The deadline for an FID on Goldboro LNG, Canada’s first east coast LNG export facility, has been extended to 30 September 2020, following a long-term deal with German utility Uniper for gas deliveries
Goldboro LNG developer Pieridae Energy Limited announced it has negotiated extensions of the key deadlines under its 20-year agreement with Uniper. Commercial deliveries of gas to Uniper are expected to start between 30 November 2024 and 31 May 2025. The 20-year agreement with Uniper is for half the liquefied natural gas produced at Goldboro LNG, or 5 mta.
While the project still faces hurdles, Pieridae Energy spokesperson James Millar told LNG World Shipping that Goldsboro LNG was “ahead of the game” of some other facilities because it had all of its major permits in place, has a major anchor customer and does not need to construct a greenfield pipeline.
To be located in Nova Scotia at the Goldboro Industrial Park in Guysborough, the Goldsboro LNG facility lies between the Maritimes and Northeast Pipeline and the Sable Offshore Energy project. Plans call for the facility to have two trains that produce a nameplate capacity of 10 mta of LNG, with three storage tanks of 230,000 m3 each and a marine jetty that can accommodate LNG carriers between 140,000 m3 and 250,000 m3 capacity. The projected capital expenditure for the project is US$10Bn, with commercial operations expected to start by 2023.
“These extensions allow us to complete the work needed to make a final investment decision for the Goldboro Project”, said Pieridae chief executive Alfred Sorensen. “We continue to have ongoing discussions with KBR that will ultimately lead to finalised designs and fixed costs for the project. We expect the vast majority of that work to be completed near the end of 2019, which will move us closer to FID”.
Kellogg, Brown & Root Limited (KBR) is reviewing an amended version of a previously prepared front-end engineering and design study for the proposed Goldboro LNG facility. KBR will also conduct an open-book estimate necessary for entering into a lump sum turnkey engineering, procurement and construction contract.
“We’re working with KBR to lock down a fixed price for the contract by Q1 2020”, said Mr Millar.
“Our recent announcement that we will be acquiring key Shell assets in the Alberta Foothills helps us secure much of the remaining conventional natural gas supply needed for the first train at Goldboro”, added Mr Sorensen.
Energy security is also playing a role in the financial backing of the project by the German Government. Germany is phasing out coal-fired and nuclear power plants and with European gas production expected to fall by 50% over the next 20 years, needs new sources of natural gas beyond Russia. The Goldboro LNG project is eligibile in principle for up to US$1.5Bn in loan guarantees under Germany’s UFK programme in relation to financing conventional upstream natural gas development for the project.
German loan guarantees of up to US$3Bn would also back the proposed financing of the construction of Goldboro LNG train 1 and all associated facilities.