LNG
ByThe Canadian Press
February 01, 2026
Businessman Krishnan Suthanthiran poses for a photo in Calgary, Sunday, Jan. 18, 2026. Suthanthiran, who owns the one-time company town of Kitsault, B.C., is trying to interest government in the site as an energy export terminal. THE CANADIAN PRESS/Larry MacDougal (Larry MacDougal)
Krishnan Suthanthiran is trying to make Kitsault, B.C., happen — again.
The Indian-born, U.S.-based medical technology entrepreneur says he spent about US$7 million two decades ago to purchase the uninhabited one-time mining town at the end of a scenic fiord. Some media reports have cited a lower purchase price.
His early plans for Kitsault included an eco-resort, an arts and science centre and a movie studio. In 2013, Suthanthiran turned his sights to energy, floating a plan for a liquefied natural gas export terminal.
None of those ideas have panned out and the town, about 140 kilometres northeast of Prince Rupert, B.C., remains mostly vacant.
But Suthanthiran believes Kitsault’s time as an energy hub has finally come, as trade and geopolitical upheaval focus political attention on boosting oil and gas exports to non-U.S. markets.
His latest pitch is to build two pipelines connecting Alberta to the coast, one for natural gas and one for crude oil. The oil and natural gas, in the form of liquid butanol, would be exported across the Pacific from a marine terminal near Kitsault.
He came armed with a pile of glossy brochures touting Kitsault’s housing and infrastructure offerings late last month when he visited Calgary, where he said he had meetings with Alberta energy ministry staff.
“I truly believe that this is the right thing for Canada and this is the right thing for the First Nations,” the 78-year-old told The Canadian Press in an interview.
The town
Kitsault’s life as a bustling mining town was brief.
Amax Canada Development Ltd. opened a molybdenum mine nearby in 1981. The town it built for workers once boasted 1,200 residents.
But shortly thereafter, the market tanked for molybdenum, an ore used in steelmaking, and the mine shut down. By the end of 1983, Kitsault was empty. It has remained frozen in a 1980s time warp ever since.
When the town was put on the market in 2004, it came with 92 houses, complete with period decor. It also had a hospital with a never-used X-ray machine, a curling rink, swimming pool, library, theatre, shopping mall and pub. The Kitsault Energy brochure says the town has full B.C. Hydro power service.
Over the years, the town has only housed groundskeepers and a smattering of mining workers. Suthanthiran figures he spends $2 million a year to maintain it.
The businessman
A biography on Kitsault Energy’s website tells the story of Suthanthiran’s humble beginnings in India, where it says he sold candy to classmates so he could afford schoolbooks. The bio says he came to Canada in 1969 with $400 and studied engineering at Carleton University in Ottawa. Three years later, unable to find a suitable job in Canada, he moved to the U.S.
His father’s cancer death inspired his career path and he founded a family of companies under the TeamBest Global umbrella focused on equipment used in cancer diagnosis and treatment, the bio said.
Some have run into legal and labour trouble.
In one case dating back more than a decade, Belgian authorities sought Canada’s help executing search warrants related to a criminal investigation into Best Medical Belgium Inc., one of Suthanthiran’s companies. A 2017 Court of Appeal for Ontario decision says the Belgians were looking into allegations of misuse of company assets, concealing assets in insolvency, making false statements, using false documents and money laundering. Suthanthiran has denied wrongdoing. CBC reported last June that the investigation was ongoing.
Later, workers at another one of Suthanthiran’s companies, Best Theratronics in Ottawa, went on strike for almost 10 months amid a bitter pay dispute until an agreement was finally reached early last year. At the same facility, which made equipment used in radiation therapy, the company ran afoul of the Canadian Nuclear Safety Commission over the financial guarantee for decommissioning required under its licence.
When asked how his expertise figures into his oil and gas ambitions, Suthanthiran replied: “I’m an innovator, I’m an engineer.”
The plan
Suthanthiran wrote in an open letter to Prime Minister Mark Carney and Alberta Premier Danielle Smith last month outlining a vision to “elevate Canada’s role as a global energy leader.”
