Irving Oil Proposes Adding LNG Terminal in New Brunswick
Irving Oil Ltd., which has operated the deepwater terminal Irving Canaport in New Brunswick since 1970, has applied for a permit to add a liquefied natural gas (LNG) terminal to the site, located about 60 miles from the U.S. border. The proposed project, which would cost about C$500 million to construct, would give Canaport, which has a current total tank capacity of 12.5 MMbbl, the ability to receive LNG cargoes and vaporize the LNG for send-out over the pipeline grid.
While several LNG projects have been proposed for the U.S. West Coast and along the Gulf of Mexico this year, this is the first proposal announced for the far North geared toward the U.S. East Coast.
The Irving Canaport was the first deepwater terminal in the Western Hemisphere, undergoing an expansion in the 1970s and a complete overhaul costing C$1 billion in the late 1990s. It has held a municipal zoning permit for handling natural gas for several years. The Canaport covers 1,802 acres, has a water depth of 128 feet at low tide and is connected by pipelines to the Irving Oil Refinery five miles away.
CEO Kenneth Irving said the announcement "marks the next stage of our feasibility assessment and permitting process." He said that by adding natural gas capability to Canaport, it would "act as a catalyst for future investment in the region, as well as enhance the attractiveness of the Scotian Shelf and the Newfoundland Grand Banks." The proposed project, he said, would add to the "critical mass" of existing energy infrastructure, which could in turn accelerate investments by other companies.
"We have been carefully assessing this opportunity," Irving said, "and we believe that the market outlook and industry conditions support us taking this step at this time...we believe the business case for adding a natural gas capability here is a compelling one."
Canaport is a year-round, ice-free deepwater port, able to receive ships weighing more than 400,000 tons. The CEO also cited the area workforce as a major factor in the company's decision to expand. They have "proven experience with large-scale energy projects," said Irving.
"Our decision to begin the permitting process for this project at this time is the New Brunswick government's energy vision," Irving said. New Brunswick's "White Paper on Energy" includes achieving a "secure, reliable and cost-effective energy supply" as a key goal, and also states that a LNG terminal could assist in achieving that goal.
Irving Oil, headquartered in Saint John, NB, was founded in 1924 and remains a privately-owned energy processing, transporting and marketing company. Irving Oil's 250,000 bbl/d refinery accounted for 35% of Canada's total petroleum exports in 2000. It now sells gasoline to the California market and is also the region's largest purchaser of liquid petroleum gas. Irving Canaport also is connected to the Bayside and Coleson Cove power plants by pipelines, which have a total nameplate capacity of 1,325 MW.
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