Published: Fri, October 05, 2018
Sci-tech | By April Francis

Trudeau Backs LNG Canada Against Threat of Steel Duties

Trudeau Backs LNG Canada Against Threat of Steel Duties

First gas from the project is expected before 2025, aiming to feed an expected surge in demand for the cleaner, super-chilled fuel from hungry Asian buyers, mainly China.

In Edmonton, Alberta Trade Minister Deron Bilous said the announcement is good news but also a fundamental inequity when compared with the stalled Trans Mountain pipeline project.

The report noted that LNG Canada proposes to eventually export as much as 26 million tons per year, but that this investment approval is only for an initial two LNG trains of 13 million tons per year.

"We are within 10 days shipping of Tokyo or Shanghai", said Maarten Wetselaar, director of integrated gas and new energies at Royal Dutch Shell, of the reasoning for proceeding with the investment, less than half the Gulf Coast projects' shipping times of 24 days to Asia.

Anglo-Dutch energy giant Shell and its partners have finally given the green light to an enormous liquified natural gas project in Canada.

LNG Canada officials have said in the past that gas turbines would be driving the facility's liquefaction process and that electricity would only be needed for ancillary power.

Trudeau said the project stands to "benefit all Canadians".

KOGAS said this will be Korea's first major project in Canada. Two Fort St. John contractors, Surerus Pipeline and Macro Industries, have joint venture projects selected to build segments of the pipeline.

Pipeline operator TransCanada Corp said on Tuesday it will proceed with the construction of its Coastal GasLink pipeline, which will transport natural gas from the Montney gas-producing region near Dawson Creek, British Columbia, to the LNG Canada facility in Kitimat.

"Beyond this, we believe this project has the potential to be the first of many on the West Coast of Canada", if Canadian LNG follows the global standard, being that LNG export areas tend to be "hubs" of terminals, rather than standalone facilities", they wrote.

'We see that LNG Canada's FID would signal the appetite to invest in LNG is back, ' Kavonic said.

The project owners will be responsible for providing their own natural gas supply and will individually offtake and market their share of LNG, LNG Canada said in the statement. From Australia to Africa, LNG developments typically have been underpinned by long-term sales contracts to minimize financial risk on multibillion-dollar investments that can take half a decade or longer to construct.

Jowdy added that the trade war between the United States and China - specifically, perceptions about the political risk of supplying US -sourced LNG to China - could dampen the prospects for some next-generation Gulf Coast projects.

Karen Ogen-Toews, First Nations LNG Alliance CEO called the final investment decision "great news for the B.C. economy, for Canada, and for First Nations".

Dale Dusterhoft, CEO of Trican Well Service Ltd., one of Western Canada's largest oil and gas services firms, says he doesn't expect any increase in drilling in the next year or so but the demand will start to expand gradually after 2020 as LNG Canada's completion date nears.

"China will account for roughly 35 percent of total demand growth over the next five years and, at this point, they are under-contracted", Jowdy noted.

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