Oz Woodside Hopes to Replicate Kitimat LNG Electrification

Australian Woodside Energy, one of two partners in the planned Kitimat LNG project on BC’s north coast, hopes to replicate elsewhere its recent decision, in partnership with Chevron Canada, to fully electrify the 18mn mt/yr liquefaction facility.

Speaking with reporters on the sidelines of Gastech 2019 in Houston on September 17, Woodside CEO Peter Coleman pointed to his company’s efforts to generate carbon offsets and develop carbon capture and storage (CCS) projects.

“We know we are leading in generating offsets and developing CCS projects, but we know we need to do more, and that area is probably going to be getting more and more electrification into the liquefaction process, and we can do that using renewables,” he said.

With Australia’s abundant sunshine resource, solar electrification would be a natural fit there, but in Canada, BC Hydro’s growing hydroelectric capacity is where Woodside is looking for the 600 MW of electric energy Kitimat LNG will need.

“If you think about a large LNG plant today, if it needs 500 MW of total power, 100 MW of that may be generated through electricity, 400 MW of that will actually come from gas-fired turbines driving the compressors,” Coleman said. “If those turbines can be converted to electric in a sensible way, that is the best way to start reducing emissions.”

Woodside has been working with turbine manufacturers to convert those units to run on electricity, rather than on natural gas, and it has managed to incorporate the concept into Kitimat LNG, which recently announced an expansion to three trains and 18mn mt/yr from the initial plan for two trains and 12mn mt/yr. Chevron is seeking an expanded natural gas export licence to match the bigger project.

“We’ve been working with BC Hydro on a concept to get power into the site, and that will make it the first fully-electric site for an LNG plant in the world,” he said.

On other matters related to the Kitimat project, Coleman said Woodside has recently decided to disaggregate the project, meaning that it will focus first on establishing the ownership structure of the liquefaction plant, and then turn to whether it wants to also own the pipeline that will deliver feed gas to Bish Cove, the location on Douglas Channel where the plant will be built.

Woodside has always said it doesn’t want to take FID on a project in which it holds a 50% equity interest, so it’s looking now for potential purchasers for a portion of that equity, perhaps 10% or 20%. Chevron Canada would have to approve any equity change.

Further upstream, neither Woodside nor Chevron have made any decisions on who might own the pipeline - with the working name of Pacific Trail Pipeline - and is still discussing that structure. And in the production fields of northeastern BC, where both Chevron and Woodside have reserves in the Liard Basin straddling BC’s northern border with the Yukon and Northwest Territories, no decisions have been taken on how Kitimat LNG will be supplied.

“In BC, the key is the ownership of the plant; the upstream is not an issue because there is so much gas available,” Coleman said. “It’s about ownership of the plant; we’re working with people about who is best to own the pipeline and how that would work; the final step then would be working on the upstream supply, whether that supply comes from the Liard basin, from other producers in western Canada, or a combination thereof.”