Canadian LNG producers are in pole position to meet the growing energy demand in Asia, particularly to replace coal with low-carbon LNG that is planned to be produced from a string of grassroot facilities along the Pacific Coast in British Columbia, officials said at an industry event.

“Canadian LNG has 60% less carbon intensity than an average US Gulf Coast facility,” LNG Canada Vice President Teresa Waddington said late Jan. 17. “That’s a remarkable innovation and really demonstrates as to how Canada is at the forefront of delivering climate solutions and less intensive greenhouse gas LNG.”

Waddington made these comments on a webcast at the 21st BC Natural Resources Forum at Prince George in British Columbia.

The Shell-led LNG Canada project is now 90% complete and “we are bringing Canada’s first LNG facility to life,” Waddington said.

LNG Canada plant is preparing for safe start up in 2024 of its first-phase project at Kitimat, it said in its latest update mid-December.

LNG Canada is a joint venture between operator Shell (40% interest), Petronas (25%), PetroChina and Mitsubishi Corp. (both 15%) and Korea Gas Corp. (5%) that is building a grassroot plant in two equal phases each of 14 million mt/year.

Low-carbon Canadian LNG is being touted as an advantageous factor for Asia as it still continues to burn coal for power generation.

Four LNG projects are at various stages of development in British Columbia that are targeting low GHG levels. The facilities are: Ksi Lisims project that will have a carbon intensity level of 0.02 MT of carbon dioxide equivalent; 0.16 MT of CO2e for Shell-led 14 million mt/year LNG Canada; 0.04 MT of CO2e for the 2.1 million mt/year Woodfibre; and 0.08 MT of CO2e for the 3 million mt/year Cedar LNG, according to the individual producers.

While LNG Canada is targeting to export its first cargo late 2024/early 2025, construction work is well underway for the Woodfibre LNG facility and final investment decision is due in the first quarter of 2024 for the Cedar LNG facility. Lastly, Ksi Lisims signed last week an offtake agreement for 2 million mt/year (or one-sixth of its total plant capacity) with Shell and is pursuing additional deals while at the same time is going through a provincial government regulatory process as part of taking a FID.

“China and India are the two largest emitters [of greenhouse gases] in Asia and there is still smog in the sky indicating they are burning coal for power generation,” Karen Ogen, CEO of First Nations LNG Alliance, said at the same event.

The alliance represents multiple First Nations indigenous bands of British Columbia that play a significant role in developing the grassroot LNG facilities as traditionally they have complete ownership and access to those lands where the projects are being built.

“Canadian LNG is primarily indigenous LNG as we are [part] owners of these projects,” Ogen said.

First Nations bands are partners on the Woodfibre LNG (Squamish Nation), the Cedar LNG (Haisla Nation) and the Ksi Lisims projects (Nisga’a Nation). All these projects are targeting offtake agreements with Asian buyers.

“There is space for all and we need more. Canada is leading the way with indigenous LNG,” Waddington said.
Stepping up to meet demand

“Supply chains are shifting, geopolitics is shifting,” director of policy for Petronas Bryan Cox said at the same event. “What will Canada’s role be in the world? Will we continue to be the helper nation that we’ve always been? I think the answer is yes. We’re showing that today with projects like the LNG Canada projects. It’s our opportunity to get out there and play our part in the world with our natural resources.”

As part of Canada’s role in meeting the Asian energy demand, producers from British Columbia are already exporting 100,000 b/d of LPG, CEO of the Canadian Propane Association Shannon Watt said at the same event.

That figure is set to rise further as midstream players like AltaGas and Trigon Pacific Terminals are planning the construction of marine facilities in Prince Rupert along the Canadian Pacific Coast.

“Natural resources are a big part of what we export and in 2024 we have C$2 billion [$1.48 billion] of investment coming into the port,” Ken Veldman, a vice president with the Prince Rupert Port Authority said at the same forum.

Trigon Pacific Terminals has submitted a regulatory application to the Prince Rupert Port Authority for its planned LPG export terminal, while in late 2023 a joint venture of AltaGas and Royal Vopak said it was working towards a FID in the first half of 2024 to build an LPG, methanol and bulk products export marine terminal at the Ridley Island.
Source: Platts