LNG

The Ksi Lisims LNG Partnership, a development joint venture of the Nisga’a Nation, Rockies LNG and Western LNG LLC for a floating liquefaction and export plant near the port of Prince Rupert in British Columbia, has signed a 20-year sale and purchase agreement with the Shell subsidiary, Shell Eastern Trading.

Under the SPA, Shell will purchase 2 million tonnes of LNG per annum from the Ksi Lisims project on a free-on-board basis in what is the first LNG offtake agreement executed by the Ksi Lisims venture.

The Ksi Lisims FLNG platform will receive feed gas from the prolific shale-gas basin of northeast BC. The venture proposes to produce 12 MTPA at Wil Milit, located north of Prince Rupert and near the Nisga’a tribal village of Gingolx.

Ksi Lisims LNG’s governance structure provides each project proponent, the Nisga’a Nation, Rockies LNG and Western LNG, with input into project development, management and operations.

Innovative

“The Ksi Lisims LNG project is an innovative development for North America” said Davis Thames, President and CEO of Western.

The project will use a floating production units built by Samsung Heavy Industries and an all-electric process technology developed by Black & Veatch.

“The strong fundamentals of our project have earned the confidence of some of the most established companies in the LNG industry. We look forward to continuing to work with Shell and our other customers as we move toward reaching a final investment decision,” Thames stated.

“Ksi Lisims LNG will play an important role in the long-term economic growth of the Nisga’a Nation and other nations with which we work and we remain committed to being good partners with them,” he explained.

Thames noted that the work with the Nisga’a Nation and Rockies LNG had produced a “unique value proposition” for customers.

Steve Hill, Executive Vice President of Shell Energy, said that LNG was a critical pillar of global energy security and global demand is set to increase in the years to come.

Diverse portfolio

“We are pleased to sign this agreement with Ksi Lisims LNG which will help Shell to continue providing diverse and flexible LNG supply to its customers,” Hill stated.

Eva Clayton, president of the Nisga’a Lisims Government said her people had been striving to grow economic opportunities.

“Ksi Lisims LNG is the cornerstone of a brighter future for our people. As the project continues to pick up momentum, evidenced by this agreement with Shell, the Nisga’a people are now able to envision the opportunity and prosperity that Ksi Lisims LNG will bring,” Clayton declared.

Ksi Lisims LNG said it was represented by international law firm Baker Botts LLP in the drafting and negotiation of the SPA.

“We’re proud to be working to deliver the world’s cleanest natural gas to markets that need it most,” said Charlotte Raggett, President and CEO of Rockies LNG.

“Canada is an ideal global energy supplier, producing the world’s most responsible and lowest-emission natural gas at the shortest distance from Asia in the Americas,” she added.

Pembina Pipeline Corp., the developer of the Cedar floating LNG project in British Columbia along with the Haisla First Nation, has announced that President and Chief Executive Mick Dilger had stepped down.

The LNG Canada project, led by Royal Dutch Shell and the largest private sector investment in Canada's history, has announced that construction is more than 50 percent completed.

“There’s a popular saying: ‘Believe you can and you’re halfway there’,” said the LNG Canada consortium in a statement.

Construction began three years ago at the British Columbia liquefaction and export plant site at Kitimat, 640 kilometres north of Vancouver.

Shell and its four partners, Mitsubishi Corp. of Japan, Malaysian energy company Petronas, Chinese major PetroChina and Korea Gas Corp., agreed in October 2018 to invest C$40 billion (US$30.2Bln) on the brownfield site that had been an energy products terminal before being acquired by Shell in 2011.

The initial two Trains will produce 14 million tonnes per annum of LNG. There is the possibility of expanding the facility to include up to four processing units in the future.

The engineering, procurement and construction contractors are JGC Corp of Japan and Fluor Corp. of the US.

Among the plant innovations are energy-efficient natural gas turbines and renewable electricity from local utility BC Hydro, meaning the plant will emit less than half the greenhouse-gas emissions of the average LNG facility currently in operation.

In addition to the construction costs of the plant, a US$5-billion pipeline of 670km is being built by Canada's TC Energy to bring the feed-gas from the Montney natural gas basin to the Kitimat liquefaction and export facility on the Pacific Coast.

LNG Canada said it believes it can “set the benchmark” for economically, environmentally and socially responsible LNG development.

Objectives

“Believing we can achieve our goals and objectives gave us a great start. And now, quite literally, we are halfway there, a little more, in fact,” added the statement.

“Three years after our joint venture participants reached a successful final investment decision, we’re moving swiftly towards commissioning and start-up, and to fulfilling our promise of delivering a world-class LNG facility in Kitimat, in the traditional territory of the Haisla Nation, benefitting British Columbians and Canadians for decades to come,” declared LNG Canada.

However, LNG Canada again mentioned an ongoing dispute with the pipeline construction company TC Energy.

“It hasn’t always been easy. The Covid-19 pandemic has created challenges for everyone, at home and abroad. And we remain very concerned about cost and schedules increases disclosed by TC Energy to complete its Coastal GasLink pipeline that will connect to our facility,” explained LNG Canada.

“But with support from First Nations, local communities and businesses, and working with all levels of government, LNG Canada has continued to reach major milestones, safely and on schedule,” it added.

The company said the plant site has seen an LNG tank roof-raising and the arrival of its main cryogenic heat exchanger and two pre-cooler units.

“This was our first opportunity to receive critical infrastructure at our new material offloading facility,” said the company.

LNG Canada said that to date its contractors and sub-contractors have awarded C$3.5Bln in contracts and procurement to business in BC.

Of this amount, over C$2.7Bln has been awarded to First Nations-owned businesses and local area businesses.

“Thousands of Canadians, most of them from BC, are presently working on the LNG Canada project,” the company noted.

In the coming weeks and months, activities will increase as more critical infrastructure arrives.

“The transformation of our site in Kitimat will accelerate as we move through the next stages of project completion and ever closer to shipping our first cargo of low-carbon, made-in-BC LNG,” the company declared.

The British Columbia LNG Alliance has become the Canadian LNG Alliance to reflect the critical role of the fuel in national economic recovery, boosting industry opportunities for Indigenous communities and leading Canada's clean energy transition.

TC Energy will close the sale of a majority stake in the Coastal GasLink Pipeline to two equity funds by June and will also offer 20 Canadian First Nations a 10 percent share of the project to bring feed-gas for LNG processing on the Pacific Coast of British Columbia.