First cargo at LNG Canada is slated to set sail in mid-2025, opening up an additional avenue for North American LNG exports to the global market.

Located in Kitimat, British Columbia, in the traditional territory of the Haisla Nation, LNG Canada is the largest energy investment in Canadian history and will tap into an abundance of low-cost Canadian natural gas.

LNG Canada is a long-life asset with 40-year export licenses for the initial export of up to 14 million tonnes per annum (mtpa) through two trains.

The facility will provide lower carbon LNG to the world, including Asia, where demand is expected to grow well into the middle of the century. In China, it will be used to generate power with up to 55% less carbon emissions than coal, according to Shell.

The project partners companies with significant experience in the LNG space—Shell, Petronas, PetroChina, Mitsubishi and Korea Gas Co. (KOGAS).

LNG Canada’s Vice President of Corporate Relations Teresa Waddington spoke with Hart Energy International Managing Editor Pietro D. Pitts at Gastech Houston 2024 to discuss the liquefaction export facility project’s impact on Canada.

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Pietro Pitts, international editor, Hart Energy: Just how important is the start of LNG Canada for Canada as a country and Canadian gas producers?

Teresa Waddington, vice president of corporate relations, LNG Canada: This is a moment in history because it really is the very first LNG export project [for Canada]. Currently, 100% of Canada's gas is exported to the [U.S.], the only place that we have pipeline connections to. And from there it can reach international markets through some of their LNG terminals. For Canada, it's a big moment.

Our five joint venture partners are: Shell (40%), Petronas (25%), Mitsubishi (15%), PetroChina (15%) and KOGAS (5%). They own all of the gas coming through the facility and they’ll [soon] have access to liquefaction and international trade that was not a possibility from Canada before this.

PP: Again, LNG Canada will include two phases, right?

TW: LNG Canada Phase 1 has two 7 mtpa trains [Train 1 and Train 2], while Phase 2—which we haven't made a decision on yet, we don't have timing on—is for Train 3 and Train 4. So, each phase of LNG Canada adds 14 mtpa.

PP: Is the first cargo still set to sail in mid-2025 and then how much lag time will there be between the starts of Train 1 and Train 2?

TW: Yes, we expect our first cargo by mid-2025 and then when we ramp up to full production. It'll be a cargo every other day. [Regarding the start of Train 2], it’ll depend on the commission process and how it goes. We don’t have a timeline yet for our commissioning sequence.

PP: Could you be more specific on a start-up date and when full production might be reached?

TW: We'll see what happens. Thankfully we do have hydrocarbons in now and that went very smoothly. But, it's a huge facility, with some 215 modules that came together. It's going to be led by the safety and the quality focus, and we'll get gas when we get gas.

PP: Is it possible that, after the start of LNG Canada, that Canadian producers turn more attention to feeding your plant and less on plants on the U.S. Gulf Coast?

TW: I mean that's really our joint venture partners [JVP] who are the ones looking at that. They have the upstream [assets], so we don't source gas…we don't talk directly to producers. We're just relying upon our JVPs to send us their gas and we refrigerate it down to ship it.

PP: Has there been an uptick in interest in your project as you get closer to the commercial operations date?

TW: I don't think we can overstate how excited the Asian market is for LNG Canada. I went on two trade missions earlier this year to Korea and to Malaysia and my takeaway is it's really easy to sell LNG in Asia. Japan, especially, has a really strong drive to start to diversify its supply. And I think that they're hugely excited about when they start to ship cargos. And we've seen that in how they've spoken to us in their conversations with government officials. They're really looking forward to it.

PP: How does LNG Canada view the potential for change in Canada’s political environment? Is political uncertainty something you worry about?

TW: If you look at LNG Canada or a project of this scale, we're going to be in operations for 40 years. This is a multi-generational workforce kind of a project. So, we're not overly concerned about governments changing out or staying the same. Whatever happens in this upcoming election, it's really the policies and procedures and the agreements that we have in order to build our facility; the regulatory process, for instance, still stands. So, we're not overly concerned about it either way. It'll be what it'll be, and we will happily work with anybody who comes in.

