Petro-Canada opens door to Russian LNG; signs MOU with Gazprom
Gary Park
Petro-Canada has made its boldest foray yet in pursuing a global strategy of entering the liquefied natural gas sector by signing a tentative deal designed to ship LNG to North American markets by 2009.
The Calgary-based company said Oct. 12 that its Chief Executive Officer Ron Brenneman and Alexei Miller, CEO of Russia’s giant Gazprom, signed a memorandum of understanding that includes a cooperative study of liquefaction, regasification and supply-demand fundamentals. It also covers the potential for more cooperation in both Russia and North America on exploration and production, regasification and marketing, with the possibility of jointly developing a US$1.2 billion liquefaction plant near St. Petersburg (formerly Leningrad). Brenneman said this is “both the right time and the right opportunity to advance Petro-Canada’s presence in the full LNG value chain.
“The (MOU) is a critical first step in achieving a long-term business relationship with Gazprom in support of our growth strategy.”
Gazprom, which extracted 19 trillion cubic feet of gas in 2003 and has resources estimated at 918 tcf, has signed similar MOUs with ChevronTexaco and Norway’s Statoil that stop just short of a formal contract.
Petro-Canada has already teamed up with TransCanada to build a C$660 million LNG plant in northeastern Quebec that it hopes will provide 500 million cubic feet per day to U.S. and Canadian markets by 2009.
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