Pacific NorthWest LNG seeks export licence for B.C. project

Pacific NorthWest LNG said Friday that it has applied for a licence from the National Energy Board to export liquefied natural gas from the $25-billion facility the company's Malaysian owner Petronas is hoping to build off the coast of northwestern B.C.

Applies for licence to export liquefied natural gas from Port Edward, B.C., terminal

Petronas, a state-owned oil and gas company from Malaysia, where it operates liquefied natural gas facilities like the one above in Bintulu, wants to build a large LNG project off the coast of northwestern B.C. that would liquefy and export about 18 million tonnes of gas a year produced by Calgary-based Progress Energy Canada. (Stringer/Reuters)

Pacific NorthWest LNG said on Friday that it has applied for a licence from the National Energy Board to export liquefied natural gas from the $25-billion facility it is hoping to build off the coast of northwestern B.C.

Pacific NorthWest LNG, which is owned through various subsidiaries by the Malaysian oil and gas company Petronas, plans to build three so-called trains, the cooling units where the liquefication of gas occurs, on Lelu Island in the Port Edward district south of Prince Rupert.

The site will be used to liquefy and export natural gas produced by Calgary-based Progress Energy Canada, which was bought by Petronas last year in a $6-billion friendly deal.

The trains will eventually produce six million tonnes of LNG per year each for about 25 years, with a total capcity of 19.68 million tonnes a year when all trains are functioning at 100 per cent, which is rarely the case.

Environmental assessment still to come

Petronas has said it will invest between $9 billion and $11 billion to construct the first two liquefication units, and another $5 billion will be spent on a 750 kilometre-long pipeline, to be built by TransCanada Corp., that will supply gas to the two units. 

It hopes to get the project off the ground by the end of 2018, but it must first undergo an environmental assessment. The company said it hopes to submit its application to the Canadian Environmental Assessment Agency by the end of the year in order to start that process.

Obtaining an export permit is separate from the environmental assessment but necessary since Pacific NorthWest LNG plans to export all of the LNG produced at the site.

Most of the liquefied gas will be heading to Asia where Petronas has a broad customer base. Japan Petroleum Exploration Co., or Japex, has agreed to buy 10 per cent of the product from the new facility in a joint venture agreement announced in May. At the time, the company said it would be getting about 1.2 million tonnes of LNG a year from the project.

Pacific NorthWest LNG said the project will create up to 3,500 jobs during construction and 200 to 300 permanent, full-time jobs once it's operational and will benefit the First Nations who live and own land in the Prince Rupert area.

"We believe the successful completion of our project will create long-term, multi-generational benefits for First Nations, northwest BC, the province and the country as a whole," said Pacific NorthWest LNG president Greg Kist.