning approval last year.

The tank will be massive, 60 metres in diameter and 55 metres high, holding up to 30 million cubic metres of LNG. Natural gas is stored in a liquid state at -162 degrees Celsius, which reduces its gaseous volume by a factor of 600, but makes it a dangerous substance to humans.

Should the tank ever rupture, from an earthquake or otherwise, the plan calls for an earthen dike that holds the same volume as the tank.

In June, at about the same time the Duke Point project died, Terasen entered into an agreement with the with the Chemainus First Nation and Cowichan Tribes' Khowutzun Development Corporation.

"The project might affect [Chemainus First Nation] land," Greaves said. "We want them to help with site prep work."

If the project gets the nod from the BCUC, Chemainus members have been guaranteed contracts for site road construction, land clearing and pipeline installation, among other jobs.