Canada Negotiates Cost to Make LNG Canada Expansion Greener
(Bloomberg)-Canada, Energy Minister Tim Hodgson is accelerating negotiations with investors behind the country’s largest liquefied natural gas export terminal for an expansion that doubles its size.
This may include some government support that both Hodgson and Prime Minister Mark Carney proposed in separate statements this week. Exactly the uncertainty which form to take, and Hodgson stressed that negotiations should remain special to get the agreement over the finish line.
The Canadians want exports to be “responsible for the environment ,, Hodgson said in an interview.
This includes a large amount of fossil fuel from the LNG Canada facility, which has a suggestion to expand the capacity on the northwest coast of British Columbia to 28 million metric tons a year.
“It costs money to do things correctly,” he said. “So, there are things that need to be negotiated to help fans reach their target returns.”
Carney announced on Thursday that LNG Canada Phase 2 was included in the first major infrastructure projects that the government plans to accelerate. The first stage of the facility started in June and the second stage has already needed title approvals. Shell Plc, Petronas, Petrochina Co., Mitsubishi Corp. and Korean Gas Corp.’s owners, who have a consortium, have not yet made a final investment decision.
In a statement to journalists on Thursday, Carney added federal incentives for the expansion of Megaproject, but added that they would be “very humble” compared to the total cost of capital.
Hodgson pointed out an area that requires extra cost to clean the expansion: bringing more electricity to the rugged view of BC. This would be expensive, but it would allow the plant to enter clean hydroelectricity instead of giving itself strength by burning more gas.
The Minister said that Canada has already built LNG plants in the world, “the most responsible for the environment” in the world. However, he said that electricity transmission is one of the costs to make LNG Canada even more clean. “There are ways to cope with this. Some are not costing money. Some of them cost money. Today we are going through these arguments with the advocate.”
LNG Canada is an investment of tens of billions of dollars and is one of the largest private sector projects in Canadian history. According to the data compiled by Bloomberg, the second stage is built and completely used, it makes Canada the sixth largest LNG export country based on 2024 figures. This is not considered another LNG export facility.
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