New Brunswick Premier Blaine Higgs speaks in Fredericton, N.B. on Thursday, February 9, 2023. The Spanish company behind a proposal to export liquefied natural gas to Europe through a terminal in Saint John, N.B., says it will not go ahead with the project because the costs are too high. Higgs says he is disappointed by Repsol’s decision to drop the project but not completely surprised because he was aware of issues surrounding costs.THE CANADIAN PRESS/Stephen MacGillivray
FREDERICTON — The Spanish company behind a proposal to export liquefied natural gas to Europe through a terminal in Saint John, N.B., has announced it will not go ahead with the project because the costs are too high.
New Brunswick Premier Blaine Higgs said Friday he was disappointed by Repsol’s decision to drop the project but not completely surprised because he was aware of issues surrounding costs.
“I was anticipating something that would be probably unattractive economically, but obviously disappointed in the project,” he told reporters. “At this point (they’re) certainly not able to proceed because of high costs of gas supply.”
The owner of the Saint John plant had meetings with the federal government in June on turning it into an export facility to help Europe wean itself off Russian oil and gas after the invasion of Ukraine. The plant currently imports liquefied natural gas from the United States, but plans were to retrofit it so it could export gas in about three years.
German Chancellor Olaf Scholz said last year his country was open to accepting more gas from Canada but cautioned that the economics might not make sense.
“There are a number of potential projects, including one in Saint John, and some others that are on the books for which there has never been a strong business case because of the distance from the gas fields,” Scholz said at the time.
Higgs said Repsol made it clear that the economics of transporting the gas by pipeline from Western Canada before shipping it to Europe “were just completely out of the question.”
“The components on the construction, the components on the marketability and the buyer met the criteria,” he said.
“But the gas supply component, which Repsol made very clear in their statement, did not meet the criteria, and basically made the economics not work.” The tolls to ship the gas by pipeline were “just too high” and made the project unviable, he added. Higgs said the “actual numbers” were not shared with him.
Michael Blackier, spokesman for Repsol’s Saint John plant, said the decision to scrap the liquefaction project was made following a feasibility study that found the overall costs to ship the gas to their terminal were too high.
“We won’t be providing any documentation,” he said in an email when asked for a copy of the feasibility study.
This report by The Canadian Press was first published March 17, 2023.
Hina Alam, The Canadian Press
- 0045 WBPC 2023 Bright Colors P0045 WBPC 2023 Bright Colors P
- 0044 PTRC CCUS Aquistore0044 PTRC CCUS Aquistore
- 0043 ALX ten sizes0043 ALX ten sizes
- 0042 Sask Oilfield Services0042 Sask Oilfield Services
- 0039 Summit ESP Saskatchewan lower third0039 Summit ESP Saskatchewan lower third
- 0041 DEEP Since 2018 now we are going to build0041 DEEP Since 2018 now we are going to build
- 0040 Southeast College safety tickets0040 Southeast College safety tickets
- 0033 Buffalo Potash Jared Small Footprint
- 0032 IWS Summer hiring rock trailer music
- 0029 Latus Viro updated Latus phone
- 0025 Kendalls
- 0026 Buffalo Potash Quinton Salt
- 0023 LC Trucking tractor picker hiring mix
- 0022 Grimes winter hiring
- 0021 OSY Rentals S8 Promo
- 0019 Jerry Mainil Ltd hiring dugout
- 0018 IWS Hiring Royal Summer
- 0014 Buffalo Potash What if PO
- 0013 Panther Drilling PO ad 03 top drive rigs
- 0011
- 0006 JK Junior
- 0004 Royal Helium PO Ad 02
- 9001
- 0002
Pipeline Online provides the in-depth coverage on energy issues in this province that no other media comes close to. However, with recent threats from Facebook to block news links, it’s important to follow Pipeline Online in other manners. The easiest is to check each morning at PipelineOnline.ca, with the top story posted at 7 a.m. Monday to Friday, and additional coverage throughout the day and weekend. But you can also follow on LinkedIn and Twitter. You can follow editor Brian Zinchuk online at LinkedIn as well (you’ll see more stories that way). Finally, you can subscribe to a weekly newsletter.