Connect with us
[the_ad id="89560"]

Canadian Energy Centre

Qatar breaks ground on massive LNG expansion, Canada’s full potential remains untapped

Published

4 minute read

From the Canadian Energy Centre

By Deborah Jaremko

‘By embracing Canadian LNG, we can play a crucial role in providing affordable, secure, and cleaner energy sources’

The world’s largest LNG project is officially underway, with the ceremonial foundation stone laid by Qatar’s Amir Sheikh Tamim bin Hamad Al Thani on October 3. 

Already one of the world’s largest LNG exporters, the North Field expansion will increase Qatar’s LNG production capacity from 77 million tonnes per year today to 126 million tonnes per year by 2026. 

“This major expansion comes at a crucial time, as natural gas occupies a pivotal position in the energy mix in a world facing geopolitical turbulences and is in dire need of clean energy sources that are in line with the global environmental goals,” said Saad Sheirda Al-Kaabi, Qatar’s minister of energy and CEO of QatarEnergy. 

LNG exports, which Qatar commenced in 1997, have helped elevate the country’s economy and society, says Racim Gribaa, president of Calgary-based Global LNG Consulting.  

Gribaa has worked in energy for more than two decades, engaging with governments and industry in LNG developments around the world including Canada and Qatar.  

“Qatar is a visionary nation that transcended poverty to prosperity through strategic planning and foresight. From humble beginnings in pearl fishing, it has emerged as one of the world’s wealthiest nations, a leader in LNG exports,” he says. 

Canada is the world’s fifth largest natural gas producer but is not yet an LNG exporter.  

LNG Canada will be the first export terminal, with capacity of 14 million tonnes per year. Construction is about 85 per cent complete and on track to start shipments by 2025, the project said in July. Construction of the smaller 2.1 million tonne per year Woodfibre LNG terminal is set to begin this fall. 

These are promising steps demonstrating Canada’s potential, Gribaa says. But more can be done. 

“By embracing Canadian LNG, we can play a crucial role in providing affordable, secure, and cleaner energy sources, thus benefiting nations while mitigating the adverse impacts of coal dependency,” he says. 

Driven by expanding economies in Asia, world LNG trade has increased by more than 200 per cent since 2000, reaching 401 million tonnes in 2022, according to the International Gas Union.  

Demand is expected to continue increasing, rising above 700 million tonnes in 2040, according to Shell’s latest industry outlook. This is due to population growth, expanding economies and the need to reduce reliance on coal-fired power.  

Switching from coal to natural gas to generate power reduces emissions on average by about 50 per cent, according to the International Energy Agency. LNG from Canada can deliver an even bigger decrease, reducing emissions by up to 62 per cent, according to a June 2020 study published in the Journal for Cleaner Production. 

Switching power generation to LNG can also significantly reduce particulate emissions, Gribaa notes.  

“LNG is a fundamental part of the solution in achieving sustainable energy goals worldwide,” he says. 

“There exists a considerable untapped potential for Canada (Montney, Duvernay, Horn River and Liard basins) to bolster its involvement and position itself as a key player in addressing the challenges posed by climate change and energy sustainability on a global scale.” 

Alberta

The beauty of economic corridors: Inside Alberta’s work to link products with new markets

Published on

From the Canadian Energy Centre

Q&A with Devin Dreeshen, Minister of Transport and Economic Corridors

Devin Dreeshen, Alberta’s Minister of Transportation
and Economic Corridors.

CEC: How have recent developments impacted Alberta’s ability to expand trade routes and access new markets for energy and natural resources?

Dreeshen: With the U.S. trade dispute going on right now, it’s great to see that other provinces and the federal government are taking an interest in our east, west and northern trade routes, something that we in Alberta have been advocating for a long time.

We signed agreements with Saskatchewan and Manitoba to have an economic corridor to stretch across the prairies, as well as a recent agreement with the Northwest Territories to go north. With the leadership of Premier Danielle Smith, she’s been working on a BC, prairie and three northern territories economic corridor agreement with pretty much the entire western and northern block of Canada.

There has been a tremendous amount of work trying to get Alberta products to market and to make sure we can build big projects in Canada again.

CEC: Which infrastructure projects, whether pipeline, rail or port expansions, do you see as the most viable for improving Alberta’s global market access?

Dreeshen: We look at everything. Obviously, pipelines are the safest way to transport oil and gas, but also rail is part of the mix of getting over four million barrels per day to markets around the world.

The beauty of economic corridors is that it’s a swath of land that can have any type of utility in it, whether it be a roadway, railway, pipeline or a utility line. When you have all the environmental permits that are approved in a timely manner, and you have that designated swath of land, it politically de-risks any type of project.

CEC: A key focus of your ministry has been expanding trade corridors, including an agreement with Saskatchewan and Manitoba to explore access to Hudson’s Bay. Is there any interest from industry in developing this corridor further?

