Encana deferring work at Cabin Gas Plant
by Kathy Smith
Encana media spokesperson Jay Averill commented on the decision announced Monday to defer the commissioning of Cabin Phase 1 and construction of Cabin Phase 2. The decision was revealed in the press release talking about how their footprint will be extended in the Peace River Arch region, and lessened in the Horn River Basin.
Averill says the reason is consistently low gas prices over time; “Due to that, there has been a movement by producers from dry gas in the Horn River Basin, to moving their capital and spending into liquid-rich oil and natural gas. As a result of the lower gas price you are seeing that shift of investment. There just isn’t enough gas being produced in the region to warrant the addition of the new facility. That goes back to the agreement Enbridge and Encana talked about yesterday with moving into the Peace River area (liquid rich for Encana), and where we see the need for that infrastructure more immediately.” Averill added, “That’s the staging of events that resulted in this final decision – it’s a logical business decision, but it still makes it very difficult when you are talking about laying off people.”
They are in the midst of determining the expertise required to finish work at the site. “For the most part it’s a layoff situation. For contractors it’s comparable to a project ending, and they will go off to where they may want to go or are needed. It does mean a number of layoffs at this point,” says Averill.
In the short term, he says less staff will be required. Plant #1 will be put into ‘safe-mode’ which will take four to six months, and plant #2 will continue to see delivery of equipment, with some construction. It will then also be put into safe mode, and work there is expected to continue into 2013. “When we get into the third quarter of 2013, things will really start to wind down and eventually the site will be put down, disabled, and left there with no one there for the time being.” At this time it is unknown when development of the Cabin Gas Plant can begin again.
Follow
Recent Comments