Sunday, November 12, 2006

Nova Scotians concerns of the propose pipeline!!!


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HALIFAX, NOVA SCOTIA | Saturday November 11, 2006

Bullet being fired into N.S. offshore industry

By Roger Taylor

I DOUBT anyone in the Nova Scotia business community is opposed to Repsol YPF and Irving Oil building their Canaport liquefied natural gas terminal in Saint John — not even those who plan to build their own LNG facilities in the Strait of Canso area.

It’s quite another matter when it comes to the New Brunswick plant bypassing the tolls on Maritimes and Northeast Pipeline.

The backers of Canaport LNG want it to have its own direct route to New England, rather than hooking into the nearby M&NE pipeline on the Canadian side of the border. They have teamed up with Emera Inc. of Halifax, which would build the $350-million Emera Brunswick pipeline if it gets approval from the National Energy Board.

The bypass is specific to Canada because the so-called bullet pipeline would be tapped into the M&NE pipeline once it crosses the border at St. Stephen, N.B. And no one believes that’s a coincidence.

The tolls charged to all the customers who used the M&NE pipeline on the Canadian side of the border help to subsidize the cost of transmitting all the gas in the pipeline. The more users of the Maritimes and Northeast pipeline, the cheaper it is for everyone to ship natural gas to the United States.

The board is holding a hearing in Saint John to help determine whether the bullet pipeline is a good idea. The panel has already decided it will only look at the case for the New Brunswick pipeline and will not take into consideration the economics of the M&NE line.

Having its own pipeline to the U.S. means Canaport LNG will have an advantage over shipments of natural gas to New England via M&NE pipeline. Besides that, it will have a chilling effect on any potential Nova Scotia LNG proceeding and could even jeopardize gas projects off the Nova Scotia coast, because the economics would be less attractive.

Construction of the New Brunswick bullet line to Maine would be a severe blow to the economic potential of Nova Scotia. Just ask anyone involved in plans for an energy centre at the Strait of Canso. One of the Strait projects would, in theory, create a $4.5-billion petrochemical chemical complex in Goldboro, Guysborough County. It would use liquefied natural gas as feed stock for the petrochemical plant, and the component of natural gas not needed for the petrochemical business would be shipped to the U.S. by M&NE Pipeline.

Maple LNG, Suntera and Keltic Petrochemicals Inc. of Halifax are the partners behind the Goldboro proposal. Keltic president Kevin Dunn is very concerned about the effect the New Brunswick pipeline would have on the privately funded multibillion-dollar petrochemical concept he has been working on for five years.

Dunn had been planning to outline the reasons for his opposition to the New Brunswick pipeline and his concern was that the Nova Scotia government wouldn’t be vigorous enough in its arguments against the project, but he decided to hold off making a statement Friday.

Instead, he has put it off until Tuesday, just to double-check his notes and make sure his arguments opposing the New Brunswick pipeline are absolutely clear. There’s little doubt, however, that the future of Dunn’s dream for his home province could be in jeopardy if the bullet line gets the green light from the energy board.

If it weren’t for the Sable Offshore Energy Project and its need to transmit natural gas from Nova Scotia’s offshore to markets in the United States, there would not be a pipeline to sparsely populated northern Maine in the first place.

So it would be short-sighted for the regulator to say that nothing is wrong with ignoring the Maritimes and Northeast pipeline in Canada while conveniently hooking into the same pipeline in Maine.

The Goldboro project isn’t the only one affected. The dream of creating a $650-million LNG plant at Bear Head, Richmond County, as endorsed by the government agency Nova Scotia Business Inc., would also be in jeopardy if the New Brunswick pipeline were allowed to go ahead.

Anadarko Petroleum Corp. now owns that project but is in the process of finding someone to acquire it; no word on whether the New Brunswick pipeline is putting a damper on finding a potential buyer.

EnCana Corp. this week filed plans to develop a scaled-down Deep Panuke offshore project. There is nothing certain about that deal going ahead as planned, so it is disconcerting to think that potential changes to pipeline economics might cause the Calgary energy company to have second thoughts.

