Armed with a laser pointer and a map of the Lower Churchill transmission route, Nalcor Energy president and CEO Ed Martin walked business people through the details of the $6.2-billion hydro agreement Wednesday.
The word opportunity was liberally sprinkled throughout his speech to 300 people attending the St. John’s Board of Trade luncheon.
Many of those opportunities flow from the Maritime link connecting the island portion of the province with the rest of the North American electrical grid.
One example: the possibility of generating electricity from natural gas, also known as gas-to-wire. It’s also an alternative to building pipelines to export natural gas.
The idea came up during a question and answer session with the audience.
Martin said gas-to-wire is not a key focus for Nalcor right now, but it could be a long-term opportunity.
“We’re always looking for any opportunities,” he told reporters following the speech.
“It’s no secret that we’ve hit gas at Parsons Pond. We don’t know the quantity yet.”
Nalcor has drilled two onshore exploration wells on the province’s west coast and reported gas shows in both. It will flow test those wells to figure out how much gas might be there.
“What I was trying to talk about here today was the types of opportunities that a line like this — the Maritime link — opens up,” Martin said.
“If we happen to have a commercial find — if we did — and we happen to have excess capacity on this line, which I expect we will as we pull power back … we could take natural gas and turn it into electricity for export.”
The Maritime link is the last of the three-stage plan to develop 824 megawatts of power from Muskrat Falls and build an 1,100-kilometre transmission line to bring that Labrador power to the island.
Martin said converting natural gas to electricity would also require a small gas turbine plant and a lot of study.
“Our focus right now, no question, is the Lower Churchill … and that’s going to be a five- to six-year construction project.
“We’d have to see if gas was there, we’d have to run the economics, it would be sometime after that. But, once again, five or six years is not that long a time.
“These are long-term deals. It gives long-term opportunities.”
Martin was also asked if the deal with Emera Inc., which will contribute $1.8 billion to the hydro project, includes sending power to the province if it’s needed.
“Power can flow both ways,” he said.
Nalcor hasn’t figured out the financial details, but Martin outlined one scenario in response to the question.
“If we wanted to, we could take a terawatt-hour of power — the amount of power we’re selling to Nova Scotia. We could take our reservoirs and drop the levels lower than we’ve been carrying them for the past 30 years, because we have so much reliability coming either way we don’t have to store water.
“We can pull power from elsewhere if we get caught.
“I wish I could put more value on it.
“The point is … the reliability improvements here are immense.”
mbaird@thetelegram.com
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Since the Lower Churchill is becoming a reality, the government of NL should offer Quebec a one time deal of partnering with NL on this project, by opening the Upper Churchill contract. Failure to get the Upper Churchill back on the table NL would put into law that when the Upper Churchill contract ends, all available power will be transmitted via the Maritime Link to the U.S.A. and illegal to be sold to Quebec !!!!!!!!!!!