Pieridae Energy Ltd. PEA-T is considering reviving its plan to build a terminal in Nova Scotia to export liquefied natural gas to Germany, but warns that Canadian regulatory hurdles could delay LNG proposals on the East Coast. Pieridae cited high costs and other constraints, such as supply chain problems caused by the COVID-19 pandemic, when it suspended its plans for the Goldboro LNG project last summer. But since the invasion of Ukraine four months ago, Europe has been trying to reduce its dependence on gas from Russia. “You can see what is happening in Europe,” Pieridae CEO Alfred Sorensen said in an interview on Tuesday, announcing a new feasibility study for LNG exports to Germany. “The world has changed a lot.” Prime Minister Justin Trinto met with German Chancellor Olaf Solz on Monday at the G7 summit in Germany. Canada and Germany have discussed LNG opportunities, including the Pieridae export project in Goldboro, NS, and the Repsol SA LNG terminal in New Brunswick. One option is to export 10 million tonnes of LNG a year to Germany, which would be a revival of Pieridae’s original plan for a land terminal, while a reduced version would require 2.5 million tonnes a year exported from a floating facility. Whichever option is chosen, Sorensen said, the chances have improved for the start of construction of the Goldboro LNG, given Germany’s growing energy demand to replace Russian supplies. Pieridae has already signed a 20-year contract for the supply of LNG to the German utility company Uniper. “We are cautiously optimistic. “There is still a long way to go, so the feasibility study needs to be done and we need to understand what the cost structure will be and then we can decide,” he said. Pieridae hopes to make a final investment decision by mid-2023, the CEO said. The goal is to start exporting to Germany by 2028 in the scenario of a full-scale export terminal in Nova Scotia. Mr Sorensen said Canada has a time-consuming regulatory process for project approval that challenges companies to navigate. “What we have said to the federal government is that you have created this regulatory problem and you have to solve it,” he said. If Pieridae opts for the full-scale LNG terminal, significant upgrades and extensions will be required from TC Energy Corp.’s pipeline system. to Ontario and Quebec to bring gas from Alberta, which in turn will be part of a line connecting the Maritimes & Northeast pipeline from New England to New Brunswick and Nova Scotia. Repsol spokesman Michael Blackier said he recognized the recent interest in Saint John LNG, which is currently operating as an import terminal. “Repsol is constantly exploring options to maximize the value of the terminal, with a particular focus on new low-carbon opportunities to help meet market demand and support the energy transition,” he said in an email. “The company will consider any / all companies that enhance or create value in Saint John LNG, including the possibility of adding liquefaction capabilities to the existing facility.” Goldboro LNG and Saint John LNG will have to negotiate for TC Energy and other pipeline companies to transport gas from Alberta to the East Coast. Natural Resources Secretary Jonathan Wilkinson said in an interview with The Globe and Mail in March that the federal government remains committed to meeting Canada’s zero-carbon target by 2050. That means LNG proponents should rely on electrification for liquefaction of traditional turbines with natural gas combustion to supercool the goods in liquid form. “Canada is committed to exploring options for enhancing the energy security of our allies,” Ian Cameron, Wilkinson’s director of communications, said in a statement last month. “However, we expect the projects to be in line with our existing domestic and international climate commitments.” A third option for the East Coast is LNG Newfoundland and Labrador Ltd., which is studying the feasibility of securing offshore gas from the Grand Banks and aims to start exporting LNG to Europe in 2030. However, there could be competition from Western Canada for access to gas reserves if LNG Canada in Kitimat, BC, decides to build a second phase at its currently under construction terminal and if LNG projects of the West Coast such as Woodfibre, Ksi Lisims, Cedar and Tilbury are advancing. Your time is precious. Have the Top Business Headlines newsletter with convenient delivery to your inbox in the morning or evening. Register today.
