LNG Canada announces positive final investment decision

It's official — the LNG Canada project slated for Kitimat will be built.

LNG Canada and its joint venture partners will sign documents alongside government officials Tuesday morning in in the Emerald Ball Room of Fairmont Pacific Rim in Vancouver at 8:30 a.m.

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Attending the ceremony will be:

  • Andy Calitz, CEO LNG Canada
  • Prime Minister Justin Trudeau
  • Premier John Horgan
  • Haisla Chief Councillor Crystal Smith
  • Kitimat Mayor Phil Germuth
  • Martaan Westelaar, Director Integrated Gas and New Energies, Shell, on behalf of the Joint Venture Partners

“The Final Investment Decision taken by our joint venture participants shows that British Columbia and Canada, working with First Nations and local communities, can deliver competitive energy projects,” CEO Andy Calitz said in a news release late Monday night.

“This decision showcases how industrial development can co-exist with environmental stewardship and Indigenous interests.”

The event will be livestreamed at facebook.com/LNGCanada.

Royal Dutch Shell Plc is the lead partner in LNG Canada, with a 40 per cent stake. The project is rounded out by Petronas, which holds 25 per cent, Petro China and Mitsubishi, which each hold 15 per cent, and Korea Gas Corp., which holds five per cent.

The investment decision is for two processing units, called trains, that will liquefy natural gas sourced from Northeast B.C. and then shipped overseas.

Each project partner will supply its own gas for the project, with the first LNG expected to before the middle of the next decade, according to the release. Each partner will also offtake and market its share of LNG.

The cost of the investment decision wasn't released, but LNG Canada has been estimated to cost up to $40 billion, the largest private investment in B.C. and Canadian history.

That includes TransCanada's $4.8-billion Coastal GasLink pipeline, which will transport natural gas from the Groundbirch area in Northeast B.C. to the facility in Kitimat.

Two Fort St. John contractors, Surerus Pipeline and Macro Industries, have joint venture projects hired to build segments of the pipeline.

The plant and pipeline will employ approximately 10,000 people at peak construction, according to a news release. There will be up to 900 people at the plant during the operations of its first phase.

Martaan Westelaar, Shell's director for integrated gas and new energies, said much work has been done since 2016, when an investment decision was postponed. The project includes a consortium with "deep LNG industry experience," she said.

“In the last two years, LNG Canada has improved its competitiveness, reduced execution uncertainty and gained significant stakeholder support," Westelaar said in the release.

"Together with our joint venture participants and contractors, we look forward to working with the local community, First Nations, government and the LNG Canada team to build and operate this game changing project for Canada’s energy industry.”

Prime Minister Justin Trudeau — whose government has been beleaugured and widely criticized for its handling of the Trans Mountain oil pipeline — called the news a "vote of confidence" for the country in the release.

“Today’s announcement by LNG Canada represents the single largest private sector investment project in Canadian history," he said.

"It is a vote of confidence in a country that recognizes the need to develop our energy in way that takes the environment into account, and that works in meaningful partnership with Indigenous communities.”

This is a developing story.

Email Managing Editor Matt Preprost at editor@ahnfsj.ca.

@ Copyright 2018 Pipeline News North

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