Parties agree to final investment collaboration on LNG Canada phase two

VANCOUVER, B.C. — The federal and provincial governments have reached a co-operative investment agreement supporting a final investment decision on LNG’s proposed phase two expansion project.

Built in Kitimat, LNG Canada is a terminal which exports liquified natural gas (LNG) via pipeline from the Montney Formation near Dawson Creek.

Phase two is a project which would double the terminal’s capacity, allowing it to export up to 28 million tonnes of LNG annually.

The announcement was made on Thursday, May 14th, with federal minister of energy and natural resources Tim Hodgson alongside B.C. premier David Eby, joined by the president of the King’s Privy Council for Canada and federal minister responsible for Canada-U.S. trade, intergovernmental affairs, internal trade and one Canadian economy, Dominic LeBlanc and LNG chief executive officer and president Chris Cooper in Vancouver.

The news follows a decision earlier this month by joint venture participants in LNG Canada – which include Shell, Petronas, PetroChina, Mitsubishi Corporation and Korean Gas Corporation – to approve vital capital assisting final work scopes for a potential final investment decision by the end of 2026.

 Eby described the progress as “another major step toward a stronger and more independent future,” for the province and Canada as a whole. 

“LNG Canada Phase two would mean more work for skilled trades, more opportunities for local businesses, more revenue for public services and bigger paycheques supporting families across British Columbia,” Eby told assembled reporters. 

“At a time of global uncertainty, B.C. and Canada are showing the world that we are a reliable partner with the resources, people and ports to help meet growing energy demand – while creating prosperity here at home.” 

The cooperation agreement lists four main pillars of mutual cooperation.

They include working collaboratively with First Nations in LNG Canada’s proposed Phase two expansion; building on Canada’s competitiveness and investment climate – locally, provincially and nationally; ensuring jobs and training opportunities and further diversifying export markets and growing the secure supply of responsibly produced Canadian LNG to foreign markets. 

“Today’s announcement demonstrates the progress we are making to advance critical projects like the proposed LNG Canada Phase 2 expansion and the Government of Canada’s commitment to moving forward faster and in a more coordinated way,” said LeBlanc. 

Cooper said the agreement brings the parties “closer together,” as a final investment decision for phase 2 is expected before 2027.

“Now is the moment for purposeful collaboration to satisfy all the requirements necessary for a positive FID and seize a generational opportunity that could materially increase the scale of reliable, responsibly produced made-in-B.C. LNG for decades to come,” said Cooper.

Details about LNG Canada are available on LNG Canada’s website.