North American LNG Race in High Gear

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Written by Daniel Graeber for IIR News Intelligence (Sugar Land, Texas)

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Summary

The LNG sector in North America is taking on geopolitical tones. Canada has a head start in deliveries from the West Coast, though the U.S. has prioritized Alaskan developments.

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Alaska Gets Shippers, B.C. Advances

The North American race to deliver liquefied natural gas (LNG) from its western shores accelerated with Glenfarne Alaska (Anchorage, Alaska) brokering an agreement to secure waterborne shipments, while the Woodfibre facility in British Columbia is now 60% complete.

As of now, the LNG Canada (Kitimat, British Columbia) facility in Kitimat is the only operational Canadian facility that's delivering the super-cooled gas outside of North America. The facility delivered its first batch of product last year, and operations began on the second liquefaction unit, or train. Train 2 would have a net capacity of 6.5 million metric tons per annum (MTPA) for exports of natural gas in the liquid form, bringing the total capacity to 14 MTPA.

The facility is emblematic of a Canadian push to halve the amount of U.S. trade over the coming years amid deep divisions among Western allies. U.S. President Donald Trump recently posted an image on social media of the U.S. flag over a map covering the United States, Canada, Greenland, Mexico and Venezuela.

Trump is embracing a form of the 19th-century Monroe Doctrine, which advocates for a U.S. sphere of influence over the Americas. Speaking at the World Economic Forum in Davos, Switzerland, Canadian Prime Minister Mark Carney was having none of it.

"Hegemons cannot continually monetize their relationships," he said, in a veiled reference to Trump's recent actions. "Allies will diversify to hedge against uncertainty."

Carney, meanwhile, maintained that Canada is an energy superpower, with a rules-based system that should be attractive to foreign investors.

On Monday, the developers of the planned Woodfibre LNG facility in British Columbia received two modules that would facilitate further construction, a pretreatment unit and a processing unit. That brings construction to nearly 60% complete.

"It's tremendously exciting to move another step closer to construction completion and bringing more Canadian LNG to global markets," said Luke Schauerte, the chief executive officer of Woodfibre.

Woodfibre would have an export capacity of 2.1 MTPA of LNG. Once completed in 2027, developers believe it will be the first net-zero facility of its kind in the world.

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Canada, meanwhile, is a net exporter of natural gas to the U.S. economy. IIR Energy in its NATGAS Today report put net Canadian gas imports at 6.9 billion cubic feet, up from last months average of 5.2 billion cubic feet per day (Bcf/d).

U.S. Playing Catch Up

For the United States, the LNG sector aligned with executive action from President Trump last year that listed Alaska as part of a strategy of energy dominance. The Alaska LNG facility is complex, requiring a lengthy pipeline in a climate where warming trends are limiting construction windows.

On Tuesday, developer Glenfarne Alaska said it reached a strategic agreement with ship owner Danaos Corporation (Cyprus) for six LNG carriers on top of a $50 million investment commitment.

"One of Alaska LNG's major competitive advantages is our short shipping distance to Asia, featuring canal-free routes avoiding contested waters," said Brendan Duval, the chief executive officer and founder of Glenfarne. "The addition of reliable shipping solutions meaningfully advances the development of Alaska LNG."

Long on the shelf, the facility isn't expected to be completed until 2030. Phase 1 calls for a pipeline to help address domestic Alaskan demand, while Phase 2 would add on liquefaction units that could deliver 20 MTPA.

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Alaskan developments come as European leaders mull the fate of a U.S. trade deal brokered last year as Trump maintains his desire to annex Greenland, a Danish territory and NATO ally. Europe relies heavily on U.S.-sourced LNG, though that could be in jeopardy due to growing fissures in the Western alliance.

Norway, another main supplier to the European market, reported December gas production averaged 13 Bcf/d, a 3.1% increase over government expectations.

By the Numbers

• 14 MTPA from LNG Canada
• 20 MTPA from Alaska LNG
• 2.1 MTPA from Woodfibre

Key Takeaways

• Canada is ahead of the game in western LNG deliveries.
• Trump emphasized Alaska in his pursuit of energy dominance.
• The LNG race is something of a geopolitical issue.

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About IIR News Intelligence
IIR News Intelligence is a trusted source of news for the industrial process and energy markets, powered by Industrial Info Resources' Global Market Intelligence (GMI).

About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).