Unable to sell its partially completed liquefied natural gas (LNG) import terminal in Point Tupper, NS, Anadarko Petroleum Corp. has taken a $111 million write-off and will mothball the Bear Head LNG Corp. project.
Anadarko said it would sell the Bear Head subsidiary last year to U.S. Venture Energy, a private equity firm, but the transaction fell through in September (see Daily GPI, Sept. 29, 2006; July 11, 2006). Anadarko had an agreement with Maritimes & Northeast Pipeline to transport Bear Head's regasified LNG through a proposed pipeline expansion (see Daily GPI, Sept. 18). However, Maritimes retained a right to terminate the contract if Anadarko failed to demonstrate that it had arranged for adequate LNG supply to support the terminal.
Anadarko acquired Bear Head in 2004 after purchasing Access Northeast Energy Inc., a private Canadian company (see Daily GPI, Aug. 13, 2004). Anadarko said at the time it planned to use the regasification terminal as a leveraging vehicle for other upstream natural gas opportunities.
The project, which had been approved by Canadian regulators to begin service as early as 2008, could be revived if market conditions improve and LNG supply is secured, according to the Nova Scotia Utility and Review Board. A spokeswoman said the Bear Head site, on Cape Breton Island, has been improved and is ready for construction. The site includes 179 acres of land and a 67-acre water lot.
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