6/2/2024
(P&GJ) — Calgary-based AltaGas Ltd. and Royal Vopak from Rotterdam have jointly announced their decision to move forward with the construction of the Ridley Island Energy Export Facility (REEF) in British Columbia, Canada.
The facility, located on Ridley Island, will serve as a significant hub for exporting liquefied petroleum gas (LPG) and bulk liquids, further strengthening Canada’s position in the global energy market.
The decision follows an extensive five-year process that included environmental assessments and consultations with various stakeholders, including Indigenous groups and local communities. Both companies have committed to ensuring the facility operates with the highest environmental standards.
With site clearing nearly complete, construction is expected to commence soon, aiming for operational status by the end of 2026. The total projected cost of the project stands at $1.35 billion, with anticipated annual earnings ranging between $185 million to $215 million. Importantly, AltaGas and Vopak plan to fund their respective 50 percent stakes without leveraging.
The strategic location of the REEF facility, with just ten shipping days to key Asian markets in Northeast Asia, provides a competitive advantage for Canadian energy exports. This proximity is expected to facilitate expedited deliveries and enhance trade between Canada and the Asia Pacific region.
Leadership from both companies emphasized the project’s significance in connecting Canadian energy resources with global markets. Vern Yu, President and CEO of AltaGas, highlighted the role of the facility in strengthening Canada’s energy exports to Asia, citing its ability to deliver LPGs efficiently while prioritizing environmental sustainability.
Dick Richelle, Chairman of the Executive Board and CEO of Royal Vopak, echoed Yu’s sentiments, emphasizing the strategic importance of Prince Rupert’s location in driving progress and increasing trade between Canada and Asia. Richelle praised the collaborative efforts with AltaGas and other stakeholders, emphasizing their commitment to sustainable energy infrastructure.
Construction of the facility will entail approximately $875 million for the main plant and storage tanks, along with $475 million for the construction of a new jetty and extensive rail and logistics infrastructure. The project is expected to generate significant economic benefits for Northwestern British Columbia, including job creation and community investment initiatives.
The approval of the Ridley Island Energy Export Facility marks a significant step forward for Canada’s energy sector, promising to enhance the country’s role as a global energy exporter while adhering to the highest environmental and community standards.
