Canada’s National Energy Board has issued a 20-year license to KM LNG Operating General Partnership to export LNG from Kitimat, BC, to Asia-Pacific markets.
The license authorizes KM LNG to export a maximum quantity of 10 million tonnes/year, equivalent to 468 bcf/year, or 9,360 bcf over 20 years.
Western Canada Sedimentary Basin producers will supply the gas, which would reach Kitimat via the Pacific Trail Pipeline. It would be liquefied at a terminal to be built at Bish Cove, near Kitimat. Construction and operation of the pipeline and the terminal will require provincial regulatory decisions, NEB noted.
This is the first application for an LNG export license that NEB has considered since deregulation of the natural gas market in 1985.
The board said it had satisfied itself that the quantity of gas to be exported does not exceed the amount required to meet foreseeable Canadian demand. The exported LNG will open new markets for Canadian gas production, and ongoing development of shale gas resources will ultimately further increase the availability of natural gas for Canadians, the board reasoned.
The board considered environmental and related socioeconomic effects of KM LNG’s application. These effects included matters related to marine shipping and the proposed LNG terminal and Pacific Trail Pipeline.
The board also acknowledged the potential economic benefits associated with KM LNG’s project. These benefits include employment opportunities due to the development of the LNG terminal and the Pacific Trail pipeline.