Australian gas giant signs deal for LNG from $30 billion Ksi Lisims BC megaproject
Welder working on a gas line on the Cedar LNG project in BC. Photo Cedar LNG
Developers of Canada’s $30 billion Ksi Lisims liquefied natural gas project have signed a 20-year deal with Australian gas giant Santos for delivery of 1 million tonnes a year, the third contract announced this year as the controversial project heads toward a final investment decision this year.
The non-binding, preliminary contract — known as a heads of agreement — brings total offtake sales from the coastal BC project to two-thirds of its planned 12 million tonnes per annum (mtpa) export capacity, though only 6 million tonnes are locked in under finalized sales and purchase agreements.
However, skyrocketing construction budgets, an unbuilt pipeline to feed the project’s floating export terminal, and fears of a looming global gas glut continue to cast a shadow over Ksi Lisims, one of 167 projects listed in the Canada Investment Summit prospectus this week.
“Santos’ decision to secure long-term supply from Ksi Lisims LNG reflects a shared commitment to responsible energy development and a clear view that supply diversity is essential to long-term energy security,” said Davis Thames, CEO of Texas-based Western LNG, which is developing the project with BC’s Nisga’a Nation and Western Canadian gas producer group Rockies LNG.
Santos’ mulled sales agreement for the project “reflects a growing global role for reliable, low-carbon, Canadian LNG,” Thames said, adding that the agreement “is a strong signal of confidence in our project as we move into the final stages of commercialization and toward a final investment decision.”
Energy and Natural Resources Minister Timothy Hodgson said the agreement – coming as investors managing $120 trillion in capital attended the Canada Investment Summit in Toronto, “shows that it is our moment — if we choose to seize it” to expand Canada’s LNG exports.
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