PNN JUNE 2021

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PIPELINE NEWS NORTH

Serving the Oil and Gas Industry in Northern B.C. and Alberta

June 2021

VOL. 13 • ISSUE 06 • DIST: 17,500

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LNG Canada marks milestone with arrival of core processing units

By Nelson Bennett Three large pieces of equipment weighing nearly 1,000 tonnes have arrived in Kitimat, marking the beginning of the “going vertical” stage for the $17 billion LNG plant being built there. The equipment arrived earlier this week by ship, and will be placed on self-propelled transporters that will move them three kilometres along a special haul road to the site where the liquefaction plant is being built. The equipment includes a 345-tonne, 50-metre long cryogenic heat exchanger, and two precooler units, which weigh roughly 300

tonnes each. The aluminum cryogenic heat exchange unit and precoolers were built in Germany by Linde plc, which is based in Dublin, Ireland. Later this year, a second heat exchanger and two more precoolers are expected to be delivered. Once in place, they will be erected and will form the heart of the processing plant that will chill natural gas to minus 160 degrees Celsius to turn it into a liquid for storage and then transport via specialized LNG carriers. “Taking delivery of our first main cryogenic heat exchanger and precoolers is another significant milestone for the LNG Canada

project, and represents a number of firsts for us,” LNG Canada CEO Peter Zebedee said in a written statement. “It’s our first opportunity to receive critical infrastructure at our new material offloading facility, and our first heavy equipment transport along our new haul road to our main construction site. “Thanks to the thousands of highly-skilled Canadians who are working on our project, we’re making tremendous progress in 2021, and we’ll be reaching more major milestones, safely, in the weeks and months to come.”

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The Pipeline News North, JUNE 17, 2021

Students try hand at engineering during Shell Days By Dillon Giancola Fort St. John students had the chance to think about a future in engineering this week thanks to Shell Days, a School District 60-wide event put on by Shell Canada and DiscoverE. Shell donated 1,275 engineering activity boxes to the school district, with one to two students working with each box. Kits for Grades 1 to 3 focused on robotics, kits for Grades 4 to 6 focused on electrical engineering, and kits for Grades 7 and 8 let students work with biomedical engineering. See next page

Kaiden Kirschner and Walker Thompson enjoyed working on their engineering activity box. GIANCOLA

FORT ST JOHN

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Contact us: Unless otherwise specified all regular meetings are held upstairs at the Fort St. John Curling Rink at 6:00 pm on the second Thursday of the month. Fort St. John Curling Rink 9504 96 St, Fort St John, BC Mailing Address:

Fort St. John Petroleum Association Box 6122, Fort St. John BC V1J 4H6


The Pipeline News North, JUNE 17, 2021

Mrs. Hardy helps Grade 5/6 students Brandon Ross and Hayden Indelicato with their engineering project, while below Connor Dann experiments with a battery during Shell Days at Duncan Cran. GIANCOLA

from previous “We love working with our community partners to bring hands-on learning to kids, to connect activities and engineering to students, and give kids at this age a bit more career exposure and see the potentials of what they can do,” said Brian Campbell, SD60 district principal of careers. DiscoverE is a program from the University of Alberta that inspires and engages youth through fun and meaningful programs in science, technology, engineering, and math (STEM). “They are having so much fun, and it really makes them problem solve on their own, and those are skills they don’t always get to use,” said Jessica Hardy, whose Grade 5/6 class at Duncan Cran Elementary worked to make a creature out of Play-Doh with battery-powered eyes that lit up. It was a real treat for the students, who were able to spend a full day with the boxes. The day consisted of a greeting from a local elder, a presentation from Shell employees about their careers, lessons from DiscoverE, and an afternoon working through the three lessons included in each box. “This has been one of my favourite stem projects I’ve done in my entire school career. It’s fun to be creative and work with electricity, to get to make sparks,” said Duncan Cran student Connor Dann. “This is pretty easy, but it’s great. You get to work with batteries, make stuff like this, and ta-da, magic,” said student Brandon Ross as he showed off the creature he created. “It’s nice to be able to tie in the academic subjects for students and see what career goals they can have,” said Campbell. “The

students like having the opportunity to do hands-on work, find out more about different careers, and I’ve heard nothing but positive feedback.” “We are thrilled to partner with DiscoverE, an organization doing valuable work to encourage diversity in the engineering profession. Our Shell volunteers were happy to spread their love of science, technology, engineering and mathematics (STEM) – subjects at the very heart of our work at Shell. By supporting STEM-related programs, we hope to equip future generations with the skills needed to participate in, and lead, the energy transition,” said a representative of Shell Canada.

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4 The Pipeline News North, JUNE 17, 2021

PNN MISSION STATEMENT Pipeline News North provides current, interesting, and relevant news and information about the oil and gas industry in Northeast B.C. and Northwest Alberta. Have an interesting story to share or a news lead? Email us at editor@ahnfsj.ca.

