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LNG to supply natural gas to five North Shore towns
MARATHON, ONTARIO--(Marketwired - Feb 25, 2016) - Northern Ontario communities commend the Liberal government's leadership by including the Natural Gas Access Loan Program in the 2016 Budget.
Today, natural gas is available to nearly every urban Ontario resident, however less than 20% of rural and Northern homes and businesses have access. The provincial government's action today with respect to the loan program goes a long way to helping build prosperity in those communities currently without natural gas by significantly lowering energy costs. The new program will also help to achieve Ontario's ambitious climate change goals by displacing more carbon-intensive fuels.
"The average residential customer is expected to save $1,000 to $3,000 annually which is particularly helpful in a region where incomes fall significantly lower than elsewhere in Ontario," said Terrace Bay Mayor Jody Davis. "Furthermore, natural gas can cut operating costs and reduce emissions for large industry players in Northern Ontario, improving competitiveness and economic viability."
Last year, the communities of Schreiber, Terrace Bay, Marathon, Manitouwadge, and Wawa along the North Shore of Lake Superior signed franchise agreements with Northeast Midstream LP, a Toronto-based infrastructure partnership. The project will use liquefied natural gas (LNG) to extend gas service to approximately 11,000 Northern residents and businesses.
LNG is natural gas in a liquid state. When cooled to minus 162 degrees Celsius, natural gas condenses into a fluid that is 1/600th of its original gaseous volume. LNG is safe and easy to store in insulated containers similar to everyday thermos bottles. Because LNG has a very high energy density, it can be transported long distances and still be economical to use as fuel.
Historically, it has been too difficult to expand gas distribution to North Shore communities. As a result, residents and businesses are limited to propane, fuel oil, wood and electricity for heating, all of which are expensive and can be unreliable. By utilizing LNG and safely distributing it, the cost of heating homes and fueling businesses can be reduced dramatically.
Today more than 100 gas distribution systems in North America successfully use LNG where pipeline delivery is unavailable. Both Quebec and British Columbia are investing in LNG to transport gas to remote areas and reduce emissions.
For North Shore residents and businesses, the expected return of converting to natural gas is between one to four years. Bringing LNG to Northern Ontario is also expected to open up new opportunities and support the use of low-carbon fuels for industry, trucking and shipping.
"The high cost of traditional infrastructure means that Northern Ontario communities rely on Provincial funding support to promote and develop innovative solutions," said Joshua Samuel, president of the general partner of Northeast Midstream LP. "Natural gas via LNG will provide Northern Ontario residents and businesses with a more cost-effective, reliable and cleaner source of energy."
While the loan program is a significant step towards the objective of expanding gas service to rural and Northern communities, additional support through the Natural Gas Economic Development Grant Program is critical to ensure ultimate success.
The North Shore communities and Northeast Midstream look forward to working with the Ministry of Economic Development, Employment and Infrastructure on implementing the Natural Gas Access Loan Program and next steps on defining the Natural Gas Economic Development Grant Program to meet the urgent need for more cost-effective and environmentally friendly energy.
About the North Shore communities
Schreiber, Terrace Bay, Marathon, Manitouwadge, and Wawa are communities along the Highway 17 corridor between Thunder Bay and Sault Ste. Marie, which do not currently have access to natural gas. North Shore residents and business pay up to four times more than others in Ontario for space and water heating. Access to another more affordable and reliable source of energy will provide significant socio-economic benefits to the region. In addition, the expansion of natural gas service is consistent with objectives of the Growth Plan for Northern Ontario, including facilitating strategic infrastructure investments, regional partnerships, community planning and environmental leadership.
About Northeast Midstream LP
Northeast Midstream LP is a Toronto-based energy partnership. It has designed and permitted a 33,000 GJ per day natural gas liquefaction facility in Thorold, Ontario, and has is a developing a similar facility in Northwestern Ontario. Northeast Midstream is focused on expanding natural gas service to communities and industries not currently served, or proposed to be served, by the traditional pipeline delivery model.
Town of Marathon
+1 (807) 229-1340, 2222
Municipality of Wawa
+1 (705) 856-2244, 223
Northeast Midstream LP
President and CEO of the General Partner
+1 (416) 848-1165