Update on LNG-Related Activity in British Columbia: Regulatory and Contracting Advances

British Columbia’s new liquefied natural gas (LNG) sector was particularly lively in the weeks since our mid-December update.  To keep our readers up-to-date, we have prepared the following brief summary of recent notable LNG sector activity.

Since our last post:

  • The National Energy Board (NEB) approved applications for 25 year natural gas export licences to export LNG to:
    • Prince Rupert LNG Exports Ltd., proposed by the BG Group, for a maximum of 21.6 million tonnes per year and 592 million tonnes over the term;
    • Pacific NorthWest LNG Ltd., proposed by PETRONAS/Progress Energy, for a maximum of 19.68 million tonnes per year and 555 million tonnes over the term;
    • WCC LNG Ltd., for Imperial Oil and ExxonMobil Canada Ltd., for a maximum of 30 million tonnes per year and 800 million tonnes over the term; and
    • Woodfibre LNG Export Pte. Ltd., proposed by Woodfibre Natural Gas Limited, for a maximum of 2.1 million tonnes per year and 60.375 million tonnes over the term.
  • Kitsault Energy Ltd. applied to the NEB for a permit to export a maximum of 20 million tonnes of LNG per year, for a maximum of 960 million tonnes over a 25-year term.  The proposed project will be located at Kitsault, BC, a privately-owned abandoned mining town on the north coast of BC.  Kitsault Energy does not own any gas reserves and is seeking to finalize supply arrangements for the proposed export plant.
  • The Kitimat LNG Project, a joint venture between Chevron Canada Limited and Apache Canada Limited, awarded an engineering, procurement and construction (EPC) contract for the facility to a joint venture of Texas-based Fluor Corp. and Japan-based JGC Corp.  A final investment decision for the Kitimat LNG Project is expected later in 2014.
  • The BC government announced that it has entered a “sole proponent agreement” with Woodside regarding the southern parcel of Grassy Point near Prince Rupert.  This agreement provides Woodside with the exclusive right to negotiate a long-term Crown tenure for an LNG facility at the site.  For those that are not familiar with Woodside, it is the largest independent operator of oil and gas production in Australia.

We expect that BC’s LNG sector will be active throughout 2014 as proponents take steps towards making their respective final investment decisions. We will continue to monitor the sector and continue to update our blog accordingly.

liquefied natural gas LNG National Energy Board NEB Regulatory and Contracting Advances

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