Federal energy regulator joins oil and gas liaison program Lori Lineham, an oil and gas liaison for Doig River First Nation. Lineham attends weekly inspections with BCOGC inspection staff.

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The Canada Energy Regulator says it is joining an aboriginal liaison program in B.C. meant to improve the relationship between regulators, government, and northern First Nations. The program began in 2014 as a partnership between the Doig River First Nation and the BC Oil and Gas Commission. Today it includes 10 provincial government agencies and 15 First Nations in northern B.C. that are supported by the BC Oil and Gas Research and Innovation Society. The CER says joining the program and collaborating with First Nation communities will help ensure federally regulated pipelines are safe, that the environment is protected, and that aboriginal rights are recognized and respected. “Being part of this well-established program in Northern B.C. will further our awareness and understanding of the traditional and cultural worldviews of these communities by honouring their expertise in traditional land use, sacred

sites, and historical knowledge,” said CEO Gitane De Silva in a release. There are 12 liaison positions, hired and employed by First Nations communities, who share local knowledge with natural resource agencies and regulators, including the BCOGC and CER. Lori Lineham, a member of the Doig River and a liaison since 2015, says the work has helped develop. her understanding of development and its impacts while being able to inform her community with reliable information. “I love working with agency staff to help them understand First Nation’s values and traditional ecological knowledge, and to learn firsthand about my culture and community,” said Lineham. “Building relationships between First Nations and all Government agencies is important, and I am looking forward to working with the CER and their staff to learn and share knowledge and experiences.”


METAL ROOFING & SIDING The Pipeline News North, JUNE 17, 2021

Field research station looks at impacts to groundwater

METAL ROOFING & SIDING NOW DOING RE-ROOFS AND NEW INSTALLS NOW DOING RE-ROOFS AND NEW INSTALLS

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Researchers based out of the Peace region have gained valuable insights into the movement and measurement of natural gas in the shallow subsurface, as well as assessments of impacts to groundwater, using a custombuilt field station in the area. The Assessment of Fugitive Natural Gas on Near-Surface Groundwater Quality project report published by Geoscience BC examines the physical and biogeochemical processes that impact gas migration and the results provide baseline research needed to support the continuous improvement of BC’s natural gas sector. University of British Columbia groundwater researcher Bethany Ladd and project lead, Prof. Roger Beckie, said: “Research like this is valued by industry, governments, communities and Indigenous groups alike. It provides additional knowledge to support decision making about the environment and development.” Water quality, water quantity and fugitive emissions are three of the four key areas of focus in the provincial government’s 2019 Scientific Review of Hydraulic Fracturing in British Columbia. Recommendations in the report include additional research relating to understanding fugitive emissions, with a focus on field-scale research experiments. The multi-disciplinary research took place at the

Hudson’s Hope Field Research Station 20 kilometres north of Hudson’s Hope in BC’s Northeast Region. In mid-2018, 97.5 cubic metres of a gas mixture mimicking Montney natural gas was released under controlled conditions into the subsurface. Various monitoring methods traced its movement and quantified its environmental effects. By measuring attributes before, during and for two years after the gas was injected, the researchers found that the majority of the gas remained in the subsurface. Some of the remaining gas migrated to the surface along natural and humancaused pathways, but most was trapped by impermeable layers and dissolved into groundwater. The current findings suggest that gas migration in the early time after release of natural gas did not lead to degradation of groundwater quality. Based on data from the first two years, the impact on groundwater geochemistry included no significant changes in major or trace elements. Geoscience BC Executive Vice President & Chief Scientific Officer Carlos Salas said the project provided research to guide informed management of natural gas and water resources. Research like this is essential to fully understand effects and potential effects of resource development. See next page

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6 The Pipeline News North, JUNE 17, 2021

Oilmen’s golf plans up in the air THANK YOU FOR RECYCLING THIS NEWSPAPER.

There will be no Oilmen’s Golf Tournament in June for the second straight year. After cancelling the 2020 tournament, the Fort St. John Petroleum Association hoped to hold this year’s tournament June 5 to 8. However, with the current public health restrictions in place, golf tournaments aren’t allowed to take place. “We’re hoping to maybe have one in the fall or as soon as it opens up. Hopefully we’re at least in the clear for next year,” said Dan Bonin, chairman of the Oilmen’s Golf Tournament.

