Shell-Led Gas Export Project in Canada Granted 40-Year Export License
January 07 2016 - 9:40PM
Dow Jones News
CALGARY, Alberta—Canadian regulators on Thursday approved a
40-year export license for a liquefied natural gas plant proposed
for Canada's Pacific coast by a consortium led by Royal Dutch Shell
PLC.
The Canadian National Energy Board granted the permit, which it
called the longest ever issued, after receiving an application in
July from Shell and other sponsors of the project, which is called
LNG Canada.
It comes at a challenging time for Shell and its partners due to
slumping global crude oil and LNG spot market prices.
The LNG Canada project is one of nearly two dozen terminals
proposed for Canada's western coast that would ship natural gas in
liquefied form to energy-hungry markets in Asia. None has been
built yet amid concerns about costs and regulatory hurdles.
The NEB permit allows for annual export of up to 1.34 trillion
cubic feet of natural gas, which is the equivalent of 3.7 billion
cubic feet a day, and requires LNG Canada to start exports by
2022.
Representatives for the project were unavailable for immediate
comment, but Shell has said it would take about five years to build
and that it expects to make a decision on whether to proceed with
construction by "mid-decade."
The LNG Canada export terminal, which is expected to cost as
much as 40 billion Canadian dollars ($28.39 billion), became the
first LNG project to receive a facility permit from the government
of British Columbia's Oil and Gas Commission earlier this week.
Canada has looked to LNG exports as an outlet to ease a North
American natural gas-supply glut and the government of British
Columbia has sought to nurture a LNG industry to attract investment
and create jobs.
Shell's Canadian unit owns half of the Canadian project in
partnership with affiliates of Chinese state-owned energy company
PetroChina Co., which owns another 20%, along with 15% stakes each
for Korea Gas Corp. and Japan's Mitsubishi Corp.
Write to Chester Dawson at chester.dawson@wsj.com
(END) Dow Jones Newswires
January 07, 2016 21:25 ET (02:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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