Contact Exploration Inc. and Pieridae Energy Ltd. have created Pieridae Production LP (PPLP) to focus on natural gas exploration and production in support of Pieridae’s proposed Goldboro LNG Terminal in Guysborough, Nova Scotia.
The proposed terminal is expected to receive, liquefy and export up to about 10 million tonnes per annum (mtpa) of LNG and have on-site storage capacity of 690,000 cubic meters of liquefied natural gas (LNG). North American natural gas supplies are to be transported to Goldboro using existing pipelines and exported by ship to international markets. PPLP is to focus on securing and developing gas assets onshore in Atlantic Canada and the eastern United States for the terminal.
“We are ideally positioned to source and develop long-term sustainable feedstock for the proposed Goldboro LNG Terminal by leveraging our longstanding history in Atlantic Canada and our tight gas expertise from Western Canada,” said Contact CEO Steve Harding. “By combining efforts with Pieridae and their extensive knowledge of North American gas transmission systems and global LNG markets, we believe that the partnership will be a valuable entity integral to advancing the success of the Goldboro LNG Terminal.”
Last fall, Pieridae Energy Canada announced its $5 billion Goldboro LNG project to load 700 MMcf/d of liquefied gas into tankers bound for overseas markets from Nova Scotia (see Daily GPI, Oct. 25, 2012).
Assets initially acquired by PPLP consist of about 50,000 acres prospective for gas development within New Brunswick, initially held by Contact. As consideration for the indirect contribution of a 15% working interest in the assets into the partnership, Contact has received an initial cash payment of C$1.3 million from Pieridae and has been issued common shares of Pieridae equal to 15% of its currently issued and outstanding shares.
Initial ownership of PPLP is to be 85% Contact and 15% Pieridae. An additional $15.4 million of third-party equity funding for the partnership is being sought and coordinated by Pieridae. If this is secured, it will reduce Contact’s ownership in the partnership to 50%.
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