The outlook for natural gas in the Atlantic region is strong thanks to a stable market, secure supply and a relatively new pipeline system with lots of capacity, industry executives say.
That’s a contrast to just a couple of years ago, when there were concerns about exploration, production and supply.
“In terms of gas supply, there was a lot of anxiety in the market two years ago when Sable offshore gas from Nova Scotia was about to cease production; the Encana Deep Panuke project had also ceased production, and the potential for shale gas development, particularly in New Brunswick, really did not get off the ground,” says Mike Whalen, general manager, Maritimes & Northeast Pipeline.
“That anxiety in the market was attributable to people wondering whether we would have adequate gas supply to serve the local market. But what has happened over the past couple of years, since Nova Scotia offshore production ceased, is we have really seen an offsetting increase in flow rates predominantly down the Portland Natural Gas transmission system that interconnects with the U.S. portion of Maritimes in Maine.”
Whalen says New Brunswick and Nova Scotia have a “tremendous asset,” thanks to the relatively new and state-of-the-art pipeline-transmission system with its excess capacity.
“Compared to some parts of the electrical transmission grid, which have a lot of constraints, there’s no question that if you have an existing pipeline in the ground right now, it is very valuable because it can be challenging to build new pipelines and facilities,” he says.
Over the last 20-plus years, the market for natural gas has grown domestically, both for residential and industrial customers including power plants, refineries and mills.
Rob Belliveau is the general manager of Emera New Brunswick, which owns the Brunswick Pipeline. He says natural gas remains a strong source of energy while other solutions are put into place.
“While we all believe that we have to reduce our use of fossil fuels, natural gas is a natural transition fuel we can rely on until other technologies are more affordable and reliable than they are today,” Belliveau says. “When you are working in regulated utility markets like we are, it is important to strike a balance to ensure energy remains affordable for customers while we all make the necessary transition to decarbonized electricity supply.”
He said that, given the prevalence of long-term contracts for natural gas in the region, it’s unlikely customers will walk away from natural gas anytime soon.
“It would be difficult to walk away from those kinds of commitments until there’s a lower-cost solution, but that’s not in place right now. Most of the current users believe that natural gas is a key part of the energy landscape for at least the next 15 to 20 years.”