Goldboro LNG awards FEED contract to CB&I

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Goldboro LNG, the Canadian export project proposed in Nova Scotia, has taken another significant step towards its goal of reaching final investment decision in 2015. Project sponsor Pieridae Energy has selected CB&I to undertake front-end engineering and design (FEED). The project is currently expected to cost $8.3 billion, a specific capital cost of $830 per tonne per year of capacity.

Export stampede: Like the US, Canada is experiencing an LNG export stampede. The National Energy Board (NEB) has already given export approvals to 11 projects, and applications from another three – including Goldboro LNG – are “under review”. However, most of these proposed projects will be located on the west coast, putting them in a prime position to export LNG to markets in Asia Pacific. Goldboro LNG is an exception. Located on the eastern coast, it has already committed half of its 10 mtpa capacity  to Europe.Chart showing shipping distances

“Goldboro LNG will be the east coast of Canada’s and the United States’ closest mainland LNG export terminal to Europe and India,” says Pieridae. “Its location . . . provides substantial advantages for transporting LNG to key markets.”

“Having received environmental assessment approval from Nova Scotia’s environment minister in March 2014, the selection of CB&I to undertake FEED is another important milestone,” said Pieridae CEO Alfred Sorensen.

Export licence likely soon: Assuming FID is reached in 2015, and that the project receives all the necessary regulatory and government permits Pieridae expects construction to take four years, with commercial operational beginning in 2020. The project has a good chance of winning that approval within weeks, given that the NEB has yet to turn a project down.

The company has submitted an application to the NEB to import up to 1.0 Bcf/d of gas through the existing pipeline systems between Canada and the United States, and to export up to 1.4 Bcf/d gas, as LNG, to international markets.

The project will consist of a processing plant and facilities for the storage and export of LNG, including a marine jetty and LNG storage capacity of 690,000 cubic metres.

Pieridae says it is in “advanced discussions with several natural gas producers, pipeline operators and LNG customers”. A year ago, the company signed a 20-year sales and purchase agreement (SPA) to supply the German utility E.ON, one of the world’s largest investor-owned power and gas companies, with 5 mtpa of LNG.

Earlier this year Sorenson participated in a trade mission to Germany, led by Canadian Prime Minister Stephen Harper.  (In the photo above, Harper is to the left of German Chancellor Angela Merkel, while Sorensen is on the extreme right.)

Pieridae – an energy infrastructure development company  founded in 2011 – anticipates that, at its peak, the Goldboro LNG terminal will create up to 3,500 jobs during construction and 200 full-time, permanent jobs during operations.