He is proposing a marine terminal at a deepwater port on Observatory Inlet, about 30 kilometres from the town site, from which tankers of crude would depart for Asia. He says the site would also have a floating facility to manufacture liquid butanol — a chemical with a wide range of uses, including as a fuel — from natural gas. Suthanthiran says it’s a more cost-effective undertaking than LNG, which requires gas to be chilled into a liquid in ultra-cold temperatures.
Along the same inlet, but closer to the Pacific, the Nisga’a Nation and industry partners are planning the floating Ksi Lisims LNG development, which is being expedited as a federal project of national importance.
Barry Prentice, a business professor at the University of Manitoba, said the waters leading to Kitsault are navigable and sheltered.
“From a marine perspective, I don’t see any red lights flashing,” said Prentice, who specializes in transport and supply chains.
The fact that the town is connected to utilities and already has housing available is a bonus, Prentice added.
“If the idea is to move fast on things, I can’t think of any site that would be able to move faster than that,” he said. “Some of the pieces of the puzzle are there.”
Heather Exner-Pirot, senior fellow at the Macdonald Laurier Institute, hadn’t heard of Kitsault as a port option.
“Prince Rupert comes up as a more obvious one, because they have the deep water ports and because they have capacity for the size of the operation that we’d expect,” she said.
Further south and inland, the port of Kitimat already has the LNG Canada terminal in operation and another, Cedar LNG, under construction.
“It is busy and probably constrained,” said Exner-Pirot.
The best bet, she said, is wherever the support from local First Nations is strongest.
“The most welcoming Indigenous nation on that coast would have a very good chance of attracting it.”
The moment
Suthanthiran believes the “stars are lined up” for his latest vision for Kitsault to succeed. The Canada-U.S. trade relationship has been rattled by tariff chaos and annexation threats. That’s honed political attention on boosting exports to markets besides the United States, by far the biggest buyer of Canadian oil and gas.
U.S. plans to boost Venezuelan oil production following the ouster of President Nicolas Maduro in January has intensified calls for Canada to ramp up energy exports to Asia via the West Coast.
The Alberta government is currently leading the charge for a new oilsands pipeline, committing $14 million to early work on a proposal to the federal major projects office, established last year to speed along infrastructure deemed in Canada’s national interest.
Smith has said the aim is for the private sector to eventually take on the project alongside First Nations partners. A sweeping energy agreement Smith and Carney signed late last year envisions a new bitumen pipeline being built in tandem with emissions-reducing measures.
Suthanthiran said Canadian industry remains “gun shy” about taking on such a project.
“Everybody is pointing a finger at somebody else. Who’s going to take the lead? It’s like a dance floor. Nobody wants to go first.”
Suthanthiran said he’s open to selling Kitsault and letting someone else take the reins.
“I don’t have to own the town forever.”
Lauren Krugel, The Canadian Press
Krishnan Suthanthiran is trying to make Kitsault, B.C., happen — again.
The Indian-born, U.S.-based medical technology entrepreneur says he spent about US$7 million two decades ago to purchase the uninhabited one-time mining town at the end of a scenic fiord. Some media reports have cited a lower purchase price.
His early plans for Kitsault included an eco-resort, an arts and science centre and a movie studio. In 2013, Suthanthiran turned his sights to energy, floating a plan for a liquefied natural gas export terminal.
None of those ideas have panned out and the town, about 140 kilometres northeast of Prince Rupert, B.C., remains mostly vacant.
But Suthanthiran believes Kitsault’s time as an energy hub has finally come, as trade and geopolitical upheaval focus political attention on boosting oil and gas exports to non-U.S. markets.
His latest pitch is to build two pipelines connecting Alberta to the coast, one for natural gas and one for crude oil. The oil and natural gas, in the form of liquid butanol, would be exported across the Pacific from a marine terminal near Kitsault.
He came armed with a pile of glossy brochures touting Kitsault’s housing and infrastructure offerings late last month when he visited Calgary, where he said he had meetings with Alberta energy ministry staff.
