Resource World Magazine

O C T O B E R / N O V E M B E R 2 0 1 9 www.resourceworld.com 65 Woodfibre LNG moving closer to construction start Key milestones achieved this summer by Woodfibre LNG, a subsidiary of Pacific Oil and Gas Ltd. (PO&G), were the acquisition of a British Columbia Oil and Gas Commission Facilities Permit, plus the signing of a long-term offtake agreement with BP Gas Marketing Ltd. and the company's purchase of Canbriam Energy Inc., a world-class natural gas supplier in northeastern BC. The company is in the final stages of contract negotiations with a con- struction firm and then should be able to announce a Final Investment Decision. Construction is expected to start by the end of 2019, with delivery to begin in 2023. "We are very close to breaking ground on the cleanest LNG export facility in the world," said Woodfibre spokesperson Rebecca Scott. "The Canadian natural gas export opportunity is significantly closer to becoming reality – which means economic growth for Canada and offsetting dirtier sources of energy overseas. "Creating jobs here at home and combatting global climate change is a win-win, and we're looking forward to getting started." Woodfibre LNG is licensed to export about 2.1 million tonnes of liquefied natural gas annually for 40 years. The $1.8-billion plant will be located on the former Woodfibre pulp mill site on Howe Sound 7 km southwest of Squamish. The area is already zoned industrial and has a deepwater port on a waterway used for decades for commercial shipping. Proponents say an LNG carrier will travel through Howe Sound 3-4 times monthly and will increase large vessel movements in the Sound by less than 1%. In a news release, Woodfibre president David Keane said the Facilities Permit specifies requirements for design, construction and operation of the LNG plant and he noted the project already has three major environmental assessment approvals, from the federal and provincial governments, and the Squamish First Nation. "Our environmental assessment promise with the Squamish Nation is the first of its kind in Canada," he said in the release. "The progress we have made would not be possible without the contributions and feedback made by our Indigenous partners and the Squamish community." "Getting a large, resource-based infrastructure project built is tremendously difficult," said Scott. "So many pieces have to fall into place in exactly the right order at exactly the right time. But all that effort is well worth it. The regulatory system, community consultation and Indigenous relations ultimately all work together to make a much better project. "Without a doubt, we are most proud of our groundbreaking work with Indigenous groups," she added. "Our environmental approval from the Squamish Nation is the first of its kind in Canada. Woodfibre LNG has established a new model for meaningful engagement that goes beyond consultation to collaboration. We continue to hold our relationship with Indigenous communities, and the Squamish nation, in the highest regard." The agreement with BP will see Woodfibre receive 0.75 million tonnes of LNG annually over 15 years on a free on board basis, with first delivery set for 2023. The project is expected to create up to 650 construction jobs, with hiring preference given to Squamish Nation members, local area residents, British Columbians and Canadians – in that order. Once operational, the company says it will be one of the highest-paying employers in the Sea to Sky region of BC, with about 110 employees. n while Saturn is having success with its lean approach ("We only have eight people in our office"), the company doesn't want to 'duke it out ' with the major corporations. Saturn says it intends to remain focused on generating value for shareholders through the successful execution of its strategy, but in response to the continued oil price volatility, market uncertainty and the goal of maintaining financial flexibil- ity, it will defer a portion of its previously planned 2019 capital budget until prices and market conditions stabilize. As a result, Saturn says it expects its full-year 2019 capital program to be about $21.9 million, resulting in a total of 27 wells drilled, completed, equipped and tied in within its Viking light oil area, with a target exit rate for the year of approxi- mately 950 bbls/d – a 67% growth rate over its 2018 exit rate. The company's achievements in 2019 follow successes in 2018, when its capital expenditures program totalled $20.7 mil- lion and was directed to the acquisition of 26.3 net sections of land and the drilling and completion of 18 (17 net) Viking light oil wells, including 15 ERH wells. Both men said Saturn is on track for more growth, looking at more areas with larger plots of land and then develop- ing those while operating as cheaply as possible. Jeffrey said their goal is to get to 2,000 bbls/d by the end of this year, with 50-100% growth for investors, and Newman added that while there are things beyond the company's control, such as prices, "we can maximize what we do have." "Our growth is organic, old school. We simply find the land and develop it. That works," said Newman. Key to it all will be the return of share- holders to the oil and gas sector, said Jeffrey, "as they realize the future doesn't lie with cannabis (stocks) or bitcoin. Eventually, oil and gas resources will come back around." "Good times will come around again and we are ready for them." n

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