Two LNG export facilities in British Columbia progress towards mid-decade opening, with global LNG trade expected to reach 700 mta by 2040
With LNG trade to nearly double by 2040, led by growth in Asia, the projected opening of two LNG export projects in western Canada by mid-decade seem well timed.
In April, Woodfibre LNG gave prime contractor McDermott International the green light to begin laying the groundwork for major construction activity at the site in Squamish, British Columbia in 2023. In November, Woodfibre LNG’s Singapore-based parent, Pacific Energy, signed an engineering, procurement, fabrication, and construction (EPFC) contract with McDermott ahead of the notice to proceed.
Woodfibre LNG is developing an LNG export facility with a single LNG train on the site of a former wood pulp mill. The facility will have floating storage capacity of 250,000 m3 and produce about 2.1 mta of LNG, using 100% renewable hydroelectric technology. Besides using hydroelectricity for the liquefaction process, the facility will deploy technology that enables liquefaction machinery to restart without flaring, a recycling system for boil-off gas (BOG), and additional transformers, switchgear and transmission lines. As a result, Woodfibre LNG will be “the lowest-emission, most sustainable and innovative LNG export facility in the world,” according to Woodfibre LNG president Christine Kennedy.
“Woodfibre LNG will be the lowest-emission, most sustainable and innovative LNG export facility in the world”
Asia and China in particular will be a primary target for Canadian natural gas. According to Shell LNG Outlook 2022, global LNG trade will nearly double to 700 mta by 2040, with Asia absorbing about 70% of the LNG demand growth. China imported 79M tonnes of LNG in 2021, becoming the world’s top importer.
Using natural gas from British Columbia’s Montney region to feed Woodfibre LNG, and by replacing coal-fired energy sources in Asia, global emissions will be reduced by 3.5M tonnes CO2e annually, says the company.
Woodfibre LNG is targeting substantial completion by Q3 2027. Over 70% of its annual production has been sold, underpinned by two offtake agreements with BP.
Canada’s largest LNG export facility
Meanwhile, Canada’s largest LNG export project, the Shell-backed US$40Bn LNG Canada project, is more than half completed. In March, a 4,618-t inlet facilities module was delivered to the Port of Kitimat. It will serve as the entry point for natural gas delivered to the LNG Canada site via the new Coastal GasLink (CGL) pipeline.
With four trains planned, LNG Canada will initially open with two trains, with a nameplate production capacity of 14 mta by mid-decade.
In April, Jason Klein, Shell Canada’s VP Canada Integrated Gas, was named chief executive of LNG Canada, succeeding Peter Zebedee. “LNG Canada and its joint venture participants are committed to setting the benchmark for economically, environmentally and socially responsible LNG development in Canada,” said Mr Klein.
LNG Canada investors are led by Shell Canada Energy with a 40% stake, with partners PETRONAS, holding a 25% interest, PetroChina Canada, 15%, Mitsubishi subsidiary Diamond LNG Canada Partnership, 15% and Kogas Canada LNG 5%. It is operated through LNG Canada Development Inc.
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