Woodfibre LNG Agreement Answers Clean Energy Needs and Drives Jobs

According to Energy Information Administration (EIA), China is attempting to use more natural gas to reduce air pollution and carbon dioxide emissions, which are largely caused by coal and oil usage for energy. Underpinned by large investments in domestic gas production and infrastructure, along with growing imports, the Chinese government anticipates increasing its gas share of total energy consumption to around 8% by year end 2015 and to 10% by 2020. In 2012, natural gas accounted for only 4.9% of China’s total energy consumption.

In fact, besides China, it has become a global awareness to support the consumption and production of clean energy in order to ensure sustainability of resources. New entrepreneurs these days are also looking into clean energy innovations or coming up with business ideas that do good for the environment and profitable at the same time. Woodfibre LNG, a subsidiary of Pacific Oil & Gas, which is in turn part of the RGE Group of companies headed by Sukanto Tanoto, has recently signed an agreement with Chinese province of Guangdong, to support their demand for LNG for the next 25 years.

Near the end of September 2014, the Chinese province of Guangdong announced the opening of a trade office in Vancouver, Canada, that will serve as the first of its kind in that country. This move also coincides with the signing of a preliminary offtake agreement between Guangzhou Gas Group Co Ltd and Woodfibre LNG, a Singapore-based firm that plans to export liquefied natural gas from western Canada. Guangzhou is the capital and largest city in Guangdong Province.

Woodfibre LNG and Guangzhou Signing of MOU
Guangzhou Gas Group Co. Ltd. and Woodfibre LNG have signed a memorandum of understanding (MOU), outlining a long-term stable supply of natural gas to meet Guangzhou City’s gas demands starting in 2017 (targeted date).

British Columbia’s premier, Christy Clark (2nd row, 3rd from right), has supported both the increased Chinese trade presence in her province and her government’s developing relationship with Woodfibre. The Woodfibre-Guangzhou agreement highlights the growing strength of the Tanotos’ plans to establish an LNG export hub in the town of Squamish, near Vancouver.

The Woodfibre agreement with Guangzhou will cover close to one-half of the Singapore company’s planned yearly output of liquefied natural gas. The terms state that Woodfibre, currently working with the goal of starting operations in 2017, will provide Guangzhou with 1 million tonnes of natural gas per year for 25 years. China is the world’s third-largest importer of natural gas, and its urban areas along the coast account for much of its demand Click here for more information.

Woodfibre’s planned site, at the location of a defunct pulp mill, has optimal access to existing infrastructure such as industrial zoning, a deep-water port, a gas pipeline, and a functioning power grid. Company executives also point to the environmental benefits of the construction of a FortisBC gas pipeline partly through a pre-existing route. Clark, in turn, has extolled the LNG industry’s capacity to create new jobs in the province and Woodfibre estimates that its project in Squamish will create 500 jobs in construction and 100 full-time staff positions.

Advertisements