“I truly believe that this is the right thing for Canada and this is the right thing for the First Nations,” the 78-year-old told The Canadian Press in an interview.
The town
Kitsault’s life as a bustling mining town was brief.
Amax Canada Development Ltd. opened a molybdenum mine nearby in 1981. The town it built for workers once boasted 1,200 residents.
But shortly thereafter, the market tanked for molybdenum, an ore used in steelmaking, and the mine shut down. By the end of 1983, Kitsault was empty. It has remained frozen in a 1980s time warp ever since.
When the town was put on the market in 2004, it came with 92 houses, complete with period decor. It also had a hospital with a never-used X-ray machine, a curling rink, swimming pool, library, theatre, shopping mall and pub. The Kitsault Energy brochure says the town has full B.C. Hydro power service.
Over the years, the town has only housed groundskeepers and a smattering of mining workers. Suthanthiran figures he spends $2 million a year to maintain it.
The businessman
A biography on Kitsault Energy’s website tells the story of Suthanthiran’s humble beginnings in India, where it says he sold candy to classmates so he could afford schoolbooks. The bio says he came to Canada in 1969 with $400 and studied engineering at Carleton University in Ottawa. Three years later, unable to find a suitable job in Canada, he moved to the U.S.
His father’s cancer death inspired his career path and he founded a family of companies under the TeamBest Global umbrella focused on equipment used in cancer diagnosis and treatment, the bio said.
Some have run into legal and labour trouble.
In one case dating back more than a decade, Belgian authorities sought Canada’s help executing search warrants related to a criminal investigation into Best Medical Belgium Inc., one of Suthanthiran’s companies. A 2017 Court of Appeal for Ontario decision says the Belgians were looking into allegations of misuse of company assets, concealing assets in insolvency, making false statements, using false documents and money laundering. Suthanthiran has denied wrongdoing. CBC reported last June that the investigation was ongoing.
Later, workers at another one of Suthanthiran’s companies, Best Theratronics in Ottawa, went on strike for almost 10 months amid a bitter pay dispute until an agreement was finally reached early last year. At the same facility, which made equipment used in radiation therapy, the company ran afoul of the Canadian Nuclear Safety Commission over the financial guarantee for decommissioning required under its licence.
When asked how his expertise figures into his oil and gas ambitions, Suthanthiran replied: “I’m an innovator, I’m an engineer.”
The plan
Suthanthiran wrote in an open letter to Prime Minister Mark Carney and Alberta Premier Danielle Smith last month outlining a vision to “elevate Canada’s role as a global energy leader.”
He is proposing a marine terminal at a deepwater port on Observatory Inlet, about 30 kilometres from the town site, from which tankers of crude would depart for Asia. He says the site would also have a floating facility to manufacture liquid butanol — a chemical with a wide range of uses, including as a fuel — from natural gas. Suthanthiran says it’s a more cost-effective undertaking than LNG, which requires gas to be chilled into a liquid in ultra-cold temperatures.
Along the same inlet, but closer to the Pacific, the Nisga’a Nation and industry partners are planning the floating Ksi Lisims LNG development, which is being expedited as a federal project of national importance.
Barry Prentice, a business professor at the University of Manitoba, said the waters leading to Kitsault are navigable and sheltered.
“From a marine perspective, I don’t see any red lights flashing,” said Prentice, who specializes in transport and supply chains.
The fact that the town is connected to utilities and already has housing available is a bonus, Prentice added.
“If the idea is to move fast on things, I can’t think of any site that would be able to move faster than that,” he said. “Some of the pieces of the puzzle are there.”
Heather Exner-Pirot, senior fellow at the Macdonald Laurier Institute, hadn’t heard of Kitsault as a port option.
“Prince Rupert comes up as a more obvious one, because they have the deep water ports and because they have capacity for the size of the operation that we’d expect,” she said.
Further south and inland, the port of Kitimat already has the LNG Canada terminal in operation and another, Cedar LNG, under construction.
“It is busy and probably constrained,” said Exner-Pirot.
The best bet, she said, is wherever the support from local First Nations is strongest.
