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Mitsubishi takes stake in Kitimat LNG
Mitsubishi Corp. has signed a tentative agreement to take a minority stake in the Kitimat LNG project in northern British Columbia. The Japanese trading firm would also acquire about a third of the terminal capacity in the Heads of Agreement, a preliminary pact that’s the prelude to a contract, but no guarantee of one.
Mitsubishi, which has participated in Nikiski, Alaska, LNG exports since their inception in 1969, is a leader in the worldwide LNG trade, and handles nearly half of LNG imports to Japan, according to Kazuyuki Mori of the company.
Kitimat LNG Inc. and Mitsubishi are expecting to close the transaction by March 31. Under the deal, Mitsubishi would acquire terminal capacity for 1.5 million tonnes annually, out of the plant’s capacity of 5 million tonnes — equivalent to about 240 billion cubic feet a year. The companies didn’t say what equity stake Mitsubishi would take in the project, expected to cost C$4.2 billion.
More partners sought Kitimat LNG is still looking for more equity partners and others willing to commit to terminal capacity.
The company also announced Jan. 13 that it received Canadian federal government approval for the liquefaction terminal on Dec. 10, and provincial approval from British Columbia on Jan. 9.
The project near Prince Rupert was originally conceived as an import terminal, with the LNG to be regasified and then shipped to North American markets. But with a huge increase in unconventional gas resources on this continent, and a healthy appetite for LNG in Asia, it was reconfigured to export energy from western Canada instead.
If it’s completed, it would join the Nikiski plant as the only LNG export facilities in North America.
—Allen Baker
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