B.C.’s LNG out­look dims

The Guardian (Charlottetown) - - CANADA -

The dream of a boom­ing liq­ue­fied nat­u­ral gas in­dus­try in Bri­tish Columbia ap­pears to be fad­ing, at least for the fore­see­able fu­ture, af­ter Petronas and its part­ners scrapped a $36-bil­lion megapro­ject in the prov­ince, ex­perts say.

A con­sor­tium led by Malaysia-owned Petronas an­nounced Tues­day it would not pro­ceed with the Pa­cific NorthWest LNG project near Port Ed­ward, B.C., due to an “ex­tremely chal­leng­ing en­vi­ron­ment” brought on by pro­longed low prices.

The project would have in­cluded a nat­u­ral gas ex­port ter­mi­nal on Lelu Is­land on the prov­ince’s north­ern coast and a 900-kilo­me­tre pipe­line to bring the nat­u­ral gas in from north­east­ern B.C.

The pro­po­nents of two other ma­jor pro­jects, Shell-backed LNG Canada and Chevron’s Kiti­mat LNG, say they are pro­ceed­ing to­ward fi­nal in­vest­ment de­ci­sions, but an­a­lysts pre­dict the fa­cil­i­ties are un­likely to be built in the next three to five years - if at all.

“I’d say it’s a pretty low pos­si­bil­ity. It’s not quite zero, but the Shell LNG project is also a very big, ex­pen­sive green­field project,” said Martin King, vice-pres­i­dent of in­sti­tu­tional re­search at GMP First En­ergy.

Shell, along with PetroChina, KOGAS and Mit­si­bushi, have formed a joint ven­ture com­pany called LNG Canada that has pro­posed an ex­port ter­mi­nal in Kiti­mat on B.C.’s north coast. It in­def­i­nitely de­layed mak­ing a fi­nal in­vest­ment de­ci­sion in July 2016.

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