Pembina is about to make the final investment decision on a $4-billion LNG project in British Columbia, Bloomberg has reported, citing unnamed sources close to the company.
The Cedar LNG project will use funding from at least 15 banks, according to the report. That's despite a push from climate activists for banks to stop funding energy projects that involve hydrocarbons.
If it materializes, the Cedar LNG facility, with a capacity of 3 million tons annually, will be the second Canadian LNG export project after LNG Canada which is led by Shell.
The Cedar LNG project is notable in the fact that one of the partners of Pembina in the project is the Haisla First Nation, which is really enthusiastic about the project. The enthusiasm follows the benefits that the community has seen from the LNG Canada project-chiefly in higher employment and, consequently, increased revenues.
The Haisla First Nation has also negotiated natural gas supply via the Coastal GasLink, which was built to feed natural gas to LNG Canada, for the Cedar LNG facility. The project will be powered with electricity produced from hydropower plants, making it one of the lowest-emission LNG facilities, according to its operators.
The news about the Cedar LNG final investment decision comes despite the fact that Canada's federal government does not consider the idea of LNG exports a priority in its energy agenda. In fact, earlier this year, Ottawa made this quite clear, with Energy and Natural Resources Minister Jonathan Wilkinson saying the country was not interested in investing in any LNG projects or subsidizing such plans.
"The government is opposed to using government money to fund inefficient fossil fuel subsidies. We're the first country in the world to actually do that," Wilkinson told CTV.
"We are not interested in investing in LNG facilities. That's the role of the private sector. They need to assess the business case and make the investments," Wilkinson noted.
It seems the private sector has assessed the business case and found it to be present for as many as two LNG export projects.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More