The Goldboro LNG plant scheme has collapsed

News

1. The Goldboro LNG plant scheme has collapsed

In a statement issued this morning, Pieridae Energy declared its proposed Goldboro LNG plant “impractical”:

While Pieridae has made tremendous progress in advancing the Goldboro LNG Project, as of June 30, 2021, we have not been able to meet all of the key conditions necessary to make a final investment decision. Following consultation with our Board, we have made the decision to move Goldboro LNG in a new direction. The Project’s fundamentals remain strong: robust LNG demand from Europe and high global LNG prices, Indigenous participation, a net-zero emissions pathway forward, and support from jurisdictions across Canada. This speaks to our ongoing efforts to find a partner to take advantage of these opportunities.

That said, it became apparent that cost pressures and time constraints due to COVID-19 have made building the current version of the LNG Project impractical.

We will now assess options and analyze strategic alternatives that could make an LNG Project more compatible with the current environment. In addition, the Company will continue its work to further optimize the operation and development of our extensive Foothills resources and midstream assets, including our carbon capture and sequestration and blue power development.

Pieridae continues looking for innovative ways of supplying the world with the clean natural gas it requires as a reliable bridge fuel, and providing the energy to fuel people’s lives while supporting the environment and the transition to a lower-carbon economy.

Alfred Sorensen, Chief Executive Officer, Pieridae Energy.

To be clear, Pieridae has not made “tremendous progress” progress towards developing the plant: not one shovelful of dirt has been turned, and so far as I can see, the company hasn’t gotten a penny in actual investment money towards its $14 billion (yes, billion with a B) goal, although it did enter a preposterous $206 million loan scheme; as Joan Baxter reported in April:

Pieridae financed the purchase of Shell’s aging assets at three sour gas fields in Waterton, Jumping Pound, and Caroline, with a loan of $206 million from Third Eye Capital and private placement.

One of Pieridae’s directors, Mark Horrox, is a principal of Third Eye Capital, and a director of one of its portfolio companies, Erikson National Energy, which bought about 14% of Pieridae in the private placement, a $20 million investment that is now worth just a bit more than half that.

While the parties to the loan disclosed an interest rate of 15%, the fine print in the audited statements states that Pieridae has an obligation to Third Eye Capital — namely a fee of $50 million if it does not agree to purchase some “certain petroleum and natural gas properties from Third Eye.”

In a news release issued on June 22, Pieridae spelled out the factors involved in its “forward looking statements” to investors:

In addition to other factors and assumptions which may be identified in this document, assumptions have been made regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which Pieridae operates; the timely receipt of any required regulatory approvals; the ability of Pieridae to obtain qualified staff, equipment and services in a timely and cost efficient manner; the ability of the operator of the projects which Pieridae has an interest in, to operate the field in a safe, efficient and effective manner; the ability of Pieridae to obtain financing on acceptable terms; the ability to replace and expand oil and natural gas resources through acquisition, development and exploration; the timing and costs of pipeline, storage and facility construction and expansion and the ability of Pieridae to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Pieridae operates; timing and amount of capital expenditures, future sources of funding, production levels, weather conditions, success of exploration and development activities, access to gathering, processing and pipeline systems, advancing technologies, and the ability of Pieridae to successfully market its oil and natural gas products.

Readers are cautioned that the foregoing list of factors is not exhaustive.

Indeed.

The key phrase above is “the ability of Pieridae to obtain financing on acceptable terms,” as June 30 was the deadline the German government gave Pieridae for securing additional financing in order to confirm a US$4.5 billion loan guarantee from the Germans.

As the Examiner has reported extensively, Sorensen has been going hat-in-hand to the Canadian government, asking for nearly $1 billion in financing from the Canadian public. Evidently, the federal government said “no dice,” and the entire Goldboro scheme has crumbled.

Dead On Arrival.

What about the “strategic alternatives that could make an LNG Project more compatible with the current environment”? The technical term for this comment is “bullshit.”

