Bear Head LNG applies for construction permit extensions

HALIFAX: The company planning to build a Liquefied Natural Gas (LNG) plant, pipeline and related facilities near Bear Head, Richmond County has applied for extensions on their construction permits.

Sister companies Bear Head LNG Corporation Inc. and Bear Paw Pipeline Corporation Inc. jointly applied to the Nova Scotia Utility and Review Board (UARB) on October 4 requesting a three-year extension on their permits – which are set to expire on December 31.

John Baguley, the chief operating officer with Bear Head LNG, said in the company’s application they have been delayed in starting construction due to the difficulty in securing the necessary natural gas feedstock for the LNG facility.

“Bear Head has been negatively affected by changes in global energy market conditions since the initial permit approval,” he said. “These market condition changes include a substantial imbalance in the current LNG supply-demand situation, deferral of long-term purchase commitments by the market, and instability in energy pricing including LNG.”

As a result, it is taking longer than expected to obtain binding LNG agreements required to underpin the construction program, Baguely explained, but the companies are very optimistic they can secure the necessary feedstock during this extension period.

The companies aren’t seeking any change or modification to the terms and conditions of their respective permits other than a new term ending December 31, 2022.

Comments by interested parties are due by November 8, and reply comments by Bear Head LNG are due by November 29, and the UARB determined these matters would be reviewed by a paper process.

The permit to construct the LNG plant was originally issued by the UARB on June 6, 2006 and it was amended on March 13, 2015. The permit for the pipeline and related facilities was originally issued on Sept. 7, 2016.

Under the Pipeline Act, Energy Resources Conservation Act, Gas Plant Facility Regulations, and Pipeline Regulations, the UARB is to consider the issues of public safety only, and their mandate does not include environmental matters, nor is it the economic regulator of the companies.

In September, Bear Paw Pipeline filed its 2019 biannual benefits report with the UARB, which is required in their decision in granting a permit for the construction of the pipeline.

Documents state the company spent $269,000 in Nova Scotia during the first half of the fiscal year and this includes; about $154,221 in private consulting costs; $77,779 for site and office costs; $29,808 is listed under First Nations; $5,000 for permitting; and about $2,728 in community donations.

Last year, the biannual benefits report indicated the total expenditure in the province during the first half of the fiscal year reporting period was just below $500,000. During the peak of its planning, the company had expenditures of $5.4 million in 2016 and $1.2 million in 2017.