As a flurry of well site bombings by still-unknown protesters in 2008 and 2009 fades into history, plans are advancing to accelerate natural gas development near the Dawson Creek starting point of the Alaska Highway in northeastern British Columbia (BC).
Production in the touchy area will grow at least seven-fold over the next 15 years, Spectra Energy predicts in an application to build a gas processing plant and pipelines. The National Energy Board (NEB) has scheduled public hearings on the project to begin Nov. 30 in Dawson Creek.
The event follows a long period of calm since a gas field bombing campaign in the nearby Tomslake district drew international media attention and triggered an extensive investigation by a special anti-terrorism squad of the Royal Canadian Mounted Police.
The probe ended in raids on celebrated industry resister Wiebo Ludwig and his Trickle Creek Colony, a religious commune just east across the BC boundary in the Hythe area of northwestern Alberta. Prosecutors laid no charges, saying the police had too little evidence to be reasonably assured of achieving a conviction (see Daily GPI, Jan. 12).
The BC bombings stopped after the police raids. A C$500,000 reward for identifying the guilty party, posted by Encana Corp., remains unclaimed. Ludwig, who has steadfastly maintained his innocence, previously served 28 months behind bars after being convicted on charges arising from an Alberta gas field bombing case.
Resistance against the processing project has to date been limited to polite questions about the effects of associated additional drilling on surrounding traditional Aboriginal territory and farms, led by a regional residents coalition known as the Peace Environment and Safety Trustees Society (PEST).
Spectra predicts production in the gas development area around its Dawson Creek plant site will steadily climb to at least 800 MMcf/d by 2034 from an anticipated 128 MMcf/d in 2012. The proposed plant is designed to make a start on keeping up by creating 200 MMcf/d of processing capacity.
Known as the South Peace, as opposed to the Horn River shale gas hot spot in the Fort Nelson district near BC's boundary with the Yukon and Northwest Territories, the Dawson Creek region is a focal point for drilling into a rich geological formation called the Montney. Wells into the complex zone range from conventional vertical drilling to shale gas-like deep, horizontal bores fed by artificial flow channels created with multiple hydraulic fracture injections.
A compact region of about 1,050 square kilometers (400 square miles) of drilling targets around the proposed plant harbors 21 Tcf of gas, Spectra estimates. Even using a "conservative recovery factor" -- by assuming only one-fifth of the deposits will be produced with currently routine methods -- the area is forecast to yield 4.2 Tcf.
Costs of the new plant and pipelines are being kept confidential as competitive information in the rapidly developing northern BC gas fields. The project is supported by a processing contract with a major producer and Spectra assures that it will have no effect on service rates for other companies using its Westcoast Transmission network of BC gas field services.
The customer's identity is also being kept confidential. Numerous producers are active in the area such as Encana, Murphy Oil Co., Talisman Energy Inc., and Apache Corp. following its summer purchase of BP Canada Energy Co.'s gas assets for C$3.25 billion (US$3 billion). Just one field development begun in the area by BP before the takeover transaction, called Noel, is forecast to grow steadily into production of 130 MMcf/d.
Spectra's schedule calls for a first, 100 MMcf/d stage of the new plant to start operating as of Oct. 1, 2011. Quiet optimism about long-range prospects for the gas market supports the project.
"After recovering from the recent recession the growth in North American natural gas demand is expected to continue," Spectra says in its NEB filings. "This growth is expected to arise from two primary sources: economic growth and the preference for using natural gas to fuel electricity generation." The new BC supplies will also replace deteriorating old conventional production from Alberta, which its Energy Resources Conservation Board forecasts will decline at an annual average rate of 4%, Spectra said.
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