Shell-led LNG Canada greenlights Phase 2 expansion, doubling export capacity

Shell and its joint venture partners on Tuesday gave the final investment decision for the Phase 2 expansion of the LNG Canada export terminal in Kitimat, British Columbia, doubling the facility’s export capacity from 14 million tonnes per annum (mtpa) to roughly 28 mtpa.

The expansion adds two additional liquefaction trains; Reuters had exclusively reported earlier this month that a decision was expected as early as October.

Shell, which holds a 40% stake, said it expects to receive nearly 6 mtpa of additional LNG from the expansion, with commercial operations targeted for the early 2030s. LNG Canada is led by Shell and backed by Malaysia’s Petronas, PetroChina, Mitsubishi Corp and Korea Gas Corp (KOGAS) — Canada’s first large-scale LNG export terminal.

Also on Tuesday, TC Energy (TRP.TO) said its Coastal GasLink Phase 2 project will proceed following LNG Canada’s positive final investment decision. It will nearly double the pipeline’s capacity through new compressor stations and upgrades along its existing 670-km route linking Dawson Creek to the Kitimat facility.

The decisions come as tight global markets, producer outages and coal-to-gas demand growth drive interest in new LNG projects and more diversified supply sources.