A dream of reviving a mining ghost town with liquefied natural gas (LNG) has pumped up the total of Canadian supplies hunting with 20- to 40-year export licenses for overseas sales to 50 Bcf/d.
The National Energy Board (NEB) authorized Kitsault Energy Ltd. to ship out up to 22.7 Tcf over two decades at a rate of 2.7 Bcf/d. The firm is named after the site of its proposed LNG tanker terminal, an abandoned molybdenum mine company town beside a northern British Columbia inlet from the Pacific.
Kitsault and the global trading plan are wholly owned by Krish Suthanthiran, an entrepreneur from India who became a Canadian and made a fortune selling health care supplies with a firm based in Springfield, VA, Best Medical International Inc. He paid US$5.7 million for the 350-acre BC ghost town, which his firm describes as still equipped to handle a population of 1,000 by refilling vacant modern buildings that were preserved after the mine shut down in 1983.
Kitsault Energy has not disclosed overseas LNG sales contracts, BC gas suppliers or plans for a pipeline to the proposed terminal site, which is 35 kilometers from the southern end of the Alaska Panhandle. The firm has to date only reported that partners are being sought.
As recipient of the 26th LNG export license granted to Canadian tanker terminal projects over the past 16 years, Kitsault raised the volume of gas required on paper by the lineup to an astronomical 500 Tcf. But the NEB does not add up the theoretical number to be a practical strain on potential supplies.
As in all other LNG export license approval decisions the NEB observed that on current and forecast global markets, “The supply side has the potential to far exceed any expectation of future demand.”
The ruling accepts industry forecasts that “market forces will limit the number of operational Canadian LNG facilities. The Board will not predict which licenses will be used or used to the full allowance.”
The NEB approved two other LNG export licenses earlier this month, for AltaGas DC LNG and NewTimes Energy (see Daily GPI, Jan. 19).