The sketchy economics of capturing onshore coal-bed methane in Nova Scotia and injecting it into the M&NE pipeline so that it could be sold in New England — a long-held dream of many — would be further questioned. And there are other onshore projects in New Brunswick that could be affected by the bullet.

The Nova Scotia government says it will strongly defend the interests of Nova Scotia at the National Energy Board hearing, but there are some — including some Anadarko executives — who believe the government hasn’t always felt that way.

There is no way to determine on the basis of a government news release how strongly lawyers for the government will fight in Saint John. Nova Scotians will have to judge for themselves when the hearing in Saint John resumes next week.

( rtaylor@herald.ca)

Roger Taylor’s column appears Tuesday, Wednesday, Friday and Saturday.

2 comments:

Anonymous said...

TheChronicleHerald.ca
HALIFAX, NOVA SCOTIA | Wednesday November 6, 2006

"Aggressive’ opposition planned

Nova Scotia prepares to fight Emera’s proposal to ship liquified natural gas through N.B.
By JUDY MYRDEN Business Reporter

SAINT JOHN, N.B. — Nova Scotia is trying to make sure Emera Inc. cannot operate a cheap pipeline to carry liquid gas that could scuttle the future of two energy projects in this province.

Energy Department representatives say they will be "very aggressive" when they appear at National Energy Board hearings that start this afternoon in Saint John.

The hearing will determine the delivery cost of transporting the liquefied natural gas along the proposed 145-kilometre pipeline from the planned Irving-owned Canaport LNG facility, where giant tankers will bring the super-cooled gas from Spanish-owned Repsol by late 2008 and then ship it to the U.S.

Premier Rodney MacDonald wants the energy regulator to examine the impact of Emera’s proposed $350-million pipeline on two proposed LNG terminals in Nova Scotia, which could face higher delivery charges than its competitor in New Brunswick.

"I’m concerned about the potential impact," said Mr. MacDonald. "We plan to be very aggressive at the upcoming hearings."

He said the proposed Emera line will bypass other pipelines and could affect delivery tolls charged on the existing 558-kilometre pipeline, which carries gas from fields near Sable Island between Nova Scotia and the United States, as well as hurting the two Nova Scotia LNG projects. The Emera pipeline will travel through southwest New Brunswick and connect with the U.S. portion of the Sable pipeline at the international border near Baileyville, Maine.

The LNG projects being proposed in Nova Scotia are one by Anadarko Petroleum, which is in limbo after a deal to sell the project to a U.S. equity firm collapsed in September, and a second in Goldboro by Keltic Petrochemicals of Halifax and 4Gas of Rotterdam.

The crux of the issue for Nova Scotia, outlined in questions filed by Nova Scotia’s Energy Department, is that the Irving/Repsol project could pay cheaper toll charges than the Nova Scotia projects would pay.

They argue that if the Emera pipeline had hooked up to the Duke Energy-owned Maritimes and Northeast pipeline, it would have increased the volume of gas in the system and lowered tolls for all users.

Peter Milne, a consultant for Anadarko, has filed evidence with the board outlining the potential effects of a so-called bullet line that bypasses the Sable pipeline, Maritimes and Northeast, on customers now using the line to transport gas from Nova Scotia’s only offshore gas project.

"The higher tolls and costs on the Canadian segment of the M&NP system will give natural gas from the Canaport LNG a significant competitive advantage over Sable Island gas producers," Mr. Milne says in his filing. Expectation that the Canaport LNG facility will get cheaper tolls is already making it hard for Anadarko to find a supply of gas for its proposed facility near Port Hawkesbury, he says.

Mr. Milne says the Irving-owned development was "hampered" in its efforts to secure a supply of gas for the Bear Head site because of a "$1.5 billion transportation advantage" gained by the Emera bypass pipeline. And any discount toll deal for Canaport could be "fatal" for LNG projects in Nova Scotia.

Mr. Milne proposes that the pipeline run north to join with the Canadian portion of the Maritimes and Northeast system.