“The most welcoming Indigenous nation on that coast would have a very good chance of attracting it.”
The moment
Suthanthiran believes the “stars are lined up” for his latest vision for Kitsault to succeed. The Canada-U.S. trade relationship has been rattled by tariff chaos and annexation threats. That’s honed political attention on boosting exports to markets besides the United States, by far the biggest buyer of Canadian oil and gas.
U.S. plans to boost Venezuelan oil production following the ouster of President Nicolas Maduro in January has intensified calls for Canada to ramp up energy exports to Asia via the West Coast.
The Alberta government is currently leading the charge for a new oilsands pipeline, committing $14 million to early work on a proposal to the federal major projects office, established last year to speed along infrastructure deemed in Canada’s national interest.
Smith has said the aim is for the private sector to eventually take on the project alongside First Nations partners. A sweeping energy agreement Smith and Carney signed late last year envisions a new bitumen pipeline being built in tandem with emissions-reducing measures.
Suthanthiran said Canadian industry remains “gun shy” about taking on such a project.
“Everybody is pointing a finger at somebody else. Who’s going to take the lead? It’s like a dance floor. Nobody wants to go first.”
Suthanthiran said he’s open to selling Kitsault and letting someone else take the reins.
“I don’t have to own the town forever.”
Lauren Krugel, The Canadian Press
PM Carney, Alta. Premier Smith open to alternate oil pipeline routes
By Spencer Van Dyk
January 29, 2026
Alberta Premier Danielle Smith and Prime Minister Mark Carney both say they’re open to alternate routes for a potential pipeline to get Alberta oil to Asian markets, which does not necessarily need to end at B.C.’s northwest coast.
“Some of the alternatives are already emerging,” Smith told reporters in Ottawa on Thursday, when asked whether the northwest coast route is the only one being considered.
By Spencer Van Dyk
January 29, 2026
Alberta Premier Danielle Smith and Prime Minister Mark Carney both say they’re open to alternate routes for a potential pipeline to get Alberta oil to Asian markets, which does not necessarily need to end at B.C.’s northwest coast.
“Some of the alternatives are already emerging,” Smith told reporters in Ottawa on Thursday, when asked whether the northwest coast route is the only one being considered.
Prime Minister Mark Carney and Alberta Premier Danielle Smith both say they’re open to alternate routes for a potential pipeline to get Alberta oil to Asian markets, which does not necessarily need to end at B.C.’s northwest coast. (The Canadian Press combined photo)
She said several options to boost oil exports are currently being considered, including an expansion of Enbridge’s main line and exploring ways to better utilize old Keystone assets, among other ideas.
“North, south, east, west, we’re willing to go in every direction,” Smith said.
Smith has been at odds with B.C. Premier David Eby over the issue for months. In June, Eby said he wouldn’t support a new pipeline — arguing the Trans Mountain Expansion Project is already in place — to which Smith responded that she would “convince” him.
She said several options to boost oil exports are currently being considered, including an expansion of Enbridge’s main line and exploring ways to better utilize old Keystone assets, among other ideas.
“North, south, east, west, we’re willing to go in every direction,” Smith said.
Smith has been at odds with B.C. Premier David Eby over the issue for months. In June, Eby said he wouldn’t support a new pipeline — arguing the Trans Mountain Expansion Project is already in place — to which Smith responded that she would “convince” him.
Prime Minister Mark Carney, right, signs an MOU with Alberta Premier Danielle Smith in Calgary,Thursday, Nov. 27, 2025. THE CANADIAN PRESS/Jeff McIntosh
Then, in November, Carney and Smith signed a historic memorandum of understanding (MOU) outlining the conditions that need to be met for a new oil pipeline to the Pacific to proceed.
In the MOU, Alberta agreed to negotiate an industrial carbon pricing agreement by April 2026, which would implement an industrial carbon price with a floor of $130 per tonne.
In return, the federal government has agreed not to implement the oil and gas emissions cap, to suspend the clean electricity regulations in the province, and if required, make an exemption to the federal tanker ban.
