North Montney Mainline project approval brings Pacific NorthWest LNG closer to reality

The NEB has recommended approval of the North Montney Mainline Project, moving Petronas one step closer to making a positive FID

Canada’s National Energy Board (NEB) has recommended approval of the $1.7 billion North Montney Mainline Project, effectively moving Petronas one step closer to making a positive final investment decision (FID) on the Pacific NorthWest LNG (PNW LNG) project.

The certificate would be issued to NOVA Gas Transmission Ltd. (NGTL) and the mainline project would be built by TransCanada. Should the project go ahead, the 301-kilometre pipeline would link Progress Energy’s gas fields into a natural gas grid and provide a link into the TransCanada pipeline that would go from the North Montney area all the way into Prince Rupert.

The NEB found that with its 45 conditions and implementation of NGTL’s environmental protection procedures and mitigation, the project is not likely to cause significant environmental effects.

This is a step in the right direction, PNW LNG senior adviser, corporate affairs Spencer Sproule told Business in Vancouver, but there are more hurdles that must be cleared before a positive FID.

“We remain in the Canadian environmental assessment process,” Sproule said.

“A regulatory decision from the Government of Canada is the next step.”

Some of the 45 conditions that must be met relate to pipeline integrity, environmental protection and First Nations consultation.

In the past several months, PNW LNG has finalized its project development agreement with the Government of British Columbia and received a provincial environmental assessment certificate.

“While great strides are being made to bring fiscal and regulatory certainty to our project, in order to achieve a positive FID, Canadian LNG will need to be competitive with other supply sources available to the Asian Markets,” said Michael Culbert, president and CEO of Progress Energy Canada and PNG LNG.  

- With files from Daily Oil Bulletin