Canada: Gas Reserves LNG Canada Project May Add Petronas for Equity Position
The LNG Canada project aims at building a LNG export facility in Kitimat, British Columbia, Canada. Petronas may join in the project if the company meets all the regulatory approvals and closing conditions.
Canada – Shell Canada Energy, Petro China Kitimat LNG Partnership, Diamond Canada and Kogas Canada LNG have recently announced that Petroliam Nasional Berhad (Petronas) will take an equity position in LNG Canada, located in Kitimat, British Columbia on the west coast of Canada, through its wholly owned entity the North Montney LNG Partnership (NMLLP), subject to regulatory approvals and closing conditions.
As a result of this transaction, if approved and upon closing, ownership interests in LNG Canada would be Shell Canada Energy, a subsidiary of Royal Dutch Shell (Shell) (40 %); Petronas (through NMLLP) (25 %); Petro China Kitimat LNG Partnership, a subsidiary of Petro China Canada (15 %); Diamond LNG Canada, a subsidiary of Mitsubishi Corporation (15 %); and Kogas Canada LNG (5 %).
British Columbia (B.C.) is home to one of the largest and most accessible sources of natural gas in the world. If constructed, LNG Canada participants will ship natural gas, including from B.C.’s vast reserves, to various countries where the imported gas could displace more carbon intensive energy sources, helping to reduce greenhouse gas emissions.
LNG Canada recently selected the joint venture JGC Corporation (JGC) and Fluor Corporation (Fluor) as the Engineering, Procurement and Construction (EPC) contractor for the project and is currently finalising materials in preparation for a final investment decision (FID) by joint venture participants.
The transaction that has been recently announced does not amount to an FID which remains pending. The timing and outcome of an FID will be decided by joint venture participants based on global energy markets, and the overall competitiveness and affordability of the project.