But Eby has been staunchly opposed to lifting the tanker ban, which was enacted in 2019 and prohibits oil tankers carrying more than 12,500 metric tons of crude or persistent oil from docking, loading or unloading at ports on the B.C. north coast.
Then, in November, Carney and Smith signed a historic memorandum of understanding (MOU) outlining the conditions that need to be met for a new oil pipeline to the Pacific to proceed.
In the MOU, Alberta agreed to negotiate an industrial carbon pricing agreement by April 2026, which would implement an industrial carbon price with a floor of $130 per tonne.
In return, the federal government has agreed not to implement the oil and gas emissions cap, to suspend the clean electricity regulations in the province, and if required, make an exemption to the federal tanker ban.
But Eby has been staunchly opposed to lifting the tanker ban, which was enacted in 2019 and prohibits oil tankers carrying more than 12,500 metric tons of crude or persistent oil from docking, loading or unloading at ports on the B.C. north coast.
B.C. Premier David Eby, speaks during an announcement for new funding to support victims of crime, in Surrey, B.C. on Friday, Nov. 28, 2025. THE CANADIAN PRESS/Ethan Cairns
“We are doing our work to put the project together by June, and we are hoping that the federal government can move swiftly on making a decision so we can get down to technical details on that,” Smith said on Thursday.
“I’m very confident that once approved, we will have one or more strong proponents in the private sector willing to work with us to build it.”
Asked to respond, Eby said Smith is “committed to keeping (B.C.) updated on her progress,” and that he looks forward to that.
Canada’s premiers are in Ottawa this week for a meeting of the Council of the Federation. On Thursday, they also collectively sat down with Carney, largely to discuss trade amid the ongoing trade war with the United States.
While they’re in town, a few also met with Carney separately, including Smith and Eby, who said pipelines were a topic of conversation.
The B.C. premier described the sit-down as “very civil,” and “borderline friendly.”
“We are doing our work to put the project together by June, and we are hoping that the federal government can move swiftly on making a decision so we can get down to technical details on that,” Smith said on Thursday.
“I’m very confident that once approved, we will have one or more strong proponents in the private sector willing to work with us to build it.”
Asked to respond, Eby said Smith is “committed to keeping (B.C.) updated on her progress,” and that he looks forward to that.
Canada’s premiers are in Ottawa this week for a meeting of the Council of the Federation. On Thursday, they also collectively sat down with Carney, largely to discuss trade amid the ongoing trade war with the United States.
While they’re in town, a few also met with Carney separately, including Smith and Eby, who said pipelines were a topic of conversation.
The B.C. premier described the sit-down as “very civil,” and “borderline friendly.”
Prime Minister Mark Carney takes his seat at the First Ministers Meeting in Ottawa, Thursday, Jan. 29, 2026. (Adrian Wyld/The Canadian Press)
Speaking to reporters on Thursday, Carney said he wanted to “re-emphasize” that the MOU includes many other provisions, including cooperation on data centres, nuclear power, and inner ties.
“With respect to a route, and under the MOU, ‘a bitumen pipeline to Asian markets,’ is the way it’s described, and therefore the specific routes are not outlined,” Carney said.
“Of course, work is being done to explore the feasibility of various routes, and there are many factors that affect the feasibility, starting with Indigenous support, as well as technical and economic considerations,” he also said.
Alberta is currently acting as a proponent to fund the initial planning stages of a proposed bitumen pipeline to B.C. northwest coast, and Smith re-asserted her desire on Thursday to present a proposal to the Major Projects Office by June.
“We are hoping that the federal government can move swiftly on making a decision so we can get down to technical details on that,” Smith said. “I’m very confident that once approved, we will have one or more strong proponents in the private sector willing to work with us.”
A private proponent for a pipeline has yet to come forward.
With files from CTV News’ Stephanie Ha
Spencer Van Dyk
Writer & Producer, Ottawa News Bureau, CTV News
Speaking to reporters on Thursday, Carney said he wanted to “re-emphasize” that the MOU includes many other provisions, including cooperation on data centres, nuclear power, and inner ties.
