Put a bow on it..That’s because at least one major pipeline should be wrapped up by Christmas after Coastal GasLink announced it is substantially complete — after more than ten years and $8 billion over budget..The company — owned by Calgary-based TC Energy — said the 670-kilometre conduit connecting prolific gas fields in northern British Columbia and Alberta is 98% complete as of September 28. All 800 water crossings, including 10 ‘trenchless’ crossings — had been completed as of August 30.. Coastal GasLink map .The last major stretch, a 54-kilometre section north of Vanderhoof to Burns Lake in partnership with the Nadleh Whut’en First Nation was finished last month, the company said in a news release..All that’s left to do is remediate top soil along several sections and implement ‘erosion and sediment control’ — a technical term for replanting vegetation on the right away which could take a few years after it formally comes into service sometime in 2025..“While the project is quickly approaching mechanical completion at the end of 2023, there are a number of critical activities that the project team will continue to execute on,” TC said in a release..It ends a rocky road for the troubled link, amid protests, injunctions and vandalism amid a backdrop of escalating cost overruns..Earlier this year, Coastal upped its final price tag for the line to $14.5 billion, up from $11.2 billion, which was in turn double its initial estimate of $6.2 billion in 2012..Now its waiting on the massive Shell-led LNG Canada project to be complete. As of July 1 the $48.3 billion terminal — which includes the pipeline — near Kitimat was about 85% complete and on track for first gas deliveries sometime “mid decade” according to its own construction update.. LNG costsCost overruns have put Canada at a competitive disadvantage to US for LNG exports. .That project was first proposed in 2011 and approved on October 1, 2018..It’s good news for Canadian gas producers who will finally have access to global markets. It’s also good news for the Alberta and BC governments, who are negotiating with Ottawa to have gas exports included under Article 6 of the Paris Accord to help countries such as China displace coal-fired power..But it’s bad news as Canada watches its LNG advantage slip away, especially to the US which was formerly Canada’s largest export market and has now become its largest competitor..Thanks to events in Europe, such as the war in Ukraine, the US Gulf Coast has emerged as the largest LNG export point in the world..And according to an analysis by the Institute for Energy Economics and Financial Analysis earlier this year, the US enjoys a significant — 50% — cost advantage over Canada by virtue of the aforementioned overruns. .“Ballooning construction costs for pipelines and liquefied natural gas (LNG) facilities are creating new financial risks for Western Canada's LNG industry… undermining the project's economic competitiveness,” it said. .British Columbia's gas producers face rising costs from a new royalty regime, and producers in both BC and Alberta face regulatory uncertainty stemming from a successful legal challenge brought by First Nations groups..“Rising construction and gas transportation costs, coupled with mounting uncertainty about gas permitting and production, have created a challenging environment for new LNG projects, including the proposed Woodfibre LNG project in Squamish, BC,” it concluded.
Put a bow on it..That’s because at least one major pipeline should be wrapped up by Christmas after Coastal GasLink announced it is substantially complete — after more than ten years and $8 billion over budget..The company — owned by Calgary-based TC Energy — said the 670-kilometre conduit connecting prolific gas fields in northern British Columbia and Alberta is 98% complete as of September 28. All 800 water crossings, including 10 ‘trenchless’ crossings — had been completed as of August 30.. Coastal GasLink map .The last major stretch, a 54-kilometre section north of Vanderhoof to Burns Lake in partnership with the Nadleh Whut’en First Nation was finished last month, the company said in a news release..All that’s left to do is remediate top soil along several sections and implement ‘erosion and sediment control’ — a technical term for replanting vegetation on the right away which could take a few years after it formally comes into service sometime in 2025..“While the project is quickly approaching mechanical completion at the end of 2023, there are a number of critical activities that the project team will continue to execute on,” TC said in a release..It ends a rocky road for the troubled link, amid protests, injunctions and vandalism amid a backdrop of escalating cost overruns..Earlier this year, Coastal upped its final price tag for the line to $14.5 billion, up from $11.2 billion, which was in turn double its initial estimate of $6.2 billion in 2012..Now its waiting on the massive Shell-led LNG Canada project to be complete. As of July 1 the $48.3 billion terminal — which includes the pipeline — near Kitimat was about 85% complete and on track for first gas deliveries sometime “mid decade” according to its own construction update.. LNG costsCost overruns have put Canada at a competitive disadvantage to US for LNG exports. .That project was first proposed in 2011 and approved on October 1, 2018..It’s good news for Canadian gas producers who will finally have access to global markets. It’s also good news for the Alberta and BC governments, who are negotiating with Ottawa to have gas exports included under Article 6 of the Paris Accord to help countries such as China displace coal-fired power..But it’s bad news as Canada watches its LNG advantage slip away, especially to the US which was formerly Canada’s largest export market and has now become its largest competitor..Thanks to events in Europe, such as the war in Ukraine, the US Gulf Coast has emerged as the largest LNG export point in the world..And according to an analysis by the Institute for Energy Economics and Financial Analysis earlier this year, the US enjoys a significant — 50% — cost advantage over Canada by virtue of the aforementioned overruns. .“Ballooning construction costs for pipelines and liquefied natural gas (LNG) facilities are creating new financial risks for Western Canada's LNG industry… undermining the project's economic competitiveness,” it said. .British Columbia's gas producers face rising costs from a new royalty regime, and producers in both BC and Alberta face regulatory uncertainty stemming from a successful legal challenge brought by First Nations groups..“Rising construction and gas transportation costs, coupled with mounting uncertainty about gas permitting and production, have created a challenging environment for new LNG projects, including the proposed Woodfibre LNG project in Squamish, BC,” it concluded.