The next Oilmen’s Golf Tournament will be the 58th edition of the longtime event. 2022 would have been in line for the tournament’s 60th anniversary. However, that special celebration keeps getting pushed further away. Currently, there are no solid plans to host Oilmen’s events this year, though the association is hopeful the trapshoot can go ahead. The 2020 Oilmen’s Trapshoot was the lone Oilmen’s event to take place during the pandemic. See next page

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Cooks serving food to oil workers, Rainbow Lake area, Alberta, circa April 24, 1967. GLENBOW MUSEUM ARCHIVES


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Tamaska LNG plant in Fort Nelson now in operation

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Matt Preprost Cryopeak LNG says its new plant in Fort Nelson is now operational. The Tamaska LNG plant is the most northern LNG production facility in Canada, the company said, with a first phase production capacity of 27,000 gallons per day. “We are excited to open this new production facility in Fort Nelson,” said Cryopeak CEO Calum McClure. “We appreciate the support in realizing this project from the Fort Nelson First Nations and the community of Fort Nelson. We look forward to delivering natural gas to our remote customers lowering energy costs and reducing carbon emissions.” The facility is key to the energy supply to Northern Canada, allowing off-grid communities and remote industries to secure a lower cost and a more environmentally sustainable fuel source. Last summer, the company completed the largestever delivery of LNG by truck in the Northwest Territories,

with 18,000 gallons delivered to a power generation facility in Inuvik. “We are thrilled to now have an LNG production facility available to us in the far north of the Province,” said Rick Loughery of Coeur Silvertip Holdings Ltd., the owner of the Silvertip Mine. “Cryopeak has been a reliable supplier of LNG to the Silvertip Mine for several years now, and this new facility will allow it to deliver LNG from a location that is much closer to our site, which will result in considerable savings in transportation costs, even greater certainty of supply and reduced GHG emissions from trucking.” Ground broke on the construction of the facility last spring. The plant is scalable to 100,000 gallons per day under its current permit, the company said. “Tamaska is a perfect fit for the north, establishing Fort Nelson as a transportation hub and reducing the carbon footprint of remote communities,” said Northern Rockies Mayor Gary Foster.

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8 The Pipeline News North, JUNE 17, 2021

Trans Mountain expansion in peak construction

Nelson Bennett The expansion of the Trans

Mountain pipeline was 25% complete in the first quarter of this year, but more than half of

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the estimated capital cost of the expansion has been spent, according to Trans Mountain’s first quarter financials. “As of March 31, 2021, construction is approximately 25% complete, with $7.1 billion in capital spending incurred since the inception of the project,” Trans Mountain Corporation says in its first quarter management report. The total cost of the pipeline twinning project was last estimated at $12.6 billion, so more than half of the estimated capital budget has been spent to date to get the project one-quarter of the way built. In 2017, the project was estimated to cost $7.4 billion. It was revised to $12.6 billion in 2020, after the federal government bought the existing pipeline from Kinder Morgan and assumed responsibility for completing the twinning project, which had been troubled by endless legal, political and regulatory delays. Spending to date has been on “upfront costs of permitting, regulatory processes, legal, materials such as pipe, valves, buildings, motors, and financing costs in addition to direct construction related activities,” the company says in its first quarter report. The company spent $997 million in the first quarter of this year on the expansion project, which

is now in its peak construction phase. “Trans Mountain expects that 2021 will see peak construction for the TMEP, with thousands of people working at hundreds of sites across Alberta and British Columbia,” the management report states. “Trans Mountain anticipates mechanical completion of the project by the end of 2022, with commercial operations commencing shortly thereafter.” Work has begun on tunnel boring through Burnaby Mountain, as well as tank pad construction at its Burnaby terminal. The expansion will increase the pipeline’s capacity from the current 300,000 barrels per day (bpd) to 890,000 bpd. As for revenue from the current pipeline operations, Trans Mountain reported revenues of $107 million and earnings before interest, taxes, depreciation and amortization (EBITDA) of $44 million in the first quarter of 2021, compared with $103 million in revenue and $47 million EBITDA in Q1 2020. The volume of oil moved through the main line and through the Puget Sound pipeline to Washington State was also up, compared to the first quarter of 2020, though exports of oil through Westridge Marine Terminal were down slightly. t page


The Pipeline News North, JUNE 17, 2021

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10 The Pipeline News North, JUNE 17, 2021

Pay it forward campaign benefits local causes Resolve General Manager Craig Brooks holds a hat full of community organizations as Owner Joffre Jorgensen pulls the winning name. The Prespatou 4H Club was May’s recipient of the Pay It Forward initiative. SUMMER

