The economic recession and liquefied natural gas (LNG) market dynamics have caused the indefinite postponement of an LNG transshipment and storage terminal proposed by Newfoundland LNG Ltd. for Grassy Point on Placentia Bay on the southeast coast of Newfoundland, Canada.
"It is on hold. It's only on hold due to the recessionary impact and, of course, due to the price of LNG right now," Newfoundland LNG President Mark Turner told NGI last Monday. "And also some of the suppliers have been slow [to come on-line] as well. We're just going to wait and see what happens as we move forward."
Last week developers of another Canadian LNG project, the Canaport LNG terminal at Mispec Point near Saint John, NB, said they were expecting their first cargo to arrive in a matter of days (see related story).
As originally conceived, the Newfoundland project was intended to provide transshipment and storage services for northeastern U.S. and Canadian LNG importers and providers. The facility would have provided LNG cargo transfer, short- and long-term storage of LNG, temporary vessel-based LNG storage and a lay-up site for in-transit LNG carriers.
Newfoundland LNG is a joint venture of North Atlantic Pipeline Partners LP and LNG Partners LLC. The project would include eight 160,000-cubic-meter storage tanks, three jetties with berthing facilities capable of mooring 265,000-cubic-meter LNG cargo ships, and a tugboat basin along one of North America's deepest ice-free ports. It would not include LNG regasification facilities.
The project, which was intended to accommodate up to 400 vessels per year, was slated to begin construction in summer 2007, but Turner told NGI last year that construction was delayed and was expected to begin in late 2008 or early 2009. The project received environmental approvals last summer (see NGI, Aug. 18, 2008).
Turner said he had no idea of a timeline for a decision on the project. It could be scaled down from eight storage tanks to four. "There's no big rush, but we are looking at downsizing," he said, noting that he is confident the project could eventually move forward as he expects the price for LNG to strengthen. "I think it will have to," he said. "LNG is a very good product. It's a clean, efficient fuel. I do believe that it's going to come back. My own guess, I'd say maybe a year and a half, two years until it comes back up to a level that we can do some business."
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