“With respect to a route, and under the MOU, ‘a bitumen pipeline to Asian markets,’ is the way it’s described, and therefore the specific routes are not outlined,” Carney said.
“Of course, work is being done to explore the feasibility of various routes, and there are many factors that affect the feasibility, starting with Indigenous support, as well as technical and economic considerations,” he also said.
Alberta is currently acting as a proponent to fund the initial planning stages of a proposed bitumen pipeline to B.C. northwest coast, and Smith re-asserted her desire on Thursday to present a proposal to the Major Projects Office by June.
“We are hoping that the federal government can move swiftly on making a decision so we can get down to technical details on that,” Smith said. “I’m very confident that once approved, we will have one or more strong proponents in the private sector willing to work with us.”
A private proponent for a pipeline has yet to come forward.
With files from CTV News’ Stephanie Ha
Spencer Van Dyk
Writer & Producer, Ottawa News Bureau, CTV News
Shell, Mitsubishi exploring sale options for their stakes in LNG Canada: Reuters exclusive
By Reuters
January 16, 2026
Mitsubishi hires RBC
Mitsubishi, which holds a 15-per-cent stake, has hired RBC Capital Markets as it weighs its options, two of the sources said, cautioning deliberations were early and any sale effort would not kick off until later this year. The sources did not elaborate on how much of its stake Mitsubishi could market.
All the sources said sales involving Shell and Mitsubishi were not guaranteed, and spoke on condition of anonymity to discuss confidential deliberations.
CTV News reached out to LNG Canada, which referred questions to Shell and Mitsubishi. Shell said they would not be commenting on this story, while Mitsubishi has not responded.
MidOcean, backed by investment firm EIG and Saudi Aramco, closed a deal in December to buy a fifth of the Petronas venture that held a 25-per-cent stake in LNG Canada.
PetroChina holds a 15-per-cent stake, while Korea Gas Corporation owns five per cent of LNG Canada.
LNG Canada’s cost advantage
LNG Canada is the first major LNG facility in North America with direct access to the Pacific Coast. The project in Kitimat, B.C., has a supply cost advantage because prices for Canadian natural gas consistently trade at a discount to the U.S. Henry Hub benchmark.
Even so, existing and potential owners will consider industry fears of global oversupply of the supercooled fuel, as new LNG output comes online. Energy Transfer said in December that it was suspending development of its Lake Charles LNG export facility in Louisiana.
LNG Canada started production in June, but has since run into operational problems. Its second processing unit, known as Train 2, was down in December, nearly a month after its startup, two sources told Reuters
By Reuters
January 16, 2026
The Shell Oil logo and the logo of Mitsubishi Motors Corp in a combination photo. (AP Photo / Gene J. Puskar)
Oil company Shell and Japanese conglomerate Mitsubishi are exploring sale options for their respective stakes in the $40-billion LNG Canada project, three sources familiar with the matter told Reuters.
The moves come as owners of the massive liquefied natural gas facility weigh a potential expansion, and after another stakeholder, Petronas, successfully offloaded a piece of the project.
Shell, the largest owner with a 40-per-cent stake in LNG Canada, has been working with investment bankers at Rothschild & Co to sound out interested parties in recent weeks, said two of the sources. Two sources added that Shell could offload as much as three-quarters of its holding, or 30 per cent of the project.
Shell has expressed willingness, however, to consider different options relating to its exposure to the project’s Phase 1, which is operational, and the proposed Phase 2, given their different risks.
One of the sources estimated that any buyer for Shell’s stake could be committing roughly $20.9 billion, inclusive of the equity stake, debt and capital requirements for Phase 2.
Oil company Shell and Japanese conglomerate Mitsubishi are exploring sale options for their respective stakes in the $40-billion LNG Canada project, three sources familiar with the matter told Reuters.
The moves come as owners of the massive liquefied natural gas facility weigh a potential expansion, and after another stakeholder, Petronas, successfully offloaded a piece of the project.
