Royal Dutch Shell is delaying its final investment decision (FID) from the anticipated April 2016 timeline to December on the proposed LNG Canada terminal in Kitimat.
In its 2015 fourth-quarter report, Royal Dutch Shell, a 50 per cent stakeholder in the project, stated that a final investment decision will now be made in late 2016, however, LNG Canada said the news is not startling and very much in keeping with their timeline.
“Shell’s quarterly results ... included information that the LNG Canada project FID decision will occur right at the end of this year. This is not inconsistent with information LNG Canada has shared with the community,” Kirsten Walker, LNG Canada spokesperson, said in a prepared statement.
“We have always stated that our joint venture participants plan to make a final investment decision in 2016. We are pleased, given the current oil and LNG prices, and turmoil in global energy markets that the joint venture participants in LNG Canada are still working toward a final investment decision for the proposed facility late this year.”
Backed by a consortium of Shell Canada, Korea Gas, Mitsubishi and PetroChina, the LNG Canada project is a key part of the B.C. government’s bid to enter the global LNG export market. Along with delays on the Petronas-led Pacific Northwest LNG proposed for Prince Rupert, the chances of a large LNG project being under construction by the 2017 provincial election have faded.
Premier Christy Clark was attending an industrial development conference in Ottawa when the delay was revealed.
As with other global energy companies, the glut of oil resulted in a 44 per cent drop in earnings for Shell compared to the same quarter last year.
Clark, who rode the prospect of an LNG revenue bonanza to victory in the 2013 B.C. election, acknowledged that the delay is significant.
“What I was pleased to see, though, is that Shell has reconfirmed its intention to make a final investment decision this year, even in these very uncertain times,” Clark said.
-With files from Tom Fletcher in Victoria