There are signs the proposed Goldboro Liquefied Natural Gas plant in Guysborough County is getting ever closer to ramping up. People concerned about climate change say that once in production the facility will make it difficult for Nova Scotia to meet its greenhouse gas reduction targets.
Nova Scotia has granted all the required environmental approvals to two separate LNG export facilities, Goldboro being one of them, with a third application being considered. The Liberal government has approved and supported these projects despite the fact that even one of these facilities will singlehandedly increase Nova Scotia’s 2022 greenhouse house gas emission targets by up to 23 per cent.
Industry analysts have consistently dismissed the economic viability of these East Coast projects. And the failure of one after another well-funded proposed LNG megaproject in British Columbia was widely understood to corroborate this dim assessment.
Despite all this, it appears that the Goldboro LNG plant owner, Pieridae Energy, is getting close to starting construction on the $10-billion project in Guysborough County sometime this spring, with processing and export to begin four years later.
An LNG export facility is an extremely expensive and complex undertaking. The Goldboro LNG plant will be about 50 times larger than the controversial Alton Gas Storage project. And the plant will emit more greenhouse gases than the province’s two pulp mills combined.
Nova Scotians are accustomed to grandiose announcements of megaprojects that do not materialize. But the investment required for an LNG plant, and all of its complex implementation elements, means that once the proponents commit to the final investment decision they tend to not pull back. The scrubbing of LNG projects in B.C. occurred just before each project was due to make such a decision.
Prominent energy analysts simply dismissed the possibility that an independent, like the promoter of Goldboro LNG, could succeed where the global majors have failed. But Pieridae CEO Alfred Sorensen has substantial cash of his own, and has quietly assembled the pieces he needs for the Goldboro project.
Sorensen’s company, Pieridae, a few years back secured a German customer on a 20-year contract, at an LNG volume enough to make the proposed plant viable. By itself, this contract rightly impressed no one. Of course, the Germans will buy the LNG as a hedge against Russia as their dominant supplier.
But along the way, Sorensen has quietly secured a loan guarantee from the German government for construction of the LNG plant. Other investors are still required, but Pieridae became far more attractive with the guaranteed access to credit at prime rates. With that German loan guarantee, the company will also be able to offer credit to its customers, a major advantage over new competitor LNG plants in the U.S.
Where regasified LNG in Germany replaces existing natural gas consumption, there would be very little GHG emission effect in Germany. Where the LNG displaces the burning of coal in power plants, there would be a decrease of GHG emissions in Germany.
Borders and even vast oceans make no difference when it comes to GHG emissions — it all goes up into the one atmosphere our planet has. Over the whole extractionto- burning life cycle, LNG is actually worse than burning coal.
Stephen Thomas, energy campaign co-ordinator for the Ecology Action Centre, is very concerned about the climate impacts of the LNG industry. “The plants have the potential to undo the good work Nova Scotia has done in reducing greenhouse gas emissions and building the green economy here at home,” he says.
“We know that LNG is very emissions-intensive,and we simply don’t know what the exact GHG impacts of these plants will be. Even if the Goldboro plant is built utilizing the
best-case emissions intensity benchmark from Nova Scotia Environment, the project would add more than 2.4 million tonnes of greenhouse gas emissions every year. That would increase the total projected 2022 Nova Scotia GHG emissions by about 18 per cent.”
Thomas added that if all three LNG plants are built, it could add more than 7.5 million tonnes of greenhouse gas emissions, which would increase the 2022 provincial emissions by about 70 per cent.
When the federal government allowed Nova Scotia to bring in a cap-and-trade carbon pricing system instead of a carbon tax, Stephen McNeil’s government chose to give the large emitters of Nova Scotia a free pass for their existing GHG emissions. There is no direct carbon pricing cost for them. Instead, new emitters will have to buy “credits” for their GHG emissions. How that will work will only be revealed in the fall of this year.
If and when the Goldboro LNG plant comes online as the largest GHG emitter in the province, the amount of credits Pieridae would need to buy will utterly swamp the demand for emission credits. The amount the company pays for the credits it needs will be determined by how the province uses its discretion to structure the system.
When considering the glowing promises of what LNG can do for Nova Scotians, keep in mind the permanent employment projected at the plant is estimated to be 175 people.
Jobs for 175 people is not a trivial matter. But for that number of jobs, we would completely wipe out our hard-fought targeted reductions in GHG emissions.
Meanwhile, Nova Scotia doesn’t offer much support to green economy opportunities distributed across the province — providing jobs in small, local businesses that reduce GHG emissions and pay their way with energy cost reductions.
Ken Summers lives in Minasville and is on the steering committee of NOFRAC.