Spectra Energy Corp Announces Project Development Agreement with BG Group for New Natural Gas Transportation System in British Columbia Project to Connect Northeast B.C. Gas-Rich Basins to Potential LNG Export Facility in Prince Rupert
VANCOUVER, British Columbia, Sept. 10, 2012 /PRNewswire/ -- Spectra Energy Corp (NYSE: SE) today announced that the company has signed a Project Development Agreement with BG Group plc (LSE: BG.L) to jointly develop plans for a new natural gas transportation system from northeast B.C. to serve BG Group's potential liquefied natural gas (LNG) export facility in Prince Rupert, on the province's northwest coast. Spectra Energy and BG Group will each initially own a 50 percent interest in the proposed transportation project. Spectra Energy will be responsible for construction and operation and BG Group has agreed to contract for all of the proposed capacity.
The approximately 850-kilometre (525 mile), large diameter natural gas transportation system will begin in northeast B.C. and end at BG Group's potential LNG export facility in Prince Rupert. The new transportation system will be capable of transporting up to 4.2 billion cubic feet per day of natural gas. The project also will connect with the Spectra Energy system at Station 2 (southwest of Fort St. John), a growing natural gas hub that collects supply from multiple areas of the province and other supply basins in Western Canada.
"We are excited to be partnering with BG Group, a recognized world leader in natural gas and more specifically, LNG," said Greg Ebel, president and chief executive officer, Spectra Energy. "This project offers B.C. a unique opportunity to access new markets, strengthen its energy infrastructure, engage stakeholders in economic growth and job creation, and ultimately secure the province's position as a competitive energy leader."
"Furthermore, today's announcement initiates our next wave of investment opportunity in B.C. We are ideally positioned to create further value for our investors by leveraging surplus B.C. natural gas supplies and facilitating its export to high-demand markets in Asia. This, in turn, will provide multiple opportunities for further investment in our gathering and processing facilities in the province," added Ebel.
"For more than half a century, Spectra Energy has been a part of communities in B.C.," said Doug Bloom, president, Spectra Energy Transmission West. "This project will build on our expertise and track record of delivering natural gas responsibly, listening to the needs of Aboriginal and local communities, and protecting the environment, as we help deliver on B.C.'s energy potential."
Working together with affected stakeholders and based on preliminary assessments of environmental, historical, cultural and constructability factors, early conceptual routes have been developed. Spectra Energy and BG Group will continue engaging with interested and affected stakeholders, including Aboriginal and local communities, environmental organizations and regulatory agencies, to further refine the project route.
In addition, the companies will spend the next several years closely conferring with stakeholders and working through the permitting process for the proposed transportation system. This work will include filing a project application with the B.C. Environmental Assessment Office. Based on the results of these efforts, project construction is currently expected to commence mid-decade, with service starting by the end of the decade.
As part of this commitment to transparently communicate and foster relationships in the province, Spectra Energy also announced "Energy for BC" (www.energyforbc.ca). The new outreach initiative is designed to engage with stakeholders on the jobs, revenues and environmental benefits that natural gas can create in British Columbia.
Spectra Energy has operated in B.C. for more than half a century. The company's natural gas transportation system in B.C. moves about 2.4 billion cubic feet of natural gas every day, employs more than 850 men and women in B.C., pays nearly $65 million in property taxes and contributes about $1 million annually in community investments across the province. The company is nearing completion of a $1.5 billion B.C. expansion program, which created more than 1,350 construction jobs and resulted in $120 million in contracts with Aboriginal and local contractors in the province.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of North America's premier natural gas infrastructure companies serving three key links in the natural gas value chain: gathering and processing, transmission and storage, and distribution. For more than a century, Spectra Energy and its predecessor companies have developed critically important pipelines and related infrastructure connecting natural gas supply sources to premium markets. Based in Houston, Texas, the company's operations in the United States and Canada include more than 19,000 miles of transmission pipeline, approximately 305 billion cubic feet of storage, as well as natural gas gathering and processing, natural gas liquids and local distribution operations. The company also has a 50 percent ownership in DCP Midstream, one of the largest natural gas gatherers and processors in the United States. Spectra Energy is a member of the Dow Jones Sustainability World and North America Indexes and the U.S. S&P 500 Carbon Disclosure Project's Carbon Disclosure Leadership Index. For more information, visit: www.spectraenergy.com.
BG Group plc (LSE: BG.L) is a world leader in natural gas, with a strategy focused on connecting competitively priced resources to specific, high-value markets. Active in more than 20 countries on five continents, BG Group has a broad portfolio of exploration and production, liquefied natural gas (LNG) and transmission and distribution business interests. It combines a deep understanding of gas markets with a proven track record in finding and commercialising reserves. For further information visit: www.bg-group.com.
SOURCE Spectra Energy Corp