PP: What’s your view on countries diversifying their supply sources?

TW: I think diversity of supply is the only way you can really protect [against supply disruptions]. And I think one of the reasons we've had so much enthusiasm for LNG Canada is because of the fact that we offer a previously un-existing option within the marketplace.

PP: How have discussions gone between LNG Canada and the indigenous peoples of Canada? Is LNG Canada actively engaged with them and if so, do you think the risks of community disapproval of the project are reduced?

TW: LNG Canada is built on the traditional territory of the Haisla Nation, and we have seven First Nations total within our project zone as well as the district of Kitimat. We often say that we built relationships before we built the project. We've really used that concept of being informed … alongside the values and the drivers of the communities. We enjoy a remarkable relationship with the Haisla and with the other nations within our project zone, where we really do have a two-way conversation going at all times.

And I can use the example [of] when we knew we would be flaring as part of our startup process. We had an extensive consultation with the communities and when we actually lit that first flare we got a lot of questions and comments from them that were more of the nature of: ‘I see you're finally making that step, we're really excited to see that.’ And I think that kind of comment just shows a different level of communication and understanding. Now, it's never perfect, it's never totally easy. But I would say that we've continued to have a really open dialogue about what they're experiencing, what they need from this project and what they need to see from us as an operating asset. And that's really served us well. I can't predict what will happen next, but I'd say at this point we have a strong basis to keep working forward.

PP: How does the extreme cold in Canada impact gas flows into LNG Canada, if anything, and/or liquefaction operations in the coldest months of the year?

TW: I'd say that we've got the benefit of most of our workforce being local. They know the weather. They grew up with that weather and LNG plants are actually wildly more efficient in the cold. One of the reasons that we're one of the lowest emissions intensity LNG facilities in the world is because cold helps. It actually keeps your processes running smoother and more efficiently. When you're trying to cool something, it helps if it's below freezing outside as opposed to [warmer temperatures].

Additionally, it makes [LNG Canada] more competitive than U.S. Gulf Coast projects where it's much warmer as we need to use less energy in the process.

PP: Again, in terms of emissions, what should we expect from LNG Canada?

TW: LNG Canada is going to be the lowest emission greenhouse-gas facility of its scale anywhere in the world: 35% lower than the next best facility and 60% lower than the average, which is pretty impressive.

And that's due to three primary things. One is our location in a nice cold place. The second one is the use of an innovative turbine, an aeroderivative turbine that liquefies the LNG. And the third is because we use BC Hydro, which is a hydroelectric utility for our utility power [to come through a combination of energy efficient natural gas turbines and renewable electricity.]

PP: What’s your take in general on continued growth in gas demand in the future and obviously the importance of gas in the energy matrix of tomorrow?

TW: The term energy addition was recently used by Shell Integrated Gas & Upstream Director Zoë Yujnovich during Gastech Houston 2024 instead of energy transition. And I think that really resonated. So, when you look at LNG and where it's going to fit in the global energy mix going forward, I do believe that it will continue to be a fuel that starts to allow developing nations in particular, the chance to continue to develop. I do believe it'll continue to be used to displace things like coal, which has not just a higher emissions intensity, but real impacts on air quality and health in the communities where its used extensively.

And as we see the Asian market in particular, China and India continue to grow in their energy usage as their populations start to get progressively improving quality of life. And LNG is going to be a cornerstone of that energy transition and energy addition. Again, after my trade missions to Korea, one of the things that I really took away from them was their definition of energy transition moving to LNG. So, it includes a lot of decarbonization options and it looks at solar and wind as well. But they've really said the transition to LNG is energy transition. And I realize that there's no uniform definition of what it is, but I think that's an interesting insight into how big a role it's going to play going forward, especially in the Asian market.

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