Emera has negotiated a 25-year deal with Repsol on what it will charge to transport gas through what is called the Brunswick Pipeline. The toll proposed is 14 cents US per gigajoule, and Mr. Milne says the Emera pipeline will offer the Irving project a 25-cent advantage.

While Emera will own the pipeline, it has negotiated agreements with Duke Energy under which an affiliate of the U.S. pipeline company will continue to permit, construct and ultimately operate the pipeline for Emera.

Duke spokesman Stephen Rankin said there is no way to compare tolls between New Brunswick and Nova Scotia for the LNG projects because Anadarko hasn’t filed any project requiring space along the pipeline.

"We don’t have a toll to compare it to," Mr. Rankin said. "There’s no way to answer that. It depends on the facilities that (Anadarko) would want."

He said the route chosen for the Brunswick Pipeline is "superior" environmentally and in terms of engineering.

( jmyrden@herald.ca)





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TheChronicleHerald.ca

HALIFAX, NOVA SCOTIA | Friday November 10, 2006

Residents make pitch for underwater pipeline
Energy regulator hears about safety concerns related to N.B. gas project
By JUDY MYRDEN Business Reporter

SAINT JOHN — Halifax-based Emera Inc. stands to make about $1.2 billion over the next 25 years by building a high-pressure, high-speed gas pipeline through the centre of Saint John while residents are taking all the risks, the National Energy Board has been told.

Citizens trying to stop the proposal urged Canada’s energy regulator Wednesday night to reject the construction of what would apparently be the country’s first line for supercooled gas that would be regasified for export to the United States.

"We get the risks, the corporations get the profits," David Jory told the three-member panel.

"And the risk for the corporations is merely financial; the risk for the citizens is death or horrible injury."

The retired University of Saint John professor has safety concerns about running a pipeline through residential neighbourhoods and near schools, hospitals and a cherished public park in the port city.

Mr. Jory, a citizens group and the New Brunswick Conservation Council want any pipeline to be built underwater for eight kilometres instead of under residents’ feet. The $350-million line is being proposed by Emera for Irving Oil and its partner, Spanish-based Repsol, to connect a liquefied natural gas terminal to the Maine border.

It has been reported that the Irving-Repsol consortium could stand to make $40 billion to $60 billion over the next 25 years by bringing in supercooled gas from countries such as Trinidad and Algeria and then regasifying it for shipment.

"If the pipeline follows the sensible marine route, there will be no risk to the citizens but there will be extra cost and less profit for the corporations," said Mr. Jory.

Emera announced in May it was taking over construction of the pipeline from Duke Energy, which originally proposed building it. The pipeline company has argued putting a line under the Bay of Fundy would add $300 million to construction costs.

Opposition to the project was voiced by eight other Saint John residents who appeared before the energy board, which is reviewing an application by Emera Brunswick Pipeline, an Emera subsidiary, to build a 145-kilometre pipeline to connect Irving’s Canaport liquefied natural gas plant to American markets.

Saint John nurse Lorna Secord said she "vehemently" opposes a pipeline 76 centimetres in diameter going through her neighbourhood.

"The proposed plan to rip up our neighbourhoods, our park, our streets in order to construct this huge pipeline is unbelievable to me," she said.

Another resident, Ray MacMullin, questioned the potential loss of pipeline toll revenue by allowing Irving and Repsol to use a new line instead of the existing one that moves Sable gas from Nova Scotia to the U.S.

The public hearings are expected to continue until Nov. 20.

( jmyrden@herald.ca)

’The proposed plan to rip up our neighbourhoods, our park, our streets in order to construct this huge pipeline is unbelievable to me.’

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TheChronicleHerald.ca

HALIFAX, NOVA SCOTIA | Friday November 10, 2006

N.S. government confused over N.B. pipeline

By ROGER TAYLOR Business Columnist

IS THE NOVA SCOTIA government fighting tooth and nail to block the creation of the $350-million so-called bullet pipeline in New Brunswick, as it claims, or is it just putting on a show?

It appears at least a couple of Nova Scotia government departments have differing views on the validity of the New Brunswick pipeline project.

