Canaport TM LNG Project Update

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Diane Carpenter
5 years ago
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1 Canaport TM LNG Project Update FERC Technical Conference Regarding Maritimes & Northeast Pipeline Gas Quality Specifications Vince Morrissette Vice President of Origination and Regulatory Affairs Repsol Energy North America July 15,

2 Discussion Topics Canaport TM LNG Facility Overview LNG Supply Update Related Pipeline Facilities Canaport TM Benefits Conclusions 2

3 Canaport TM LNG Facility Description Location - Saint John, New Brunswick Year round ice-free port 85-foot water depth at low tide (LNG tankers require ~45 feet of depth) Capable of receiving the largest LNG vessels (~5.7 Bcf gas equivalent) Discharge Capacity 1.2 Bcf/day maximum, expandable to over 2.0 Bcf/day Storage Capacity total of 9.9 Bcf gas equivalent (three tanks), expandable to 16.5 Bcf with the addition of 2 tanks Construction Progress Outer tank walls are in place for all 3 tanks. Hydro-testing of tank 1 will commence during next few weeks, and tank 2 hydro-testing will commence one month afterwards. Onshore facilities are 8 complete; offshore facilities are complete. Total Cost: ~$1 billion 3

4 Canaport TM Project Overview Quebec M&NP (Canada) M&NP (USA) Quebec City New Brunswick Fredericton Prince Edward Island Existing Compressor Stations Brunswick Pipeline New Compressor Stations Maine Moncton CANAPORT LNG VT PNGTS Bangor Saint John Westbrook Portland Brunswick Pipeline Nova Scotia Halifax 10 of Canaport LNG capacity (~1 Bcf/day) contracted by Repsol Energy Canada NH Dracut MA Tennessee Beverly Boston Algonquin 10 of firm capacity on Brunswick Pipeline contracted by Repsol Energy Canada ~0.73 Bcf/day of firm capacity on M&NP contracted by Repsol Energy North America Startup in 4 th Quarter

5 5 Facility Rendition

6 6 Progress through June 2008

7 LNG Supply LNG purchase contract is in place with a Repsol affiliate: 25-year term Volumes up to 1.0 Bcfd (gas equivalent) Delivered Ex-ship (DES) LNG sale Sourced from Repsol affiliate s LNG supply portfolio Initial LNG supply will likely be sourced from Trinidad. LNG supply also will be sourced from additional locations and may be purchased directly from third parties. All re-gasified LNG from Canaport must conform to M&NP gas quality specifications. 7

8 Representative Gas Quality Specs M&NP (max) Trinidad Algeria Qatar Libya Abu Dhabai Nigeria Oman HHV Wobbe C1 n/a 96.1% 91.1% 90.6% 86.5% % 84.2% C2+ 12% 3.9% 8.3% 8.9% 12.7% % 15.8% CO2 + N2 4% CO2 2% N2 n/a O2 0.2% N2 + O2 2.75% Actual specs may vary within a reasonable tolerance 8

9 Pipeline Facilities Canada: Emera Brunswick Pipeline (new) Approximately 90 miles of 30 pipeline from Canaport TM LNG to an interconnect with M&NP at the US / Canada border Construction commencement during November year contract in place with Repsol Energy Canada for all firm capacity Total cost: ~$465 million (US) US: Maritimes & Northeast Pipeline Expansion 5 new compressor stations (~100,000 total horsepower), compressor and meter station modifications, and 1.7 miles of new 30 pipeline Construction commencement during July year contract in place with Repsol Energy North America for ~0.73 Bcf/day of firm capacity delivered to Dracut and Beverly, MA Total cost: ~$321 million 9

10 10 Emera Brunswick Pipeline Construction

11 11 Maritimes & Northeast Pipeline Construction

12 Canaport TM LNG Benefits Provides new source of safe, clean, and efficient gas supply to growing Northeast U.S. energy market; 1 Bcf of gas is enough to: Generate the electricity required daily to power more than 5 million homes Serve twice the average daily home heating demand of all six New England states combined Serve the entire State of New York s daily residential gas demand Gives LNG suppliers flexible and reliable access to gas deficient Northeast U.S. Supplements declining Western and Maritimes Canada gas production Back-feeds the capacity constrained Northeast U.S. pipeline grid Mitigates force majeure curtailment risk associated with domestic gas supply sources (Gulf of Mexico, Sable Island, etc.) Promotes competition in the marketplace by providing the foundation for Repsol to offer flexible gas trading and origination services to wholesale gas markets in Canada and the U.S. 12

13 Conclusions Repsol has made a very substantial long-term financial commitment to provide a new source of reliable natural gas supply to Maritimes Canada and the Northeast U.S. Repsol has accepted the elimination of many LNG supply sources for Canaport due to the stringent but fair gas quality specifications that have been proposed by M&NP. Repsol strongly supports the gas quality specifications that have been proposed by M&NP: Conform to NGC+ guidelines Maintain integrity of previous pipeline specs while providing more favorable limits for end-users with respect to inert elements Limit access to some LNG supply sources, while providing access to sufficient sources of Atlantic basin LNG supply Represent a fair compromise between the needs of the pipelines, endusers, and gas/lng suppliers 13

Open Season Guidelines

C04-ANA 2.4 (a) Attachment Maritimes & Northeast Pipeline Expansion Project Open Season Guidelines February 15 to March 31, 2005 Maritimes & Northeast Pipeline is ideally situated to expand in order to