With no German buyer, no financing from either the German or Canadian governments, and a world that is quickly turning away from natural gas, Pieridae has at best an option on a deep-water port at Goldboro and a possible connection to a natural gas pipeline. Sorensen is an inventive fellow, so he’ll no doubt come up with yet another absurd plan for the site, but it will have to be even more convoluted than the now-dead proposal.

Sorensen may be thinking that he can still get access to natural gas produced in the Marcellus shale fracking fields in western Pennsylvania, and then transport it through the “Atlantic Bridge” of existing pipelines to a LNG plant to be built in Goldboro. Who would actually buy the gas is unclear — the Germans seem out.

The Atlantic Bridge is dependent on Enbridge’s Weymouth Compressor station, in an urban setting just nine miles from downtown Boston. The station is used to further pressurize the pipeline system, making it possible for the gas to make it all the way to Nova Scotia.

But the Weymouth Compressor is problem-plagued:

On May 20, the North Weymouth compressor had its fourth near-miss in nine months — an unplanned release of more than 11,000 cubic feet of highly pressurized gas that followed previous large leaks on September 11, September 30, and April 6. The gas spread over North Weymouth and adjoining South Quincy and Germantown. Thankfully, it did not explode. (There was another incident on May 26, when Enbridge says it vented another 11,397 cubic feet of gas in a controlled release, according to the company’s reporting to MassDEP.)

And activists are relentless in their crusade against the station, and on Tuesday staged a sit-in at Enbridge’s corporate offices in Boston:

The protest began at around 11:30 a.m. Tuesday when more than 60 activists walked into the office building that houses Enbridge’s Northeast U.S. headquarters. Some played musical instruments while others sang or chanted slogans like “we are the protectors.” Many held signs that read “Stop Enbridge. Stop Line 3” and “Enbridge Profits from Environmental Injustice.”

The protestors, who said they were affiliated with the local activist group Fore River Residents Against the Compressor Station (FRRACS) and standing in solidarity with the Indigenous-led Giniw Collective in Minnesota, accused Enbridge of “committing crimes against humanity” and perpetrating climate change by constructing and operating controversial fossil fuel projects like the Weymouth Compressor and the Line 3 oil pipeline.

Natural gas’s time has passed. The public hates it, governments won’t finance it, and no one is buying.

2. COVID

Nova Scotia announced four new cases of COVID-19 yesterday (Wednesday, June 30).’

Three of the new cases are in Nova Scotia Health’s Central Zone and one is in the Northern Zone; all four new cases are related to travel.

There is an additional “probable” case of COVID connected to Oceanview Education Centre in Glace Bay. The Department of Health & Wellness explains:

Based on public health assessment, this case is being treated as a lab-confirmed positive to ensure all precautions are taken.

Indeterminate test results do not provide a negative or positive. They may occur because someone previously had COVID-19 and the virus is still detectable in their system, or someone has been tested before the virus is fully detectable. In these situations, public health conducts further assessment, including whether someone had or has symptoms or was recently exposed to someone with COVID-19, to inform how the case is treated. Since probable cases are not confirmed to be positive, they are not included in today’s total number of positive cases of COVID-19.

Close contacts with the probable case will be notified, but all staff and students at the school should get tested.

There are now 51 known active cases in the province; two people are in hospital with the disease, neither of whom is in ICU; nine people are considered newly recovered today.

Vaccination data were not provided yesterday.

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3. Raining money

We’ve updated the “It’s raining money in Nova Scotia” map, chronicling the $84,354,000 in new expenditures announced by the Rankin government since June 8. You can zoom in and click on the money bags to get details about each announcement.

My guess is that an election will be called this weekend.

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4. Moot

“A Nova Scotia Supreme Court judge has refused to hear a challenge of an injunction obtained by the provincial government that banned protests and other gatherings during the recent COVID-19 lockdown in the province,” reports the Canadian Press:

During a hearing Wednesday, Justice James Chipman ruled that a challenge of the original court order by the Canadian Civil Liberties Association is now moot because the injunction had been lifted.

“In my view there is no longer a live controversy or adversarial context,” Chipman said.

