A month after obtaining a conditional, preliminary environmental approval for a Nova Scotia location for the first natural gas storage site on the Atlantic seaboard north of Boston, the proposal’s Calgary sponsor has enlarged on the idea by adding a pipeline concept, named the Atlantic Connector Gas Pipeline.
No maps were unveiled, no projected costs were disclosed and no customers were named when Landis Energy Corp. announced its storage scheme, which could ultimately become the cornerstone of a new 1.2 Bcf/d pipeline. The vision calls for an 800-mile pipeline across Nova Scotia and New Brunswick, reaching Quebec and connections to the northeastern United States.
Landis, originally a gold mining concern that has set out to evolve into an energy asset and services firm, set a date of 2012 for putting the jumbo pipeline into service — just two years after its declared target for starting up its planned gas storage site.
The proposed storage location, in an area known as Alton, which is northwest of Halifax, NS, is an extensive salt deposit a short distance from the Canadian share in Maritimes & Northeast Pipeline. The site is also within easy driving distance of proposed but not yet approved or constructed new liquefied natural gas terminals.
Landis in 2005 sold a 50% investment interest in the Nova Scotia project development program for $3 million to Fort Chicago Energy Partners, a half-owner of the Alliance Pipeline between Western Canada and its associated Aux Sable natural gas liquids extraction plant in Illinois. Landis also raised more than $1.5 million with private sales of corporate paper.
Late in 2007, about a week before Christmas, Landis obtained a favorable Nova Scotia ruling that the provincial environment ministry described as “one step forward in the approval process.” The ruling was accompanied by five pages of conditions for the company to satisfy before developing the proposed gas storage site.
The approved step was completion of an environmental assessment report, which entitles the company to embark on further stages of provincial procedures.
“Further approvals must be obtained before construction and operation of the storage facility,” a Nova Scotia government statement said. “The company must also address potential impacts on fish and fish habitat. An environmental protection plan will be developed.”
Landis, saying engineering and feasibility work is in progress, disclosed no cost estimates for the proposed storage site. Nor have contracts with potential users of the operation been disclosed. The partnership said it “continues to pursue commercial arrangements with a number of parties,” and a decision on whether to proceed with construction of the pipeline is expected in 2Q2008.
Early Landis investor relations literature on the Alton gas storage project predicted the initial capacity of the underground salt caverns would be more than 4 Bcf, enabling injection and withdrawal rates of about 135 MMcf/d. Landis estimated the total potential storage capacity of the site as greater than 50 Bcf.
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