Shell, the largest owner with a 40-per-cent stake in LNG Canada, has been working with investment bankers at Rothschild & Co to sound out interested parties in recent weeks, said two of the sources. Two sources added that Shell could offload as much as three-quarters of its holding, or 30 per cent of the project.
Shell has expressed willingness, however, to consider different options relating to its exposure to the project’s Phase 1, which is operational, and the proposed Phase 2, given their different risks.
One of the sources estimated that any buyer for Shell’s stake could be committing roughly $20.9 billion, inclusive of the equity stake, debt and capital requirements for Phase 2.
Royal Bank of Canada signage is pictured in the financial district in Toronto on September 8, 2023. THE CANADIAN PRESS/Andrew Lahodynskyj
Mitsubishi hires RBC
Mitsubishi, which holds a 15-per-cent stake, has hired RBC Capital Markets as it weighs its options, two of the sources said, cautioning deliberations were early and any sale effort would not kick off until later this year. The sources did not elaborate on how much of its stake Mitsubishi could market.
All the sources said sales involving Shell and Mitsubishi were not guaranteed, and spoke on condition of anonymity to discuss confidential deliberations.
CTV News reached out to LNG Canada, which referred questions to Shell and Mitsubishi. Shell said they would not be commenting on this story, while Mitsubishi has not responded.
MidOcean, backed by investment firm EIG and Saudi Aramco, closed a deal in December to buy a fifth of the Petronas venture that held a 25-per-cent stake in LNG Canada.
PetroChina holds a 15-per-cent stake, while Korea Gas Corporation owns five per cent of LNG Canada.
A tanker being loaded with the first cargo of Canadian liquefied natural gas is shown at the port of Kitimat, B.C. on Saturday June 28, 2025. THE CANADIAN PRESS/Handout — LNG Canada (Mandatory Credit)
LNG Canada’s cost advantage
LNG Canada is the first major LNG facility in North America with direct access to the Pacific Coast. The project in Kitimat, B.C., has a supply cost advantage because prices for Canadian natural gas consistently trade at a discount to the U.S. Henry Hub benchmark.
Even so, existing and potential owners will consider industry fears of global oversupply of the supercooled fuel, as new LNG output comes online. Energy Transfer said in December that it was suspending development of its Lake Charles LNG export facility in Louisiana.
LNG Canada started production in June, but has since run into operational problems. Its second processing unit, known as Train 2, was down in December, nearly a month after its startup, two sources told Reuters
.
The terminus for the Coastal GasLink natural gas pipeline is seen at the LNG Canada export terminal under construction in Kitimat, B.C., on Sept. 28, 2022. THE CANADIAN PRESS/Darryl Dyck
When fully ramped up, Phase 1 will have the capacity to export 14 million metric tons of LNG per year.
Shell told potential bidders it will keep a gas contract with the terminal for 30 years, one source said.
Developers of major infrastructure projects often reduce their stakes once they become operational, allowing them to book profits and recycle cash into new ventures. Large investment firms and infrastructure funds are ready buyers of such stakes, as they like the projects’ steady revenue.
Shell, the world’s biggest LNG trader, said in March it targeted a four-to-five per cent annual increase in LNG sales over the next five years and one-per-cent annual production growth.
Shell and its partners were working toward a final investment decision for Phase 2, as soon as this year, which would double capacity.
By Arathy Somasekhar, David French and Andres Gonzalez, Reuters
When fully ramped up, Phase 1 will have the capacity to export 14 million metric tons of LNG per year.
Shell told potential bidders it will keep a gas contract with the terminal for 30 years, one source said.
Developers of major infrastructure projects often reduce their stakes once they become operational, allowing them to book profits and recycle cash into new ventures. Large investment firms and infrastructure funds are ready buyers of such stakes, as they like the projects’ steady revenue.
Shell, the world’s biggest LNG trader, said in March it targeted a four-to-five per cent annual increase in LNG sales over the next five years and one-per-cent annual production growth.
Shell and its partners were working toward a final investment decision for Phase 2, as soon as this year, which would double capacity.
By Arathy Somasekhar, David French and Andres Gonzalez, Reuters
