Canada’s $4B Floating LNG Scheme Secures 12-Year Export Deal

(Credit: Cedar LNG)

Cedar LNG, the partnership between Haisla Nation and Pembina Pipeline Corporation, has secured a 12-year agreement with Ovintiv for its floating liquefied natural gas (FLNG) facility, being developed on Canada’s West Coast.

The agreement, signed by Ovintiv and a subsidiary of Pembina Pipeline Corporation, enables the export of 0.5 mtpa of LNG, under which Pembina will provide transportation and liquefaction capacity to Ovintiv over a 12-year term.

The deal is set to start with the commercial operations at Cedar LNG, anticipated in late 2028.

It provides Ovintiv, one of Canada's largest natural gas producers, with access to additional export markets, complementary to the Company's existing portfolio of natural gas transportation arrangements.

According to Ovintiv, export from the west coast of Canada offers the shortest shipping distance to Asian LNG markets from North America.

"Today's announcement marks a significant advancement in our strategy to expand market access and maximize the profitability of our Montney gas resource through participation in global LNG markets.

"We are excited to partner with Pembina to supply low-cost Canadian natural gas to overseas markets, supporting energy security and global emissions reductions,” said Meghan Eilers, EVP of Midstream and Marketing at Ovintiv.

Cedar LNG facility has a nameplate capacity of 3.3 million tonnes per annum (mtpa). It is located in the traditional territory of the Haisla Nation.

The developers made final investment decision (FID) for the project in late June 2024.

Under a long-term transportation agreement with Coastal GasLink Pipeline Limited Partnership, the Cedar LNG facility will receive 400 million cubic feet per day of Canadian natural gas via the Coastal GasLink pipeline.

Cedar LNG also secured 20-year take-or-pay liquefaction tolling services agreements with ARC Resources and Pembina for 1.5 mtpa each.

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