Proposed Mackenzie Valley pipeline spurs Arctic coal gasification mega-plan
17:46:34 EST Mar 20, 2006
BOB WEBER
cbc.ca
(CP) - A proposed Mackenzie Valley natural gas pipeline is still before the regulators and it's already creating massive new plans for industrial development in the Arctic.
Vancouver-based West Hawk Development (TSXV:WHD) has unveiled plans to strip-mine extensive coal reserves along the Mackenzie River and begin building $2 billion worth of coal gasification plants to tie into the pipeline within four years.
"It's a property we're feeling very comfortable with in terms of generating natural gas from coal," West Hawk president Mark Hart said Monday.
Earlier this month, West Hawk announced it had bought about 1,100 square kilometres of leases in three areas of the Northwest Territories estimated to contain 2.1 billion tonnes of coal. Two of those are near Tulita, a tiny Dene community on the Mackenzie just west of Great Bear Lake.
Hart said the coal could be barged to market along the Mackenzie River. But gasification - turning the coal through heat and pressure into synthetic natural gas - is West Hawk's priority.
"We're definitely going to gasify," he said. "It's the kind of coal resource that flows nicely into the pipeline concept."
Hart envisions a series of strip mines taking up to 30 million tonnes of coal a year and feeding it into gasification plants. The plants would be developed in four phases, with each phase worth about $450 million.
That gas would be shipped to southern markets in the pipeline proposed by Imperial Oil (TSX:IMO) and its partners, which is now the subject of public hearings by two regulatory boards.
"We really want to have 20 to 40 per cent of the capacity of the pipeline."
Imperial spokesman Pius Rolheiser said West Hawk has contacted the proponents about reserving space in the pipeline. Rolheiser said Imperial is open to a deal.
"The pipeline is expandable and it's accessible to others," he said.
Hart said West Hawk plans to capture and remove both the pollutants and the greenhouse gases created by the procedure. The byproduct is an inert, glasslike slag, which could be used to make building materials or concrete.
The open-pit strip mines would be subject to ongoing reclamation, he said.
West Hawk has a long way to go, said Drew Williams of the N.W.T. Department of Industry, Tourism and Investment.
"Plans by West Hawk are extremely preliminary but the (territorial government) looks forward to hearing further details from the company."
Hart acknowledges his company is just at the start of the community consultation process. Nor has it filed any regulatory documents - although Hart expects to have something before the Mackenzie Valley Environmental Impact Review Board in about six months.
Still, Hart said West Hawk could be mining coal within two years and turning it into natural gas 20 months after that.
That would be right around the time the pipeline is expected to begin delivering gas.
West Hawk's proposal underlines concerns that the Mackenzie Valley pipeline will unleash a wave of development up and down the western Arctic.
Interveners have already told the panel conducting public hearings that so-called "induced development" should form part of the pipeline's environmental review.
"It's exactly what we were talking about," said Pete Ewins, northern conservation director for the World Wildlife Fund. "It's playing out right in front of our faces."
Pipeline proponents have resisted broadening the scope of the review.
© The Canadian Press, 2006
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This has such a smell of a penny stock promotion. Mining coal in the N.W.T. would be hard enough but getting massive coal gasification equipment in and set up in the remote and near roadless N.W.T. would be soo expensive. Look at the cost overruns on oil sands facilities around Fort McMurry which is much farther to the south and better served by roads and other infrastructure. |
