Petronas buys 25% stake in Canadian LNG project

PETALING JAYA: Petroliam Nasional Bhd (Petronas) is acquiring a 25% stake in a liquefied natural gas (LNG) project in Kitimat, Canada, after it scrapped plans for the Pacific NorthWest LNG project in the country last July due to challenging market conditions as a result of prolonged depressed prices.

Petronas said in a statement that its wholly owned entity the North Montney LNG Ltd Partnership had entered into a purchase and sale agreement for the deal. The purchase sum was not disclosed.

Other shareholders of the project are Royal Dutch Shell’s Shell Canada Energy (40%), PetroChina Canada (15%), Mitsubishi Corp subsidiary Diamond LNG Canada (15%) and Kogas Canada LNG (5%).

The transaction, due to be completed in the next few months, is subject to international regulatory approvals and the completion of other associated agreements.

“Petronas is in Canada for the long term and we are exploring a number of business opportunities that will allow us to increase our production and accelerate the monetisation of our world-class resources in North Montney. LNG is just one of those opportunities,” said Petronas president and group CEO Tan Sri Wan Zulkiflee Wan Ariffin.

The proposed project includes the design, construction and operation of a gas liquefaction plant and facilities for the storage and export of LNG, including marine facilities.

The plant will initially consist of two world-scale LNG processing units referred to as “trains”, with an option to expand the project in the future to four trains.