Partners announce $31bn Canada LNG project gets go ahead

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Instead, Shell said in a statement that each of the partners in LNG Canada would be responsible for providing their share of the natural gas to be liquefied, and would also be in charge of marketing the output of the super-chilled fuel.

LNG Canada is a joint venture of five partners - Royal Dutch Shell Plc, PetroChina Co.

What is the difference between the LNG natural gas project and the Trans Mountain pipeline twinning?

"Record demand will be driven by the longer-term shift to natural gas in the electric and industrial sectors resulting from natural gas' competitive prices and environmental benefits".

Petronas said the project is operated through LNG Canada Development Inc.

Canada is committing US$ 200m in federal support to the LNG Canada project for infrastructure and marine and environmental protection.

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LNG Canada's partners are probably betting that LNG demand will grow substantially, and even if its doesn't, they will be fine because they have first-mover advantage in what may be another wave of new projects.

"We believe this project has the potential to be the first of many on the West Coast of Canada, if Canadian LNG follows the global standard, being that LNG export areas tend to be "hubs" of terminals, rather than standalone facilities", National Bank of Canada analysts said Tuesday in a report.

He said a significant portion of the LNG Canada investment will be spent on a plant manufactured overseas, with steel sourced from other countries.

The announcement was immediately cheered by the energy industry and decried by the B.C. Green Party, which is part of the coalition supporting the NDP government.

"We can't build energy projects like we did in the old days, where the environment and the economy were seen as opposing forces", said Trudeau.

"LNG exports and exports to Mexico by pipeline are projected to grow substantially, with LNG exports bringing the environmental benefits of our low carbon emissions to overseas customers, while providing jobs, economic benefits and stability to the US market", Jenkins said.

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"We've taken the first FID for a British Columbia LNG project to show the Prime Minister that it can be done in Premier Horgan's province", Calitz said.

That comes just weeks after Qatar, the world's top LNG exporter, said it would expand its already huge annual output of 77 million tonnes to 110 million tonnes in the coming years.

Getting the LNG project off the ground could be considered a win for the Trudeau government, which has struggled to get major energy projects built in Canada.

It is the biggest project sanction since the Tengiz expansion in Kazakhstan was approved in 2016 and the biggest greenfield project to be approved since Russia's Yamal LNG scheme in 2013.

Global natural gas demand is expected to increase 45 per cent to 199 trillion cubic feet per day by 2040, according to the Canadian Association of Petroleum Producers, which welcomed news that Canada will be able to export to customers other than those in the United States.

The LNG deal is "blueprint about cooperation and collaboration", Moore said.

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