Petroliam Nasional Bhd (Petronas) is acquiring a 25% stake in a liquefied natural gas (LNG) project in Kitimat, Canada after it scrapped plans for the Pacific NorthWest LNG project in the country last July due to challenging market conditions as a result of prolonged depressed prices.
Petronas said in a statement that its wholly owned entity the North Montney LNG Ltd Partnership had entered into a purchase and sales agreement for the deal. The purchase sum was not disclosed.
Other shareholders of the project are Royal Dutch Shell plc’s subsidiary Shell Canada Energy (40%), PetroChina Canada Ltd (15%), Mitsubishi Corp’s subsidiary Diamond LNG Canada Ltd (15%) and Kogas Canada LNG Ltd (5%).
The transaction is subject to international regulatory approvals and the completion of other associated agreement. It is slated for completion in the next few months.
“Petronas is pleased to be part of the LNG Canada project. As one of the world’s largest LNG producers, Petronas looks forward to adding value to this venture through our long-term expertise and experience across the LNG value chain. We are committed to deliver LNG and natural gas, the cleanest fossil fuel in the world, to the growing global energy market,” said Petronas president and group CEO Tan Sri Wan Zulkiflee Wan Ariffin.
“Petronas is in Canada for the long-term and we are exploring a number of business opportunities that will allow us to increase our production and accelerate the monetisation of our world-class resources in the North Montney. LNG is just one of those opportunities,” he added.
The proposed 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 world-scale LNG processing units referred to as “trains”, with an option to expand the project in the future to four trains.
Canada is Petronas’ second largest resource holder after Malaysia, with vast unconventional gas and oil resources in the North Montney.
Petronas and its North Montney joint venture partners are one of the largest natural gas resource owners in Canada with over 52 trillion cubic feet of reserves and contingent resources.
