An opening regulatory move has been made toward building a Canadian LNG export terminal on the east coast by the New Brunswick arm of Spain’s Repsol SA, but natural gas deliveries are years away.

The plan by Saint John LNG Development Co. (SJLNG) aims for initial exports of 300 MMcf/d, or only 40% of the targeted volumes that were in a previous version of the project, according to an application filed Wednesday to the Canada Energy Regulator (CER).

No decision has been made to build the proposed addition at the existing import terminal on the New Brunswick coast, the CER filing noted. Approval would only allow extra time to develop the export project.

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SJLNG is seeking to extend its export license to begin deliveries around May 2032. The terminal addition would allow planning, regulatory approval and construction stages, the application noted.

The chief export project hurdle would be securing supplies, SJLNG noted. A wide gap in the Canadian pipeline grid would require roundabout deliveries from western Quebec across the eastern United States and north to New Brunswick.

No pipeline from the country’s main oil and gas provinces, Alberta and British Columbia, reaches the Atlantic seaboard. An SJLNG export terminal would import eastern U.S. or Western Canadian-sourced gas via Maritimes & Northeast Pipeline (MNE).

There has been only minor production from Atlantic Canada since offshore platforms closed in 2018, with small heating season flows from legacy land wells. 

SJLNG’s filing said “numerous aspects of the proposed expansion remain uncertain and the timeline for first natural gas imports and liquefied natural gas exports is currently unknown…

“Even with an aggressive timeline, it would take a minimum of three years for the necessary approvals to be obtained and the facilities constructed.”

The scaled-down version of SJLNG’s export plan would also use up all the supply capacity that could be squeezed into the pipelines without excessively expensive service additions, it noted.

“While the liquefaction capability of the LNG facility could be further expanded in the future, any such additional expansion is entirely dependent on the future availability of existing pipeline capacity, as further expansion of the interconnecting pipelines is cost prohibitive.”

In its original role as an import terminal to move gas to the northeastern United States, 13-year-old SJLNG was stranded by rapid development of much less costly unconventional gas supplies.

Repsol wrote off $1.3 billion of the terminal’s value in 2013. Shell plc also excluded the New Brunswick property from a $4.4 billion purchase of other Repsol global LNG assets.

Gas traffic through SJLNG as an import terminal remains low, CER trade records indicate. In 2021 flows averaged 67.6 MMcf/d, or less than 7% of the site capacity for 1 Bcf/d.