Liquefied Natural Gas and Stornoway Project

By Ramnik Riar & Sara Serravalle

It is often forgotten that Hydro-Quebec is not the only source of energy in Quebec. In fact, thirty-eight percent of the province’s energy consumption consists of fuels such as gasoline, diesel and heating oil (QOGA, 2015). Natural gas is of the most energy efficient and cleanest type of fuel. However, due to a large increase in production of LNG within the United States, the price of natural gas within the North American market is too high leaving petroleum products as a more economically reasonable choice. Unfortunately, all the natural resources used to make these petroleum products are imported into Quebec.

As of September 2014, a joint partnership between Gaz Métro with Phillipe Couillard, Premier of Quebec, Pierre Arcand, Minister of Energy and Natural Resources and Minister responsible for the Plan Nord, Jean D’amour along with Minister for Transport and the Implementation of the Maritime Strategy have stated that they will increase natural gas liquefaction at Gaz Métro (Gaz Métro, 2014). Moreover, the Québec government supports this partnership by investing fifty million in the Gaz Metro subsidiary responsible for the marketing of liquefied natural gas.

LNG is getting a lot of attention from potential customers such as Stornoway Diamonds, a leading Canadian diamond exploration and development company. The cost of using the electricity grid is too costly in comparison to the lifespan of the mine. Therefore, Stornoway Diamond has decided to use LNG-powered plants in comparison to the diesel generators. Being the first company in Canada to be supplied with LNG, Matt Mason, CEO of the company has commented the following; “LNG is a promising idea due to the positive long-term supply outlook, which will leave the company with a smaller environmental footprint. Moreover, the company economically benefits from LNG due to the substantial decrease in operating costs.” (Stornoway Diamond Corporation, 2014).

These advantages have led to the creation of The Renard Diamond project, which is located 250 km north of the Cree community of Mistissini. This will be one of the first diamond mines within Canada with all year-round access due to Route 167 extension, part of Québec’s Plan Nord. The distance between potential gas consumers in these communities covered by the Plan Nord and the network has initiated a process that will accelerate the natural gas supply to these Côte Nord and Nord-du-Québec regions.

By the summer of 2016, it is expected that it will be possible to supply regions further from the natural gas regional network with this source of energy (The Plan Nord Action Plan, p.40, 2015). Moreover, the natural gas will be used as a more environmentally friendly fuel source for road and marine transportation. Finally, this project will prove its worthiness by creating approximately 500 jobs along with bringing in 500 millions of dollars in licensing fee to the Quebec government (LaPresse, 2014).

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