The market price for natural gas in Alberta dipped below $2 per thousand BTUs in June 2017, but the suppressed price is being viewed as an opportunity to bring power and economic prosperity to remote communities in northwest Alberta.
Lionstooth Energy is proposing a relatively small modular power facility that could use natural gas from nearby fields in northern Alberta as a feedstock with little to no processing, while generating around five megawatts of power – enough to power approximately 5,000 homes.
It’s the type of project Lionstooth Energy specializes in and sees as a growth area in the province. They anticipate working on four to five projects of this size every year for the next five years, using natural gas to fuel distributed power generation plants.
“On the one side, it’s really tough for producers to economically sell gas in the province now,” says Geoff Lester, president and CEO of Lionstooth Energy. “On the other hand, electricity prices in Alberta are going up. They are going to keep going up for a while in order to support the transition away from coal-fired generation.”
The Regional Economic Development Initiative for Northwest Alberta (REDI) has been working with Lionstooth Energy to determine the feasibility of distributed power generation using natural gas. The idea is to allow the region to generate power locally, while creating and maintaining jobs with service companies through sustaining the local natural gas fields.
“Our local expertise is in the oil and gas industry, and this complements this knowledge,” says Lisa Wardley, a councillor with Mackenzie County. “It kickstarted us to say, how do we help our communities stay viable while using much of the same infrastructure, minimizing footprint and using the resource for the betterment of the residents and businesses in the area.”
Mackenzie County is situated approximately 700 kilometres from Edmonton and is Alberta’s largest county, covering 80,000 square kilometres in the northwest corner of the province. Wardley is also chair of REDI and notes that the community has been hit hard by the slump in natural gas prices.
“The last few years have been tough for everyone,” says Wardley.