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LNG Canada CEO says FID not affected by Trans Mountain debacle or NAFTA negotiations

VANCOUVER, B.C. – The CEO of LNG Canada says that a final investment decision for the joint venture’s proposed $40 billion liquified natural gas export terminal won’t be affected by either the nationalization of the Trans Mountain pipeline or trade tensions with the U.S.

LNG Canada CEO Andy Calitz spoke with Bloomberg News from Vancouver last week, saying that the overall conditions for Royal Dutch Shell to make a positive final investment decision are good.

“That is, and feels, so very different to 2016 when the project was delayed,” said Calitz.

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LNG Canada, which is a joint venture led by Shell and includes Mitsubishi, Petronas, PetroChina Co., and Korea Gas Corp. as partners, delayed making an FID twice that year.

Calitz said that since then, the project has become more competitive, reducing the price at which a unit of gas can be delivered to Asia by 6 percent.

In the meantime, Shell released a report last winter which shows that global LNG demand is increasing, particularly from China and other Asian nations.

“The Trans Mountain decision, impactful as it has been in Canada on the regulatory scene, has not in any way stopped the LNG Canada project, which is ongoing,” Calitz said.

LNG Canada has sought an exemption from import tariffs on the approximately 140 steel modules for the project that need to be built in China.

The Federal Court of Appeal – which is the same court that quashed Trans Mountain’s approval – is expected to issue a decision by the end of the month.

Calitz also cautioned that an FID isn’t a foregone conclusion, as each of the LNG Canada joint venture partners has at least four or five competing projects where they could spend money instead.

The five joint venture partners are set to decide whether to build the complex by the end of this year.

Story courtesy Bloomberg News: https://www.bloomberg.com/news/articles/2018-09-21/mega-lng-project-unaffected-by-pipeline-debacle-its-ceo-says

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