Page 12 - Gi flipbook - November 2018

NEWS | INTERNATIONAL

CANADA
Shell approves $12bn liquefied

natural gas project in Canada

SHELL HAS APPROVED
a $12 billion (£9.3 billion)
investment in a mega
energy project to send
supercooled gas from
Canada to China and other
Asian countries as they turn
from coal to gas.
The scheme will be
Canada’s biggest ever
infrastructure project and
is the world’s first major
liquefied natural gas project
to be given the go-ahead
in five years. Shell has
a 40 per cent stake in
the $31 billion Canada
LNG joint venture, along
with Malaysian, Chinese,
Japanese and South Korean
energy firms.
The world’s appetite for
LNG, where gas is cooled
to -162C (-259.6F) so it can
be shipped in huge tankers,
had exceeded expectations
in the past year and made
the project viable, Shell
told The Guardian.
China is forecast to
massively increase its LNG CANADA
consumption of LNG Rendering of the LNG Canada site
as it looks to gas as a
solution to its air pollution immediately on the Canada travel via the Panama canal. around the world… We think
problems caused by coal project, with gas ready “Regardless of what we’ve adequately managed
power stations. to ship in the mid-2020s, others are doing, this is the that risk to date,” she said.
“We believe LNG Canada potentially as early as 2023, most competitive to be She said the scheme
is exactly the right project, according to some analysts. built,” Uhl said. would provide positive
in exactly the right place, Jessica Uhl, Shell’s Chief The scheme will be reliant cashflow for Shell even if
at exactly the right time,” Financial Officer, said: “We on a new 416-mile pipeline gas prices fell significantly.
said the company’s Chief believe the market needs being built to transport Industry watchers
Executive Ben van Beurden. more supply – and the gas from fields in northern welcomed the decision to
Shell is now the world’s timing of when this project British Columbia to the go ahead. “We sense that
leading trader of LNG, will come onstream sits coast, where it will be the risks from the Shell
thanks to its £47 billion nicely with the market processed and stored before perspective are lower than
acquisition of gas firm BG fundamentals.” being transferred to tankers. many in the market may
Group three years ago. The Anglo-Dutch firm Uhl said the company’s think,” said analysts at
But earlier this year, said the Canada LNG engagement with investment bank Barclays.
the company said an LNG project would be more First Nations and local Oil and gas analysts
supply crunch would occur competitive than rival US communities had been Wood Mackenzie said the
in the next decade because projects, because supplies truly unprecedented, and investment was a sign that
of a lack of new projects would reach Asian countries suggested she did not expect “mega projects are back” and
and rising demand, which it in 10 days rather than 24 the project to be delayed by it expected several other
expects to double by 2035. days for gas shipped from opposition. “Clearly there’s major LNG projects to get
Construction will begin the US Gulf, which has to been challenges on pipelines the go-ahead next year. ■

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News.indd 7 18/10/2018 13:13