Canadian LNG, Pipeline Projects Get Green Light

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Researched by Industrial Info Resources (Sugar Land, Texas)--Royal Dutch Shell plc (NYSE:RDS.A) (The Hague, Netherlands) and its partners have made a positive final investment decision on the massive LNG Canada liquefied natural gas (LNG) project in Kitimat, British Columbia. Accompanying this is TransCanada's (NYSE:TRP) (Calgary, Alberta) Coastal GasLink natural gas pipeline, which will supply the plant with gas. Industrial Info is tracking more than $121 billion of possible LNG projects in Canada.

The LNG Canada project will feature two LNG production trains to produce a total of 14 million metric tons per year of LNG. A potential third and fourth train could be added to the plant in the future. Located on the west coast of Canada, the plant will be in a good location to supply Asian markets, which are hungry for North American LNG. The project has a 40-year export license in place, as well as all major environmental permits. A joint venture of Fluor Corporation (NYSE:FLR) and JGC America Incorporated (Houston, Texas) is providing engineering, procurement and construction (EPC). For more information, see Industrial Info's project reports on initial construction and trains 3 and 4.

Shell, which has 40% interest in the project, has several partners, including:

• Petroliam Nasional Berhad (PETRONAS) (Kuala Lumpur, Malaysia) (25%)
• PetroChina Company Limited (NYSE:PTR) (Beijing, China) (15%)
• Mitsubishi Corporation (Tokyo, Japan) (15%)
• Korea Gas Corporation (Daegu, South Korea) (5%)

To supply the plant, TransCanada has announced that it will construct the 420-mile Coastal GasLink pipeline, which will have an initial capacity of 2.1 billion cubic feet per day (Bcf/d) and the potential for expansion of up to approximately 5 Bcf/d. Construction on the pipeline is planned to begin in 2019, with an expected in-service date of 2023. WorleyParsons (North Sydney, Australia) is the design-engineer on the project, which has an estimated total investment value (TIV) of $4.8 billion. For more information, see Industrial Info's project report.

Most of the Canadian LNG projects that Industrial Info ranks as having a medium or high probability of being constructed are located in British Columbia. Among these is Steelhead LNG Corporation's (Vancouver, British Columbia) LNG plant on the Alberni Inlet, about 100 miles west of Vancouver. The facility initially would have two production trains to produce 12 million tons per year of LNG. WorleyParsons is the design engineer. Construction could begin in 2020, taking about four years to complete. The project has received approval from Canada's National Energy Board to export LNG for 25 years. A Phase II addition is possible for the plant, which would double production capacity. For more information, see Industrial Info's project reports on Phase I and Phase II.

Also planned for British Columbia is Woodfibre Natural Gas Limited's (Squamish, British Columbia) LNG production facility in Squamish. The plant would process 220 million cubic feet per day of natural gas to produce 2.1 million metric tons per year of LNG using two trains. Last year, the National Energy Board granted Woodfibre a 40-year license to export. Construction could begin next year, taking about three years to complete. KBR Incorporated (NYSE:KBR) (Houston) is performing engineering. For more information, see April 11, 2017, article - Woodfibre Granted 40-Year Export License for British Columbia LNG Export Facility and Industrial Info's project report.

While the larger LNG projects take some time to get underway, Industrial Info is tracking a micro LNG project in British Columbia that is nearing completion after nearly four years of construction. Fortis Incorporated (TSX:FTS) (St. John's, Newfoundland and Labrador) began construction on the addition of a second train at its facility near Delta, British Columbia, in the third quarter of 2014. The train will produce approximately 250,000 metric tons per year. Bechtel Group Incorporated (San Francisco, California) is providing EPC. For more information, see Industrial Info's project report.

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