Dreeshen: There’s been lots of talk [about] Hudson Bay, a trade corridor with rail and port access. We’ve seen some improvements to go to Churchill, but also an interest in the Nelson River.

We’re starting to see more confidence in the private sector and industry wanting to build these projects. It’s great that governments can get together and work on a common goal to build things here in Canada.

CEC: What is your vision for Alberta’s future as a leader in global trade, and how do economic corridors fit into that strategy?

Dreeshen: Premier Smith has talked about C-69 being repealed by the federal government [and] the reversal of the West Coast tanker ban, which targets Alberta energy going west out of the Pacific.

There’s a lot of work that needs to be done on the federal side. Alberta has been doing a lot of the heavy lifting when it comes to economic corridors.

We’ve asked the federal government if they could develop an economic corridor agency. We want to make sure that the federal government can come to the table, work with provinces [and] work with First Nations across this country to make sure that we can see these projects being built again here in Canada.

Continue Reading

Alberta

Alberta’s massive oil and gas reserves keep growing – here’s why

Published on

From the Canadian Energy Centre

By Deborah Jaremko

Q&A with Mike Verney, executive vice-president, McDaniel & Associates

New analysis commissioned by the Alberta Energy Regulator has increased the province’s natural gas reserves by 440 per cent, bumping Canada into the global top 10.

Alberta’s oil reserves – already fourth in the world – also increased by seven billion barrels.

The report was conducted by Calgary-based consultancy McDaniel & Associates. Executive vice-president Mike Verney explains what it means.

CEC: What are “reserves” and why do they matter?

Verney: ​​Reserves are commercial quantities of oil and gas to be recovered in the future. They are key indicators of future production potential.

For companies, that’s a way of representing the future value of their operations. And for countries, it’s important to showcase the runway they have in terms of the future of their oil and gas.

Some countries that have exploited a lot of their resource in the past have low reserves remaining. Canada is in a position where we still have a lot of meat on the bone in terms of those remaining quantities.

CEC: How long has it been since Alberta’s oil and gas reserves were comprehensively assessed?

Verney: Our understanding is the last fully comprehensive review was over a decade ago.

CEC: Does improvement in technology and innovation increase reserves?

Verney: Technological advancements and innovation play a crucial role in increasing reserves. New technologies such as advanced drilling techniques (e.g., hydraulic fracturing, horizontal drilling), enhanced seismic imaging and improved extraction methods enable companies to discover and access previously inaccessible reserves.

As these reserves get developed, the evolution of technology helps companies develop them better and better every year.

CEC: Why have Alberta’s natural gas reserves increased?

Verney: Most importantly, hydraulic fracturing has unlocked material volume, and that’s one of the principal reasons why the new gas estimate is so much higher than what it was in the past.

The performance of the wells that are being drilled has also gotten better since the last comprehensive study.

The Montney competes with every American tight oil and gas play, so we’re recognizing the future potential of that with the gas reserves that are being assigned.

In addition, operators continue to expand the footprint of the Alberta Deep Basin.

CEC: Why have Alberta’s oil reserves increased?

Verney: We discovered over two billion barrels of oil reserves associated with multilateral wells, which is a new technology. In a multilateral well, you drill one vertical well to get to the zone and then once you hit the zone you drill multiple legs off of that one vertical spot. It has been a very positive game-changer.

Performance in the oil sands since the last comprehensive update has also gone better than expected. We’ve got 22 thermal oil sands projects that are operating, and in general, expectations in terms of recovery are higher than they were a decade ago.

Oil sands production has grown substantially in the past decade, up 70 per cent, from two million to 3.4 million barrels per day. The growth of several projects has increased confidence in the commercial viability of developing additional lands.

CEC: What are the implications of Alberta’s reserves in terms of the province’s position as a world energy supplier?

Verney: We’re seeing LNG take off in the United States, and we’re seeing lots of demand from data centers. Our estimate is that North America will need at least 30 billion cubic feet per day of more gas supply in the next few years, based on everything that’s been announced. That is a very material number, considering the United States’ total natural gas production is a little over 100 billion cubic feet per day.

In terms of oil, since the shale revolution in 2008 there’s been massive growth from North America, and the rest of the world hasn’t grown oil production. We’re now seeing that the tight plays in the U.S. aren’t infinite and are showing signs of plateauing.

Specifically, when we look at the United States’ largest oil play, the Permian, it has essentially been flat at 5.5 million barrels per day since December 2023. Flat production from the Permian is contrary to the previous decade, where we saw tight oil production grow by half a million barrels per day per year.

Oil demand has gone up by about a million barrels a day per year for the past several decades, and at this point we do expect that to continue, at the very least in the near term.

Given the growing demand for oil and the stagnation in supply growth since the shale revolution, it’s expected that Alberta’s oil sands reserves will become increasingly critical. As global oil demand continues to rise, and with limited growth in production from other sources, oil sands reserves will be relied upon more heavily.

Continue Reading

Trending

X