Indonesian Tycoon’s Firm to Spend $500 Million on Canada LNG
(Bloomberg) -- An energy company backed by Indonesian tycoon Sukanto Tanoto plans to spend $500 million this year on a long-planned liquefied natural gas project in Canada, the clearest signal yet that it may move ahead with an LNG export facility on the country’s west coast.
Woodfibre LNG, backed by Tanoto’s Pacific Energy Corp., has yet to formally announce an investment decision. But Woodfibre President Christine Kennedy gave the spending details to local government officials in Squamish, British Columbia, on Tuesday. The $500 million figure is 31% of the expected $1.6 billion total cost of the project.
A copy of Kennedy’s presentation was obtained by Bloomberg. “While we have not yet issued our final notice to proceed, this confirmed investment is indicative of our intent to start pre-construction work this year, and complete this critical low-emission energy project in 2027,” Kennedy said in an emailed statement.
Woodfibre’s plan follows Shell Plc’s decision to build the much-larger C$40 billion ($31.8 billion) LNG Canada project in Kitimat, British Columbia, which is 60% complete and scheduled to start operating by the middle of the decade.
Woodfibre is licensed to export about 2.1 million metric tons a year of gas chilled to a liquid so it can be shipped to faraway destinations on special tankers. The decision to boost spending comes as European countries scramble to find alternatives to Russian gas and cut the continent’s dependence on the energy-producing giant following Vladimir Putin’s invasion of Ukraine.
FortisBC, a unit of Fortis Inc., also gave Squamish officials an update on the Eagle Mountain-Woodfibre Gas Pipeline, which would connect the proposed project to an existing natural gas transmission line.
Fortis is proposing to increase the size of its planned work camp to accommodate as many as 600 people during peak periods.
“We listened and have made design changes to eliminate pressure on local housing, to address traffic congestion and to alleviate other pressures on community resources,” Fortis BC’s director for the project, Darrin Marshall, said in an emailed statement.
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