Nova Scotia Business Inc., for example, has been fighting hard to assist Anadarko Petroleum or another energy company to build a $650-million liquefied natural gas receiving plant at Bear Head, Richmond County.

Some people — including Anadarko executives — are under the impression the Nova Scotia Energy Department believes the New Brunswick pipeline might help deliver gas to Nova Scotia. Therefore, those observers suggest, Nova Scotia isn’t trying that hard to block the pipeline.

There is also a separate LNG petrochemical project in Goldboro, Guysborough County, being spearheaded by private interests.

Maple LNG, Suntera and Halifax-based Keltic Petrochemicals have plans that call for liquefied natural gas to be used as feedstock for the $4.5-billion petrochemical plant, which includes a gas storage facility, demethanizing units and power co-generation units.

The proposal also calls for the exportation of degasified liquefied natural gas to the U.S. via the Maritimes and Northeast pipeline.

The proponents of the Goldboro project were not commenting on Thursday, but many people fear the construction of New Brunswick’s so-called bullet pipeline would be a fatal blow for its project.

Still, most observers familiar with the liquefied natural gas proposals in Nova Scotia believe the New Brunswick bullet pipeline has the potential of making Nova Scotia’s projects economically unfeasible.

Emera Inc.’s pipeline in New Brunswick would connect the Canaport LNG terminal in Saint John with the Maritimes and Northeast pipeline, but only after it crossed the border at St. Stephens, N.B.

Such a move would give liquefied natural gas in New Brunswick an advantage over natural gas coming from Nova Scotia because the owners of the gas would be spared from paying tolls on the Canadian leg of the Maritimes and Northeast pipeline.

That pipeline was built on the principle that transmission costs for everyone would be driven down if more gas producers used the line.

If Irving and Repsol YPF were to use the Maritimes and Northeast pipeline on the Canadian side, they would be assisting their competitors in Nova Scotia to transmit gas to New England more cheaply.

From a Nova Scotia government revenue perspective, the more users who drive down the toll costs of the Maritimes’ pipeline, the better.

That’s because Nova Scotia’s royalty regime is based on a "net back" principle; the cheaper it is for the offshore producers to deliver their gas to market, the more the Nova Scotia government will receive in royalties.

Meanwhile, notes taken during a conference call have been leaked and they reportedly suggest provincial Energy Department officials believe the only way Nova Scotia could guarantee itself a supply of natural gas in the future would be to accept the bullet pipeline and not vigorously oppose it.

Such a decision runs counter to the determination of Nova Scotia Business Inc. and the people who are trying to develop the industrial sector in the Strait area.

While controversy brews here, the National Energy Board continues with hearings in Saint John. But the board had already decided it was going to focus on the merits of the bullet pipeline alone and not take into consideration the economic impact it might have on the Maritimes and Northeast pipeline.

A flawed decision, if you ask me. If it weren’t for the Sable project and the need to construct an overland pipeline to New England, the Canaport project would not have a pipeline to connect to on the U.S. side of the border.

Another irony is that the New Brunswick government stretched out the original board hearings into the construction of the Maritimes and Northeast pipeline because it argued for — and won — a Maritimes and Northeast Pipeline lateral to Saint John.

It is also a little ironic that Halifax-based Emera, parent of Nova Scotia Power Inc., is building the bullet, even thought it undermines future developments in its home province.

Maritimes and Northeast is 77.53 per cent owned by Duke Energy, 12.92 per cent owned by Emera Inc. and Exxon Mobil Corp. holds a 9.55 per cent interest.

I recall Emera obtained its share after the Nova Scotia government argued for greater Nova Scotia participation in the pipeline project.

Maritimes and Northeast also speaks on behalf of Emera about the bullet pipeline, although Emera is supposedly the only company involved in building the New Brunswick pipeline.

The Nova Scotia government put a release on Thursday evening in an attempt to remove any confusion over whether or not it supports the New Brunswick pipeline, but even that fails to cut it. And where are Nova Scotia’s representatives at the federal level?

