By using hydroelectric power and electric drive turbines, Woodfibre LNG intends to reduce greenhouse gas emissions and be the cleanest export facility in the world
Being developed on the former site of a pulp mill about 70 km north of Vancouver, British Columbia (BC), Canada, Woodfibre LNG is not nearly as ambitious in size and capacity as other LNG export facilities in development in Canada or on the US Gulf Coast. Plans by Woodfibre LNG Ltd, a subsidiary of Pacific Oil & Gas, call for Woodfibre LNG to have two trains with a nameplate capacity of 2.1 mta and storage capacity for 250,000 m3 of LNG.
Woodfibre LNG president David Keane describes the project as a “modestly-sized LNG processing and export facility.” But while it does not aspire to be the biggest, the US$1.3Bn facility is determined to be the cleanest.
“We’re proud to say that back in 2014 we made the decision to use hydroelectricity to power the Woodfibre LNG plant,” Mr Keane tells LNG World Shipping. “BC is the only place in the world with three all-electric LNG projects under development and Woodfibre LNG was the first facility in BC to make this commitment.”
Woodfibre LNG will utilise electric drive turbines that will significantly reduce the total greenhouse gas (GHG) emissions of the LNG project, especially when the turbines are powered by renewable clean electricity, explains Mr Keane, noting that “Others are now following our lead”.
A veteran in the energy sector, with more than 37 years in the industry working around the globe in 16 countries, Mr Keane joined Woodfibre LNG as president in October 2018, after serving as president and chief executive of the BC LNG Alliance, the organisation that represents LNG developers in the province.
Prior to joining the BC LNG Alliance, Mr Keane was with British multinational oil and gas company BG Group, which had energy interests in 25 countries and, up until its US$70Bn acquisition by Royal Dutch Shell, was the largest supplier of LNG to the US.
“It was through my work there that got me interested in this industry,” he says, and that work ultimately led him to Woodfibre LNG Ltd.
Country, community and climate
Woodfibre LNG draws its name from the town that grew up around the pulp mill. Besides its close proximity to the water, Mr Keane points out that there are several benefits in developing the facility at the Woodfibre pulp mill site. “It’s a brownfield site, which was home to pulp mill operations for 100 years, so it is zoned industrial. It also has existing access to electricity, a natural gas pipeline and we completed a cleanup of the site earlier this year ready to make way for construction,” he says.
The construction, development and design of the facility are being closely scrutinised by the indigenous peoples of Canada, known as the First Nations, who are major stakeholders in the region.
“A lot of people don’t realise that Woodfibre LNG was the first ever company to receive a First Nations-issued environmental assessment certificate in Canada,” says Mr Keane. “Woodfibre LNG went beyond consultation and engaged in a first-of-its-kind collaborative process with our indigenous partner – Squamish Nation. The Nation has played a pivotal role in shaping the design of the project, which has so far resulted in a project that will be good for our country, community and climate.”
Among the changes to the facility suggested by the Squamish Nation was to switch to an air-cooling system.
“We will use air to cool the Woodfibre LNG facility – the technology we will use is APCI’s C3MR. This decision came about after Squamish Nation Chiefs and Council voted to select air cooling to remove heat from the plant instead of sea water.”
Woodfibre LNG voluntarily entered the Squamish First Nation environmental assessment process and is proud to be the first company in Canada to recognise a First Nations government as a regulator on a proposed industrial project. “We received an Environmental Assessment Certificate issued by the Squamish Nation – a condition of this certificate has already resulted in significant changes to the project, for example, moving from seawater to air cooling,” says Mr Keane.
He notes that all of these decisions, which directly addressed concerns raised by Squamish Nation, mean that “when built, Woodfibre LNG will be the cleanest LNG export facility in the world.”
The use of hydroelectricity is also critical to the facility’s green credentials. “We are reducing GHG emissions by more than 80% by using hydroelectricity,” says Mr Keane, who also notes that when Woodfibre LNG does exporting, its LNG cargoes will have a positive impact on CO2 emissions in Asia, which is expected to be a major customer: “Our project will offset dirtier emissions in Asia – the equivalent of taking more than 410,000 vehicles off the road each year.”
He continues: “There is a strong demand in Asia for clean, natural gas and BC has an abundance of it. Also, given our geographic proximity, we are well-positioned to supply Asian markets.”
LNG carriers transporting cargoes from BC will have shorter routes and will not have to pass through the Panama Canal to reach Asian buyers.
“I believe we will have one of the lowest variable costs of production in the LNG industry and that provides us with a tremendous advantage vis-à-vis our competition along the US Gulf coast,” says Mr Keane.
In June, Woodfibre LNG Export signed a binding LNG sales and purchase agreement (SPA) with BP Gas Marketing Limited for the delivery of 0.75 mta of LNG over 15 years on a free on board (FOB) basis, with first delivery expected in 2023.
The project has received approval from Canada’s National Energy Board to export LNG over a period of 40 years and in July received a key permit from BC Oil & Gas Commission, moving it a step closer to reality.
In August, Woodfibre LNG placed an order for the main cryogenic heat exchanger (MCHE) as it moves closer towards FID.
FID for Woodfibre LNG is expected before the end of this year, with first production in 2023.
Snapshot CV: David Keane