The paper will describe the proposed Arctic Pilot Project, consisting of production, field processing, transmission, liquefaction terminal, shipping, and receiving terminal. Emphasis will be on the unique problems resulting from the Arctic location and the work that has been done to solve these unique problems.
Approximately $11 million has been spent by the participants in defining the Project and the conclusion has been reached that it is feasible to transport gas on a year round basis from the Arctic to an East Coast receiving terminal.
The Arctic Pilot Project proposes to transport 250MMSCFD of gas from Melville Island in the Canadian Arctic to markets in Eastern Canada. To do this the gas will be pipelined from the Drake Point gas field to Bridport Inlet on the South Coast of Melville Island where it will be liquefied and loaded on ice-breaking LNG carriers for transportation to a regasification terminal in Eastern Canada.
The economical and environmentally sound transportation of gas from the Arctic revolves around the answer to two important and basic questions:
Can the Melville Island facilities be built on an economical and environmentally sound basis given that the location could be expected to result in conventional facilities that would cost at least five times that of facilities built in settled areas?
Can large ice-breaking LNG carriers operate all year round in the Arctic waters leading to Bridport Inlet?
Petro-Canada, The Alberta Gas Trunk Line, and Melville Shipping have spent over $11 million and two years in finding the answer to these two questions; and have concluded that the project is feasible, that the capital cost would be about $1.0 billion, and that the gas will be delivered to Southern markets at a competitive price.
These facilities include the gas transmission line across Melville Island, the floating LNG plant and storage, and the Bridport shipping terminal.
The lack of site specific information, which increases uncertainties in scope definition, and the high cost of on-site labour result in Arctic construction costs (using conventional methods) that are at least five times the costs in settled areas; and in a high degree of uncertainty in estimating final costs. The cost of on-site labour for this project will be minimized by building facilities to the greatest extent possible, in settled areas. This approach has the further advantages of minimizing the environmental and socio-economic impact in the Arctic.
The proposed gas transmission line is a 160km, 22-inch buried chilled gas line. This size line has a calculated capacity of 336MMSCFD at the design inlet, and outlet pressures of 1200psig and 900psig.
The cost estimate was prepared by AGTL, assisted by Canuck Engineering. The costs have been based on proven construction techniques such as those used in the permafrost sections of the Aleyeska Pipeline. The estimators have assumed construction only in the months of April, May, September, and October months when there will be daylight and when the ground will be frozen.