This appears to be a major blunder by the Nova Scotia government that can only be described as outrageous.

( rtaylor@herald.ca)

Roger Taylor’s column appears Tuesday, Wednesday, Friday and Saturday.


TheChronicleHerald.ca

HALIFAX, NOVA SCOTIA | Thursday November 9, 2006

Province giving up on LNG plant?

Tories now supporting N.B. project, meeting minutes show
By JUDY MYRDEN Business Reporter

SAINT JOHN — The Nova Scotia government appears to have written off a $650-million energy project in the Strait of Canso.

Nova Scotia’s deputy energy minister had a telephone conference call last Friday with other government staff and Anadarko Petroleum, developers of a liquefied natural gas plant near Port Hawkesbury, to discuss the province’s position at upcoming regulatory hearings into a controversial pipeline to be built for a competing project in New Brunswick.

The conversation took place three days before National Energy Board hearings got underway, and during the call the deputy energy minister, Allison Scott, apparently said the province would support the $350-million Emera Brunswick Pipeline as the only way to get new supplies of natural gas to Nova Scotia, according to minutes of the meeting obtained by The Chronicle Herald.

Opposing the 145-kilometre gas pipeline, which would bypass an existing pipeline, would not change the outcome of the board’s decision, Ms. Scott reportedly said.

For Anadarko Petroleum of Houston, which has been working on the project for three years, this was a reversal of Nova Scotia’s position.

"We were hoping to be aligned with the province on issues related with the Brunswick pipeline. Last week they were saying something different, and now the province may be pulling back and not as supportive," Dave Anderson, Anadarko spokesman, said Wednesday from Houston.

Mr. Anderson confirmed the telephone conversation took place last Friday afternoon and said Anadarko’s lawyer, Bernie Roth of Calgary, participated.

He said the province is sending "mixed signals" and regretted the position now being taken by Nova Scotia. Anadarko Petroleum has argued its project in Nova Scotia will be placed at a competitive disadvantage if the Emera Brunswick Pipeline is approved with cheaper transportation tolls.

Anadarko has submitted evidence that the Emera pipeline will offer Irving Oil and its partner, Repsol, a $1.5-billion transportation advantage for their proposed LNG plant outside Saint John.

The Anadarko project has been in limbo since it was unable to find a gas supply and a deal to sell the permitted site in September collapsed.

Ms. Scott apparently said during the conference call that the Canaport LNG terminal has a better chance of getting a supply than Anadarko’s project at Bear Head, near Port Hawkesbury.

Three days after the conversation, on Monday, the Energy Department issued a news release on the opening day of the hearing, saying the government would "aggressively" defend the interests of Nova Scotians.

"Nova Scotia projects should not be put at an unfair competitive disadvantage by this new pipeline," Energy Minister Bill Dooks said in the release.

Port Hawkesbury Mayor Billy Joe MacLean, attending the hearings as an observer, said he was upset after learning about the conversation and wondered whether the Energy Department would really defend Nova Scotia interests at the hearing.

"We have three industries depending on LNG coming into the Strait of Canso that would affect 500 to 600 jobs and I’m up here trying to defend that, and I don’t think it is good idea to run this pipeline through the centre of the city," Mr. MacLean said outside the hearing room Wednesday.

The government has sent a lawyer and another Energy Department representative to intervene at the hearings, which are scheduled to run until Nov. 20.

A department spokeswoman confirmed the telephone conversation took place but would not discuss details, saying it was a private conversation.

The hearings continue today.

( jmyrden@herald.ca)

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TheChronicleHerald.ca
HALIFAX, NOVA SCOTIA | Friday November 10, 2006


When asked Thursday for Nova Scotia’s position on the proposed pipeline, Premier Rodney MacDonald wouldn’t say whether he’s in favour or opposed. (File)


Tories try to clarify stance on N.B. pipeline
Conservatives say position is clear but opposition parties disagree

By DAVID JACKSON and JUDY MYRDEN Staff Reporters

The MacDonald government is trying to set the record straight about its position on a proposed pipeline in New Brunswick that could threaten a $650-million energy project in Nova Scotia.

