Page 7 - NorthAmOil Week 12 2023

NorthAmOil COMMENTARY NorthAmOil

variable history. In 2021 Repsol – the 75% owner gas pipelines was not “very realistic”, he added.
– bought out Irving’s 25% stake and became the “Repsol is probably the fastest project that
sole owner. At the time it was named the Cana- could be deployed because it requires minimal
port LNG import terminal and had a capacity of permitting – there’s already an existing facility,
1.2 bcf (34.0 mcm) per day of imports. (and a) gas line is right there,” he reportedly said.
But five years before that, Repsol and Irving
had decided against a plan to retool the existing Back and forth
import terminal because of low gas prices and In Repsol’s most recent second quarter earnings
the high cost of converting the terminal to ship call in July 2022, the company’s head of inves-
LNG for export. The owners had unsuccessfully tor relations, Ramon Alvarez-Pedrosa, said the
sought new investors, which at the time was company had met with authorities in “some
seen as because of the estimated cost of the ret- European countries,” such as Germany.
rofit of CAD4bn ($3bn). Alvarez-Pedrosa cautioned that an offtake
In later years, Repsol planned to add an agreement for 15-20 years would be necessary
export terminal instead of undergoing a retool- to proceed, as well as a “competitive” toll frame-
ing facility. work for imports of Western Canada gas. “I’m
The export facility had been touted by Cana- talking of things that are not in our hands,” he
dian Prime Minister Justin Trudeau’s office as said. “But, it could be…possible in the frame- Most of Canada’s
helpful for various European countries. “Specif- work of the energy crisis we are seeing.” At the
ically, we note the potential of Repsol’s…facility time, Europe was urgently seeking new sources natural gas is
in Saint John, New Brunswick, to eventually of gas. produced in
export LNG to Europe,” the office said in June But by August 2022, when German Chan-
2022. “Spain’s LNG regasification plants may cellor Olaf Scholz visited Ottawa hoping for an Western Canada.
provide needed capacity to support efforts to LNG commitment, Trudeau and his govern-
reduce European reliance on Russian energy.” ment had started wavering about exports to
In June 2022, Canada’s Minister of Envi- Europe.
ronment, Steven Guilbeault, told Reuters that Trudeau’s Liberal government, under pres-
Repsol’s LNG terminal was the fastest way sure to reduce reach climate goals and green-
for Canada to increase the supply of gas to house gas (GHG) emissions, was starting to
Europe. question LNG exports from Canada’s East Coast
But Guilbeault had also cautioned that Can- publicly. At a joint press conference with Scholz,
ada’s East Coast only had enough imported gas Trudeau said there had “never been a strong
for one LNG export terminal, and Repsol’s New business case” for LNG terminals on Canada’s
Brunswick project could be brought online first. East Coast.
Pieridae Energy has been proposing an LNG And just days before the German chancellor
facility in neighbouring Nova Scotia. arrived, in August 2022, Canada’s Minister of
“The amount of gas that is available would be Natural Resources, Jonathan Wilkinson, told
available only for one facility at this point,” Guil- Reuters that Canada’s government preferred to
beault told the news service. Constructing new export hydrogen to Europe rather than LNG.™

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