Royal Dutch Shell, with Asian-based partners, has bought a liquids import terminal in Kitimat from Cenovus Energy, fuelling speculation of a new liquid natural gas (LNG) port being built in the area.
Cenovus took over the 42,000-barrel-per-day Kitimat facility a year ago from methanol-production giant Methanex.
To date, three liquefied natural gas (LNG) proposals have targeted the Kitimat site as a potential exit point for Canadian natural gas.
Shell spokesman Stephen Doolan said the company and its partners Korea Gas Corp., Mitsubishi Corp. and China National Petroleum Corp. were "now exploring the potential for an [LNG] export terminal on the site."
Producers have been eager to tap into growing offshore demand for natural gas, which fetches more than triple the price in Asia than in North America.
The $5.6 billion Kitimat LNG project heralded by Apache Canada, EOG Canada and Encana has been approved for an export licence by federal regulators, setting it up to compete with or possibly partner with Shell, according to analysts.
Korea Gas, one of Shell's key partners in the venture, is the world's largest buyer of LNG. The state-run company has bought stakes in several Canadian shale gas fields, including a joint venture with Encana, acquiring supplies for South Korea.
from Western Investor December 2011