According to minutes of a conference call Friday involving deputy energy minister Alison Scott, other government representatives and Anadarko Petroleum, the firm interested in a liquefied natural gas plant at Bear Head, Richmond County, Ms. Scott said the province would back the Emera Brunswick pipeline as the only way to get natural gas to Nova Scotia.

Opposition critics hammered Mr. Dooks at Province House for Ms. Scott’s comments. Neither he nor Premier Rodney MacDonald denied the comments.

"I cannot make comment in regards to that because I’m not aware, I wasn’t a part of the conversation," Mr. Dooks told reporters after question period.

Mr. Dooks talked to Ms. Scott later in the afternoon.

The Energy Department then issued a news release that said: "Mr. Dooks said Ms. Scott denies the allegation."

Mr. MacDonald said he understood there were no official minutes of the conference call, but Port Hawkesbury Mayor Billy Joe MacLean offered to show them to the premier.

Mr. MacLean said the deputy minister made it clear the Nova Scotia government will be supporting the competing proposal in New Brunswick for Irving Oil and Spanish-based Repsol’s LNG terminal, to be in service in 2008.

Mr. MacLean said the minutes reveal "very clearly" that Ms. Scott says the province should "get behind the Irving project and the Anadarko project is dead."

That runs contrary to a government release issued Monday, the first day of the National Energy Board hearing into the Emera proposal, saying the government would "aggressively" defend the interests of Nova Scotia at the hearing.

"He should do his own research and respond accordingly to statements made by his deputy that are really aggravating everybody in Nova Scotia," Mr. MacLean said outside the hearing Thursday afternoon.

When asked for Nova Scotia’s position on the proposed pipeline, Mr. MacDonald wouldn’t say whether he’s in favour or opposed.

"The position very clearly is that anything that would negatively impact a potential Nova Scotia project and negatively impact consumers, yes I’d definitely be against," he said.

Mr. Dooks said in the release that the government’s position hasn’t changed.

"We will drive home our point to the National Energy Board that Nova Scotians must be able to use gas from the Canaport facility at fair prices and that Nova Scotia projects should not be put at an unfair competitive disadvantage by this proposed pipeline," the minister said.

NDP energy critic Frank Corbett said the confusion over Nov Scotia’s position threatens potential energy projects in Bear Head and Goldboro, Guysborough County.

"They’ve got to come clean with this conversation so Nova Scotians will know who supports who," he said.

Interim Liberal Leader Michel Samson said Ms. Scott’s apparent comments make it even harder for Anadarko to find a supply of gas for its project.

"To have a deputy minister be offside with where this province is going has sent a chill throughout this whole industry," he said.

The Liberals are calling for Ms. Scott and others in the Energy Department to appear before the legislature’s public accounts committee.

Nova Scotia is intervening at the hearing with government lawyer Stephen McGrath and another department representative.

As of Thursday, after four days of hearings Mr. McGrath has not had an opportunity to ask any questions about the proposal. His turn may come today or Monday, but 28 other interveners are still ahead of Nova Scotia, a board spokeswoman said.

In answering a question on the issue in question period, Mr. Dooks tried to put another issue behind him.

Opposition MLAs have needled him about his remark last month that the wind could stop blowing. Mr. Dooks had tabled documents that referred to the wind energy industry being concerned when there isn’t enough wind to generate power.

"I think it’s time to allow that comment to rest. I said publicly that I regret saying that," he said.

"It is a term is used in the industry."

( djackson@herald.ca)

( jmyrden@herald.ca)

’The position very clearly is that anything that would negatively impact a potential Nova Scotia project and negatively impact consumers, yes I’d definitely be against.’

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Anonymous said...

NS is just full of sour grapes. Let's face it, with the pipeline, Point Lepreau refurbishment, and the Irving Refinery Part Deux, economic development in NS is going to take a backseat to development in NB. NS has been supposedly working on this for YEARS with ZERO results... if they had put their $$ where their mouth was, maybe they would have something to talk about.