RBN Energy Article – Movin’ Out—Exporting U.S.-Sourced LNG from the Maritimes

With Marcellus natural gas production expected to continue increasing, several companies are proposing projects to pipe a portion of the output through New England to Canada’s Maritime Provinces, where the gas would be liquefied and exported to Europe, Latin America and maybe even Asia. Some offshore Atlantic Basin gas production from Sable Island and Deep Panuke would be mixed in too. Such plans for as many as four new LNG export facilities in Nova Scotia and New Brunswick hinge on the development of new pipeline capacity through New England to the existing Maritimes & Northeast Pipeline (MNP), which would be reversed to flow north. Is this a golden opportunity or an overreach?  Today we examine prospects for exporting Marcellus gas through new Eastern Canadian LNG facilities.

It is no secret that natural gas markets in the U.S. Northeast and the Canadian Maritimes have been turned on their heads the past few years. Back in 2000, virtually all of the gas consumed in the Mid-Atlantic States and New England was piped in long distances, mostly from the Gulf Coast, and the Sable Offshore Energy Project (SOEP) was just starting to move gas from off the Nova Scotia coast down into New Brunswick and New England via the new Maritimes & Northeast Pipeline (MNP). Fast-forward 14 years and Marcellus gas has come to dominate the northeastern U.S., the flow of Gulf Coast gas into the region has slowed, SOEP output is declining, and gas from Deep Panuke–the newer offshore production area in the Maritimes—is facing competition it had not expected in New England. The MNP itself, which was built primarily to move SOEP gas down to near Boston, is likely to be flowing north before long.

The Opportunity

As we said in “Is Deep Panuke Gas a Case of ‘Right Place, Wrong Time’?” gas from offshore Nova Scotia…Continue Reading