LNG project in N.L. could be sped up to supply Europe

Newfoundland Source: iStock/Kyle Bedell

The company behind a proposed liquefied natural gas project off Newfoundland’s coast could push forward its schedule after the Ukraine crises left Europe scrambling to find alternatives to Russian supplies. 

LNG Newfoundland and Labrador Ltd.’s C$5.5 billion project to take natural gas associated with offshore oil production and liquefy it on floating facilities at Grassy Point, could be pushed forward to start as early as 2028 from 2030 to accommodate European buyers, Leo Power, chief executive off the company, said in a phone interview. The export terminal will produce as much as 2.6 million tonnes a year of the chilled fuel.

“We would seek to expedite the schedule,” he said. “Since the invasion of Ukraine, we have had a lot of interest from prospective buyers in Europe,” including Germany. 

The project would be advantaged in that Newfoundland is almost half the distance to Europe than LNG terminals in the Gulf of Mexico and the plant would be powered by hydropower, keeping emissions minimal, Power said.  

The Canadian government is in discussions with European countries about eventually supplying them with LNG, Jonathan Wilkinson, natural resources minister, said last week. The discussions are taking place even though Canada currently doesn’t have any LNG plants. While numerous projects have been proposed, just one is currently under construction off the Pacific Coast. 

Projects on the Atlantic have faced their own challenges. A proposal by Énergie Saguenay for an LNG plant in Quebec was rejected by both the federal and provincial governments. Pieridae Energy Ltd.’s plan for an LNG plant in Nova Scotia that would use gas from Alberta is looking for an equity investor to move forward, chief executive Alfred Sorensen said by phone.

© 2022 Bloomberg L.P.

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