Pieridae Energy Ltd., sponsor of a stalled project to export liquefied natural gas (LNG) from Nova Scotia to Europe, recently outlined the conditions needed to resuscitate the Goldboro LNG plan.

goldboro lng

In Pieridae’s recent fourth quarter and full-year 2021 earnings report, CEO Alfred Sorenson said the company still believes “an LNG project at our Goldoro site could be an economically compelling and nation building opportunity.”

He qualified that statement, however.

[Want today’s Henry Hub, Houston Ship Channel and Chicago Citygate prices? Check out NGI’s daily natural gas price snapshot now.]

“What Pieridae needs in order to continue development of the project is a commitment of support from the Government of Canada that this initiative is a national priority,” he said.

Pieridae suspended Goldboro LNG last July. A nine-year effort to carry out the $10 billion plan to ship 1.3 Bcf/d across the Atlantic included an unsuccessful appeal for $1 billion from the Canadian government.

The Covid-19 pandemic had delayed a final investment decision for the project.

Sorenson pointed out that other conditions would need to be met as well to revive Goldboro LNG.

“Pipeline capacity to transport the gas to the East Coast would need to be worked out,” he said. “We must find an investment partner…”

Moreover, he said Pieridae would like the Mi’kmaq, an indigenous nation in Atlantic Canada, to “remain involved as partners.” 

Subsidy Receptiveness

An LNG terminal subsidy remains out of step with national policy. At an International Energy Agency (IEA) meeting on the Ukraine war’s threat to supply security, Canadian Natural Resources Minister Jonathan Wilkinson offered no support.

Wilkinson only estimated capacity available for daily increases by current export services that only go to the United States, if customer demand emerges: 200,000 b/d of oil and up to 100,000 boe/d, or almost 600 MMcf/d, of natural gas.

Europeans are “telling us they need our help in getting off Russian oil and gas in the short term, while speeding up the energy transition [off fossil fuels] across the continent,” said Wilkinson in a message to Canadians from the IEA talks.

“We will continue working with our international partners to support international energy markets and accelerate the energy transition.”

Pieridae’s production edged downward year/year. Natural gas output dipped to 199.8 MMcf/d in 2021, compared to 201 MMcf/d in 2020. Condensate production slipped year/year from 3,020 to 2,877 b/d. Likewise, annual natural gas liquids output dropped to 4,386 b/d in 2021 from 5,473 b/d in 2020.

Financial hedging contracts limited revenue gains for Pieridae, which reports in Canadian dollars (C$1/US 80 cents). The 4Q2021 average that Pieridae realized for natural gas, $3.67/Mcf, trailed the benchmark $4.69/Mcf on physical markets for Canadian production. Pieridae condensate averaged $69.71/bbl, also well below the physical market’s $100.10/bbl.

Pieridae posted 4Q2021 net income of $4.7 million (3 cents/share), swinging from a 4Q2020 loss of about $46 million (minus 29 cents). 

For full-year 2021, Pieridae reported a $39.8 million loss (minus 25 cents/share), an improvement from its $100.7 million loss (minus 64 cents) in 2020.