Petrolia's Bourque gas to be distributed by TUGLIQ
Petrolia's Bourque gas to be distributed by TUGLIQ
2014-11-19 10:34 ET - News Release
Mr. Alexandre Gagnon reports
TUGLIQ ENERGY AND PETROLIA JOIN FORCE FOR NORTH SHORE ECONOMIC DEVELOPMENT
Sharing the Quebec North Shore's ambition to ensure its industrial development with a safe and effective supply of liquid natural gas (LNG), Petrolia Inc. and TUGLIQ Energy have signed an exclusive partnership that could become the major LNG supply chain for the North Shore. Insofar as it gains the requisite government approvals, TUGLIQ Energy has committed to distribute the gas produced by Petrolia from its Bourque permits in Gaspe. The gas will be delivered to the North Shore by a seaway network.
The 15-year agreement gives Petrolia the potential to develop the Bourque project in Gaspe. Located midway between Murdochville and Grande-Vallee, the project has the support of the local authorities in Gaspe. The next stage in developing the Bourque project involves production tests and the drilling of a third well. Tugliq will participate in the financing of this future work.
Tugliq proposes to use a liquefaction barge moored in Gaspe. The unit will supply small-sized transport barges with just-in-time delivery to the consumer to minimize the need for storage on land. Ultimately, this agreement will provide TUGLIQ with the raw material it needs to supply its industrial clients on the North Shore and in Northern Quebec.
"Thanks to our co-ordinated efforts with an impressive array of partners, the North Shore is closer than ever to achieving its goal of obtaining a natural gas supply that delivers it from its dependency on diesel fuel. For the industrial clients on the North Shore and those wishing to join the Plan Nord's development, this partnership between TUGLIQ and Petrolia represents an extraordinary opportunity," said TUGLIQ executive vice-president Laurent Abbatiello.
"We know that there is work ahead, but thanks to the contribution of all parties and by following a strict timeline we are well positioned to implement this agreement. I am elated to see Gaspe's hydrocarbons contribute to the North Shore's mining development, and vice-versa. An energy link between the south and north of the Saint Lawrence will drive Gaspe's economic diversification while providing a stable, safe supply to the North Shore industries at predictable prices," added Petrolia president and chief executive officer Alexandre Gagnon.
The price of gas produced by Petrolia will be determined using a formula that will ensure a fair return for Petrolia. The development of the gas from the Bourque play will also enable Petrolia to produce petroleum and condensates. The partnership is subject to the negotiation of formal agreements which are in turn subject to approval by the companies' respective boards of directors.
Currently, 100 per cent of the natural gas consumed in Quebec comes from outside the province. That is $1-billion lost to Quebec and which is directed elsewhere. As with electricity rates, a supply of gas at a stable set price over long periods, in particular through the development of the Bourque project, would be an unprecedented catalyst for Quebec's industrial development. The environment will also benefit from the substitution of oil, diesel, coke and other fuels with natural gas, which will help the governments reach their greenhouse gas (GHG) emissions targets.
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