Malaysian energy giant, Petronas has agreed to purchase a 25 percent stake in the Shell-led C$40 billion ($31 billion) LNG Canada project in British Columbia.
Once the transaction is completed, the composition of ownership in the project will be Petronas, through its North Montney LNG unit (25 percent), Shell (40 percent), PetroChina Canada (15 percent), Diamond LNG Canada, a Mitsubishi Corporation unit (15 percent) and Kogas Canada LNG (5 percent).
Petronas, that scrapped its Pacific NorthWest LNG project in British Columbia in July last year, is exploring a number of opportunities that will allow it to up its production and monetization of its resources in North Montney, LNG being one of them, Petronas’ president and CEO Wan Zulkiflee Wan Ariffin said.
Petronas and its North Montney joint venture partners hold over 52 Tcf of reserves and contingent resources in Canada.
The proposed Canada LNG 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 LNG trains each with the capacity to produce at least 6.5 million tons per annum (mtpa) of LNG, with an option to expand the project in the future to four trains.
A joint venture by Fluor Corporation and JGC has been selected to provide the engineering, procurement and construction work on the project.
In its statement, following the agreement with Petronas to grab an equity stake in LNG Canada, Shell said the EPC joint venture is currently finalizing materials in preparation for a final investment decision (FID) by joint venture participants.
Shell stressed that the timing of the final investment decision will depend on global energy markets, and the overall competitiveness and affordability of the project.