BG Group's BC LNG Export Project Names Spectra Pipeline, Asian Customers, NGI Reports

DULLES, Va.--()--BG Group has rearranged the natural gas pecking order in the Canadian Northwest, filing with the National Energy Board (NEB) for a liquefied natural gas (LNG) export license which reveals its choice of Spectra Energy's (Westcoast) jumbo pipeline as its supply line over a TransCanada Corp. rival, along with an expansive roster of Asian customers.

The Spectra pipeline project is virtually the same as one proposed by TransCanada. Both would lay large diameter pipe across 500 miles of northern Canadian wilderness to carry about 3 Bcf/d from the prolific Horn River and Montney shale basins and others to the British Columbia (BC) coast, according to a report in NGI’s Daily Gas Price Index.

And as for customers, it's no problem if you market to the world. "In terms of LNG sales, BG Group has large-scale, long-term LNG sales contracts with major buyers in the key LNG markets of Japan, China, India and Chile," BG's Prince Rupert project description says.

"BG Group's contracts with China, at 8.6 million tonnes per year [mmt/y] in total, will make it the largest supplier to this market. BG Group is also the supply aggregator for the Singapore market with exclusivity over the first 3 mmt/y imported." BG describes the northern Canadian project as an addition to its current supply and sales portfolio as one of the world's top LNG merchants and transporters.

In the new export license application filed at the National Energy Board (NEB), the United Kingdom-based BG Group confirms that its Pacific Coast liquefaction plant and tanker dock construction project, called Prince Rupert LNG, rely on the Spectra pipeline. A preliminary description of the pipeline proposal has been deposited at the federal Canadian Environmental Assessment Agency (CEAA) and its provincial BC counterpart.

The BG application arrived at the NEB less than three weeks after a TransCanada subsidiary, Prince Rupert Gas Transmission LP, submitted a similar preliminary BC pipeline project description to the CEAA. The TransCanada proposal supports the Pacific Northwest LNG Project, an export scheme under development by Calgary-based Progress Energy and its new owner, Malaysian state gas and oil conglomerate Petronas.

The pipeline proposals do not mention each other and are not officially competitors, just as the current nine entries in the BC LNG export project lineup portray themselves as a budding industrial sector for harvesting vast northern shale gas deposits instead of rivals for limited markets or supplies (see Daily GPI, April 12). Plans to move gas across the Canadian Rockies and signing up customers are essentials for financing of the billion dollar projects and picking the winner(s).

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Intelligence Press, Inc., is an independent publishing company serving the energy industry since 1981 with real-time news and price survey reports for the natural gas market in its publications: Natural Gas Intelligence, Daily Gas Price Index, Weekly Gas Price Index. Its new publication, NGI's Shale Daily at http://shaledaily.com/ is the first daily publication devoted exclusively to the unfolding shale revolution that is rewriting the energy outlook in North America.

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Intelligence Press, Inc.
James Geanakos, 703-318-8848
James@intelligencepress.com

Release Summary

BG Group now on top of the Canadian Northwest, filing with the National Energy Board (NEB) for a liquefied natural gas (LNG) export and chooses of Spectra Energy's pipeline over TransCanada

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Contacts

Intelligence Press, Inc.
James Geanakos, 703-318-8848
James@intelligencepress.com