I’ll leave it for others to argue about Chipman’s decision, but I’ll note that it would have been extremely perverse to hear this challenge after the courts have routinely rejected dozens of challenges from prisoners at the province’s jails for the same reason — conditions had changed, so therefore the challenge was moot.

This is how it works: the jail tosses a prisoner in solitary confinement, which is recognized by the United Nations as torture, or imposes some other intensive form of deprivation, and the prisoner eventually finds paper and pencil to hand-write a habeas corpus application that is delivered to the court — a process that can take as long as a week. Then, once the application is received by the court, a hearing is scheduled; if the application is received on a Friday, the hearing might not be scheduled until the next Tuesday. In the meanwhile, the prisoner continues to live under tortuous conditions, but on, say, the Monday before the Tuesday hearing, the jail moves the prisoner back to the general population unit in the jail. So at Tuesday hearing, the judge says, essentially, “well, you’re not being tortured now, so I don’t have anything to rule on. It’s moot. Application dismissed.” It’s entirely possible that the very same prisoner will be moved back to solitary confinement the next day, so this process can be repeated multiple times.

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5. Fire

An RCMP release from yesterday:

The Indian Brook RCMP is investigating a suspicious fire that occurred on June 30 on the Sipekne’katik First Nation.

At approximately 4:20 a.m., the Indian Brook RCMP were called to a structure fire at a church in Sipekne’katik. Upon arrival, the local fire department and police noted that the fire was localized to the south side of the church. The fire was put out by the local fire department and police began their investigation. No one was injured in the fire.

Investigators have determined the fire to be suspicious in nature and are working with the Nova Scotia Fire Marshal’s Office.

The investigation is ongoing.

This is Saint Kateri Tekakwitha Church.

Kateri Tekakwitha was the first Indigenous person of North America to be named a Catholic Saint, by Pope John Paul II in 1980. She was an Algonquin-Mohawk girl stricken by smallpox who converted to Catholicism at age 19, and lived with the Jesuits until she died at 24.

Stephen Brake took several photos of the damage to the church, and they are posted at kukukwes.com. Writes Maureen Googoo:

The fire at St. Kateri Tekakwitha Parish is the latest of several churches that have been set on fire in Alberta and British Columbia in the past several days as news of more human remains have been discovered at former residential school sites in Saskatchewan and British Columbia.

…

The Sipekne’katik First Nation has also been surveying the grounds of the former Shubenacadie Indian Residential School to see if there are any unmarked graves on the property.

…

Heather Knockwood is the president of the Ladies of St. Anne, one of several church groups associated with St. Kateri Tekakwitha Parish in Indian Brook. She says she noticed people leaving comments online stating they wanted to set fire to the church on Canada Day.

“We knew this was going to happen. It happened a day sooner,” she said.

Knockwood said she understands the pain and hurt First Nations people are going through as more news of human remains being discovered at former residential school sites. However, she said that setting fire to churches isn’t the best way to deal with that pain.

“It’s just a really sad time. I just cried. I’m really hurt and I know our people are hurting,” Knockwood said. “To me, this is not the answer. To burn the church is not the answer with what’s happening with our people today,” she added.

Ku’ku’kwes is an Indigenous-run news outlet covering Atlantic Canada, and Googoo needs all the support she can get. You can support this important work here.

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Government

No meetings

On campus

No events

In the harbour

Halifax
06:00: Algoma Integrity, bulker, sails from Gold Bond for Baltimore
06:00: ZIM Monaco, container ship, arrives at Pier 42 from Valencia, Spain
08:30: Nolhanava, ro-ro cargo, arrives at Fairview Cove from Saint-Pierre
08:30: Maria S. Merian, research/survey vessel, arrives at Irvin Oil from Emden, Germany
13:00: Maria S. Merian sails for sea
16:30: ZIM Monaco sails for New York
18:00: Nolhanava, ro-ro cargo, sails for Saint-Pierre

Cape Breton
08:20: CSL Tacoma, bulker, arrives at anchorage from Wilmington, North Carolina
13:00: SLNC Severn, bulker, sails from Aulds Cove quarry for sea
13:00: CSL Tacoma moves to Aulds Cove quarry

Footnotes

Slow news day.

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