(EnergyAsia, December 11 2012, Tuesday) — With its successful C$5.9-billion capture of Canada-based Progress Energy, Malaysian state oil firm Petronas expects to complete the development of a natural gas project culminating in the export of liquefied natural gas (LNG) from a terminal off Prince Rupert by 2018.
The project, costing between C$9 and C$11 billion, will draw natural gas from the provinces of British Columbia and Alberta to be processed at the terminal on Lelu Island for export to long-term customers in Asia.
The companies expect to make a final investment decision in late 2014, they said in a joint statement welcoming last Friday’s announcement by the Canadian government that it had approved Petronas’s takeover of the Toronto-listed, Calgary-based Progress Energy.
“Petronas’s well-established and extensive network of LNG customers will add value to Canada’s natural gas resources and provide a strategic alternative to the traditional North American natural gas market,” the companies said.
Shamsul Azhar Abbas, Petronas’s President and CEO, said the project comprises three major components:
– The Pacific Northwest LNG export facility on Lelu Island in the District of Port Edward, near Prince Rupert;
– Development of natural gas reserves and production in the Montney region of northeast British Columbia and northwest Alberta;
– The eventual installation of a natural gas transmission pipeline, built by a third-party pipeline company, to move natural gas from the production fields to the LNG export facility.
“These components will create thousands of well-paid jobs during construction of the facility and pipeline, as well as permanent, ongoing operating jobs throughout our LNG business, from the Montney region to the West Coast,” he said.
Michael Culbert, Progress Energy’s President and CEO, said:
“This approval by the Canadian government marks a vital step in our plans to develop a LNG export business and opens promising new business opportunities for Progress, British Columbia and Canadian trade expansion.
“Canada has great potential in the global LNG market – a growing market that’s already worth more than $300 billion per year. While international LNG trade is intensely competitive, new facilities such as our Pacific Northwest LNG project are vital to building Canada’s market position.”
The partners recently announced that the Pacific Northwest LNG project is moving into the pre front-end engineering design (FEED) phase to ascertain construction timelines, costs and labour force requirements.
“The construction phase would result in up to 3,500 direct jobs and the long-term operations of the facility would result in 200 to 300 direct jobs,” the companies said.
Pacific Northwest LNG will be opening an office in Vancouver, British Columbia in early 2013 to grow its project team.