The Commission of the Canada Energy Regulator (CER) has given the go-ahead for the first compressed natural gas (CNG) facility in the Northwest Territories.
The CER has approved the Inuvialuit Energy Security Project (IESP) Energy Centre project, which will convert natural gas into compressed natural gas, propane, and synthetic diesel that can be used for power and heating. The facility will supply the Inuvialuit Settlement Region with reliable energy, reducing dependence on imported fuel trucked or barged in from southern Canada, the regulator said in a news release.
The IESP facility is located approximately 9.94 miles (16 kilometers) south of Tuktoyaktuk and 2,5 miles (four kilometers) west of the Inuvik-to-Tuktoyaktuk highway in the Northwest Territories. It is situated in the Inuvialuit Settlement Region, where the Inuvialuit own land and resources. Inuvialuit Energy Security Project Ltd. (IESP), a wholly owned subsidiary of the Inuvialuit Petroleum Corporation, is leading the project, which is expected to provide sustainable energy for the next 50 years.
According to the release, the decision is the final of three authorizations from the commission allowing for the construction and operation of the project. The other two authorizations for early site work and certain well-workover activities at the TUK M-18 well were issued on June 28, 2023. With the approval, IESP can now complete the final cost analysis of the project.
Once IESP reaches a final investment decision (FID), major gas processing equipment and modules will begin construction in 2024. Major onsite construction and commissioning will take place in late 2024 and throughout 2025, the company said. At the end of 2025, gas will be produced and trucked to consumers.
The Inuvialuit Regional Corporation said that the project will provide a replacement for the diminished Ikhil gas well and reduce reliance on “expensive southern fuel and exposure to intermittent road outages”. Further, the project will create opportunities for local businesses and mitigate the high cost of living and doing business in the region. Imported diesel will be replaced with a locally produced and reliable energy source, while reducing the environmental footprint of the current energy infrastructure in the region.
The CER said it considered input from elders, harvesters, youth, local leaders, community members, and co-management bodies to help shape IESP’s mitigation and management plans and engineering approaches.
Throughout the regulatory process, the CER outlined that it focused on protecting the North’s unique and sensitive environment including permafrost, wildlife and species at risk. Among the conditions for the approval are preventing permafrost melt, monitoring noise to protect humans and wildlife, and implementing a seven-year post-construction environmental monitoring program to account for slower vegetation growth rates in the North.
The CER said it included additional conditions focusing on environmental protection, safety, emergency response, and operational readiness.
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