Cedar LNG, a partnership between the Haisla Nation and Canadian energy infrastructure player Pembina Pipeline Corporation, has secured a new multi-year agreement for its floating liquefied natural gas (LNG) (FLNG) facility located in the traditional territory of the Haisla Nation, on Canada’s West Coast.
Pembina has inked a 12-year agreement with Ovintiv , described as one of Canada’s largest natural gas producers, for 0.5 million tonnes per annum (mtpa) to complete the remarketing of its 1.5 mtpa of capacity at the Cedar LNG facility.
This deal is perceived to further demonstrate the Canadian energy infrastructure player’s commitment to delivering growth and executing its strategy within its long-standing financial guardrails and prudent risk profile.
Meghan Eilers , EVP of Midstream and Marketing at Ovintiv, commented: “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.”
Ovintiv has also confirmed the signing of the long-term agreement for 0.5 million tonnes per annum of the Canadian energy infrastructure firm’s liquefaction capacity at the project, which has a nameplate capacity of 3.3 million tonnes per annum.
The latest deal is said to enable the export of 0.5 mtpa of LNG, under which Pembina will provide transportation and liquefaction capacity to Ovintiv over a 12-year term, starting with commercial operations at Cedar LNG, anticipated in late 2028.
This provides the Canadian natural gas producer with access to additional export markets, complementary to the company’s existing portfolio of natural gas transportation arrangements. The export from the west coast of Canada is deemed to offer the shortest shipping distance to Asian LNG markets from North America.
Cedar LNG consists of the construction, commissioning, and operation of a new Indigenous majority-owned FLNG processing facility and marine export terminal in Kitimat, British Columbia.
This will be powered by clean hydroelectricity from B.C.’s grid and will produce ultra low-carbon LNG that has the potential to displace the use of higher-emitting forms of energy in Asia.
The 12-year agreement follows a 20-year deal with Petronas for 1 mtpa of Pembina’s liquefaction capacity at the Cedar LNG facility.