Construction of AltaGas' 40,000 b/d propane export terminal at Ridley Island on the western coast of Canada, will likely begin in a few weeks following the company's final investment decision on the project announced earlier this month, said Jamie Fisher, exports director for AltaGas.
Fisher, speaking at the Argus Americas LPG Summit in Houston, Texas, today, confirmed the company expects the terminal to begin operations in the first quarter of 2019. A finalized sales agreement with Japanese buyer Astomos, which has already signed an MOU for half of the offtake, is underway, he said.
AltaGas received a 25 year license from the National Energy Board for 46,000 b/d of exports. Propane from western Canada will be railed to the site.
Canadian producers will see a better return on their propane by exporting, he said.
"The netback would be Japan minus 30¢-40¢/USG," he said, accounting for rail costs of between 25¢-30¢/USG. "As long as we're able to keep our rail costs down we're going to see better netbacks for producers."
"Western Canadian producers are competitive with other regions; we're a dime better than the Utica, we're a dime better than the Bakken," he said.
