CALGARY, A.B. – The Conference Board of Canada says there’s still room for optimism for Canada’s liquefied natural gas export industry, despite losses and global LNG prices that are expected to remain weak for at least the next three years.
The board says Canada’s natural gas industry is expected to post pre-tax losses of more than $1.6 billion this year after racking up losses of $1.7 billion in 2015, due to low natural gas prices throughout North America.
According to a report by economist Carlos Murilloo, investments in new LNG facilities around the world are expected to fall off in the next few years after about US$200 billion was spent in the past decade.
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Investments are expected to decline to US$4 billion per year by 2020, but global demand will continue to grow, according to a Conference Board report sparking a new round of spending on LNG facilities.
That’s good news for Canadian natural gas producers who have yet to see anyone commit to building an LNG export terminal in the country despite some 20 proposals.
Last month, Ottawa conditionally approved the $36-billion Pacific NorthWest LNG project but Petronas, the Malaysian state-owned oil firm proposing the project, says it must review the conditions before going ahead.