Why Nova Scotia Fossil Fuel Megaprojects Are Going Too Bankrupt

Several of Nova Scotia’s energy mega-projects have failed in the past few months and years, and some say society’s shift towards renewable energy is the reason.

AltaGas, the company with plans to store up to 10 billion cubic feet of natural gas in underground caverns along the Shubenacadie River, announced in October it pulled the plug on the project due to the “repositioning of the business and the challenging nature of the storage project economics”.

In July, Pieridae Energy announced that it would not pursue its proposal to build a liquefied natural gas processing and export facility in Goldboro, Guysborough County. citing cost pressure and time pressure.

The future of the Bear Head LNG project, a proposal to bring natural gas from Western Canada or the US to Port Hawkesbury and then import it to Europe, is uncertain after the company behind the project tried to sell it last year.

The province’s offshore oil and gas future looks anything but rosy a tender for exploration offers earlier this year earned no interest.

Encana Corp.’s Deep Panuke Project is drilling for natural gas off the coast of Nova Scotia in this file photo. The province’s offshore oil and gas industry has declined in recent years. (SBM-Offshore)

Last year, the Donkin coal mine – which produced both steam coal for power generation and metallurgical coal for steel production – permanently closed, with the company blaming the geological conditions in the underground mine.

Moving away from fossil fuels

Jennifer Tuck, CEO of the Maritime Energy Association, said the industry’s transition away from fossil fuels is having an impact on Nova Scotia’s energy landscape.

“The focus on climate change, meeting global emissions reduction targets, all of these things make it a challenge in the fossil fuel sector in my opinion,” she said.

Tuck said mutual funds had pulled out of financing oil and gas projects and the federal policy changes were more focused on clean energies and technologies.

The Donkin coal mine in Cape Breton was finally closed in 2020. (Radio Canada)

Pieridae Energy had requested nearly $ 1 billion from the federal government to support their plan to deliver liquefied natural gas to Europe, but funding remained unresolved.

Community and global opposition to fossil fuels also likely played a role in the demise of some of Nova Scotia’s energy mega-projects, said Noreen Mabiza, energy coordinator at the Ecology Action Center in Halifax.

“It’s definitely a factor that shouldn’t be ignored,” said Mabiza. “People have been there for years and say that they don’t want projects like this.”

AltaGas, the company behind the proposed natural gas storage project along the Shubenacadie River, pulled the plug in October. (AltaGas Ltd.)

When AltaGas announced it was abandoning its natural gas storage plan, it said the project had “experienced mixed support, challenges and delays”. Mi’kmaw protesters and other opponents have long spoken out against the project, set up camp on the river and started legal battles.

“It takes years. It wasn’t overnight to bring these projects down, but it’s just the ongoing struggle of people who fight and want to protect our country and people who realize that we are in a climate emergency and are just sure. ” Things are not going to happen anymore, “said Mabiza.

“Constant wishful thinking”

Larry Hughes, who teaches energy systems analysis at Dalhousie University and is a founding member of the MacEachen Institute for Public Policy and Governance, said various factors – including finances, logistical hurdles and resistance – are driving the demise of various energy projects in. involved Nova Scotia, but what was consistent was the hype behind each.

Hughes said Nova Scotia has a “colonial mentality” when it comes to energy projects, and is primarily thinking about exporting resources like gas or coal to other areas rather than using them at home first.

“These projects are so highly acclaimed by the province that we are on the way to wealth, we are becoming a province, no more compensation payments. … There is constant wishful thinking.”

Hughes believes the province is at the beginning of a switch to renewable energy.

“Unless BP went out and found a megafield that no one knew was out there and we became Houston of the North, but if that doesn’t happen then there’s nothing really on the nonrenewable side up the cards that I can see. ” he said.

What’s next?

In October, the Nova Scotia government tabled a bill that would phase out coal-based electricity generation and allow 80 percent of the province’s electricity to come from renewable sources by 2030.

Nova Scotia Power President Peter Gregg said the utility expects to meet the 80 percent target primarily through two renewable mega-projects, the Maritime Link and the Atlantic Loop.

Nova Scotia started drawing electricity from the Muskrat Falls hydroelectric power station in Labrador a year ago via the submarine cable Maritime Link. The Muskrat Falls project has been struggling but is expected to meet up to 60 percent of Nova Scotia’s electricity needs by the first half of 2022, Gregg said.

In the Atlantic Loop project, hydropower from Quebec and Labrador would flow through modernized transmission networks to Nova Scotia and New Brunswick. Gregg declined to estimate how long it could take to get the Atlantic Loop up and running, or how much of Nova Scotia’s power would come from the project once it was completed.

A close-up view of the Maritime Link cable connecting Nova Scotia to the Muskrat Falls hydropower plant in Newfoundland and Labrador. Once the project overcomes the current challenges, it would significantly increase the amount of renewable energy flowing into Nova Scotia’s power grid. (Nic Meloney / CBC)

He said talks are ongoing between the relevant provincial governments, provincial utilities and the federal government.

“There are a lot of moving parts, a lot of people involved in the discussions. And I think it starts with everyone agreeing to the plan and then making a commitment to implement it. “

Gregg said he was confident that Nova Scotia Power can achieve the goal in other ways, even if the Atlantic Loop fails to materialize by 2030. scale batteries to store wind energy.

In 2020, according to Gregg, 48 percent of the utility’s electricity came from coal, around 29 percent from renewable sources, 17 percent from natural gas and six percent from imports.

About Christine Geisler

Check Also

GM is open to further agreements with suppliers to ensure production of electric vehicles

With inflation and rising commodity prices, General Motors is planning strategic partnerships with suppliers to …