Shell Canada Energy, PetroChina Kitimat LNG Partnership, Diamond LNG Canada Ltd. and Kogas Canada LNG Ltd. have 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 Limited 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 plc (“Shell”), (40%); PETRONAS (through NMLLP), (25%); PetroChina Kitimat LNG Partnership, a subsidiary of PetroChina Canada Ltd., (15%); Diamond LNG Canada Ltd., a subsidiary of Mitsubishi Corporation, (15%); and Kogas Canada LNG Ltd. (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 of 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 announced today 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.