NewsMay 15, 2012

Global energy firms announce LNG Canada, consultation begins with First Nations and local communities

Vancouver, British Columbia – Shell Canada Limited, Korea Gas Corporation (KOGAS), Mitsubishi Corporation, and PetroChina Company Limited today announced they are jointly developing a proposed liquefied natural gas (LNG) export facility near Kitimat, British Columbia. The LNG Canada project (www.LNGCanada.ca) brings together the four companies' technical depth, financial strength and access to markets required to be the leading LNG developer in Canada. LNG Canada would connect the abundant supply of Canadian natural gas to growing markets around the world. This also begins the formal consultation process with First Nations and local community residents regarding the project.

Shell holds a 40-percent working interest, with KOGAS, Mitsubishi and PetroChina each holding a 20- percent working interest. "Our combined expertise, and our focus on technological innovation in delivering safe and environmentally sound LNG projects around the globe, ensures that our LNG Canada project would be well-suited to deliver long-term value for British Columbia and increase access to new export markets for Canada," Jose-Alberto Lima, Vice President LNG Americas, Shell Energy Resources Company.

The proposed LNG Canada project includes the design, construction and operation of a gas liquefaction plant and facilities for the storage and export of liquefied natural gas (LNG), including marine off-loading facilities and shipping. LNG Canada can create significant economic benefit for the province, First Nations, local communities and the region. Such a project can create thousands of jobs during construction and hundreds of full-time, permanent jobs during operations. Such a significant energy project can also bring indirect economic development opportunities to the region.

A decision to move this project into development would be taken after conducting necessary engineering, environmental and stakeholder engagement work with start up around the end of the decade, pending regulatory approvals and investment decisions.

"As the World’s largest LNG buyer and operator of LNG terminals, we recognize the potential value of the LNG Canada project for our company and for British Columbia, and we look forward to conducting business in B.C., with respect for all local residents and their traditions," said Mr. Young Sik Kwon, Vice President of Korea Gas Corporation.

LNG Canada will initially consist of two LNG processing units referred to as "trains," each with the capacity to produce six million tonnes of LNG annually, with an option to expand the project in the future.

"We have a history of working with our joint-venture partners, as well as conducting business in Canada, said Junichi Iseda, Senior Vice President, Mitsubishi Corporation. We look forward to continuing to invest in Canada through this project, creating economic growth and new, important trade links between our two nations."

The demand for natural gas, the cleanest burning fossil fuel, remains high in Asia and other markets. LNG Canada would deliver a project that offers a new source of LNG to global markets, while providing benefits to Canada, British Columbia and its coastal region.

"This project will contribute to a further strengthening of trade relationships between China and Canada and will help China use clean burning natural gas to fuel its economic growth," said Bo Qiliang, Vice President, PetroChina Company Limited.

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