Tom Summer Fort St. John community groups are benefiting by the thousands from a new pay it forward campaign from one local energy company. Resolve Energy Solutions has been drawing organizations from a hat once a month this year, donating $1,500 to local causes, charities, and non-profits. The Prespatou 4H Club was the winning club drawn for May, and since January, the Salvation Army food bank, North Peace Pregnancy Care Centre, Fort St John Hospital Foundation, and North Peace SPCA have all

benefited. Resolve owner Joffre Jorgenson says the Pay It Forward initiative was sparked after his company was on the receiving end of a such campaign among local businesses, and won a free one-year lease on a new pickup truck. Jorgenson said the company decided the best thing they could do is help community organizations in need, building social value for residents. “We were very grateful to be recipient of that award and we thought it be a great opportunity to pay that gift forward and give back to our community,” said Jorgensen. “All

communities are in need right now, we’re grateful to be working and keeping busy enough to be able to do that.” Jorgenson would like to keep the program going in future years, with large list of groups the company is keen to help. He said the idea came along at the right time. “The response from the community, the appreciation, we’re very grateful and appreciative that we’re able to give back to the community,” he said. “It’s one of those fill your cup type of initiatives. The lights are on and we’re thriving as a business, so why not give back?”ee next page

Oil and Gas Commission update for PRRD Tom Summer

CEO and Commissioner Paul Jeakins gave an update on the B.C. Oil and Gas Commission’s undertakings to the Peace River Regional District, appearing as a delegation at their June 11 board meeting. Jeakins says the Peace region has remained prosperous despite the COVID-19 pandemic. “Production started fairly slowly but increased steadily, and now it’s at or above last year’s levels. There has been a switch from liquids to dry gas,” said Jeakins. “There was a lot going on. It was surprising for us in terms of what we anticipated through the pandemic. But certainly we’ve seen that the numbers have stayed pretty high.” 370 wells were drilled last year in the Montney Basin. 580 applications for wells are

expected this year. “With the improvements in technology, there’s fewer wells needed then we would have expected even a couple of years ago. Plus, Montney is a world class natural gas basin. So that’s a really good thing for B.C.” said Jeakins, noting up to 30 wells could be placed on each individual pad. Area B Director Karen Goodings expressed concern about the location of work camps and emergency planning. “The regional district are basically the people who have to do the emergency planning and so it’s very difficult to do emergency planning when you don’t know what’s where,” said Goodings. Jeakins also noted in his presentation that Coastal Gaslink is scheduled to come online by 2025.

“There’s lots of activity going on, as you can imagine for the Coastal Gaslink Pipeline and the LNG Canada Project. Both those appear to be on time for their stated first delivery, which is going to be later 2024, early 2025,” said Jeakins. He added that ripple effects can be expected for the upstream work related to the project. Dawson Creek Mayor Dale Bumstead said he’s looking forward to the economic benefits of Coastal Gaslink. “Coastal is just one more focus on the Montney region that will certainly drive additional activity in the next year or two as companies start to ramp up to provide another 25 percent of the production that they have. It’s certainly very positive for the industry,” he said.


The Pipeline News North, JUNE 17, 2021

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Pembina Pipeline partners with Haisla on Cedar LNG benefits local causes Nelson Bennett Pembina Pipeline Corp. appears to be going all-in on indigenous owned major energy projects, including the Trans Mountain Pipeline project and an LNG terminal in Kitimat being developed by the Haisla First Nation. Pembina announced June 8 it has entered a partnership agreement with the Haisla on its Cedar LNG proposal, a small floating LNG terminal that would be built on Haisla land. And though it has made no formal announcement on TMX, the company is reported to be also considering a partnership with an indigenous consortium that wants to buy the Trans Mountain pipeline project. The company announced it has formally entered a partnership agreement with the Haisla to develop Cedar LNG.

“Pembina’s long history of safe, reliable operations, and engagement with local communities made them the distinct choice for Cedar LNG,” Haisla Chief Crystal Smith said in a news release. “With a strong partnership, Cedar LNG will bring tremendous economic opportunities and benefits ensuring the Haisla people have control of our own future.” “Cedar LNG will be the largest First Nationowned infrastructure project in Canada and will have one of the cleanest environmental profiles in the world,” Pembina CEO Mick Dilger said. The announcement is good news for Kitimat and the Haisla, which recently saw another major LNG project that had been proposed there evaportate, when Chevron and its partner, Woodside Energy, announced they were abandoning the Kitimat LNG project. The Haisla have an agreement -- negotiated

when the Canada LNG project was proposed -- to source natural gas from the Coastal GasLink pipeline to supply Cedar LNG. The Cedar LNG project has an estimated capital cost of $3 billion. A final investment decision is not expected until 2023, according to Pembina. Pembina makes no mention in its press releases of the Trans Mountain acquisition plan, but the Globe and Mail reports that Pembina has confirmed it plans to partner with the Western Indigenous Pipeline Group (WIPG), which wants to buy the Trans Mountain pipeline, presumably after the $12.6 billion twinning project is complete. It is one of two indigenous groups that have said they want to buy the Trans Mountain pipeline. The other is Project Reconciliation.” See next page

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12 The Pipeline News North, JUNE 17, 2021

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