MOSCOW (MRC) -- A Canadian energy company has reached a deal with major German utility E.ON to export liquefied natural gas from a proposed plant on the Atlantic coast of Canada, according to Hydrocarbonprocessing.
The multi-billion dollar project is one of several planned LNG terminal projects designed to export a glut of North American natural gas, which has depressed prices on the continent but made the gas more attractive to overseas buyers.
A handful of big and small energy producers are scrambling to line up approvals, financing and customers for a number of gas export projects in both Canada and the US.
In the deal announced Monday, Pieridae Energy (Canada) Ltd. said it plans to ship about 5 million tpy of LNG to Western Europe from a LNG plant it plans to build in Goldboro, Nova Scotia on Canada's Atlantic coast. The exact financial terms weren't disclosed, but E.ON said the contract is worth several billion euros per year.
It marks the first contract for a Canadian LNG export plant with a major end-user of gas, something that has so far eluded several proposed liquefaction facilities envisioned for Canada's Pacific coast, which are geared toward Asian markets.
Pieridae said LNG shipments would start by the first quarter of 2020, subject to clearing an environmental assessment in Nova Scotia. The plant will handle a yearly volume of around 10 million tons of LNG, which will be pumped onto ships for export.
E.ON's commitment is viewed as an anchor deal that may help Pieridae convince other buyers to contract for its still-untested supplies of LNG. For E.ON, LNG from North American allows it to diversify its gas supply, which is now concentrated on deliveries from Russia.
As MRC reported earlier, a small British Columbia natural gas export project has moved closer to selling Canadian energy to Asia after a pair of international investors agreed to help backstop the USD485 million project. Bermuda-based Golar LNG had already committed some of its LNG vessels to BCLNG, the pint-sized export facility backed in part by the Haisla First Nation near Kitimat, BC Now Golar, alongside an unnamed Asian firm, has agreed to partner in the project, with Golar taking a 25% ownership stake in a facility that stands to be the first in Canada to send natural gas across the Pacific. The partners have also agreed to assist with financing for the Haisla, who hold a 27.5% stake in the bid to export 600,000 to 700,000 tonnes per year of LNG.
Besides, in February, 2013, Canada's National Energy Board approved a liquefied natural gas export license for Royal Dutch Shell Plc's planned LNG export plant on British Columbia's Pacific Coast. The regulator approved exports of up to 670 million tonnes of LNG over the 25-year period covered by the license, or 3.23 billion cubic feet of gas per day. The license was given to LNG Canada Development Inc, a Shell-led consortium that includes Mitsubishi Corp, PetroChina and Korea Gas Corp.
MRC