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For Your Information The LNG Canada ProjectThe engineering and overall supervision of the construction of the LNG Canada project has been awarded to a joint venture of two large engineering companies, JGC of Japan and Fluor Corporation of the U.S.
The pipeline project is backed by a 25-year transportation service agreement between TransCanada Corporation and the LNG Canada partners. The second phase is the construction of an $18-billion gas liquefaction and storage plant in the port of Kitimat, BC, with two liquefaction trains where the natural gas will be cooled to reach its liquid state, and then stored to await transfer to LNG ships for transport to Asian markets. A new terminal for LNG carrier ships will be built at the port of Kitimat, BC connected to the LNG Canada liquefaction and storage plant. LNG carrier ships will sail up and down the Douglas Channel, to and from the port of Kitimat, to load LNG and sail fully loaded to overseas destinations, mainly in Asia. Such ships may be owned and operated by some of the LNG Canada partners, or by their LNG purchasing clients or they may be time-chartered from specialized independent ship owners and operators of such specialized ships. Two partners, Royal Dutch Shell and Mitsubishi have stated that the project will initially export LNG from two processing units, or trains, totalling 14 million tonnes per annum (mtpa) of natural gas, and that, ultimately, the project may add two more trains for another 14 mtpa.
When completed, LNG Canada will likely be the first Canadian terminal to export LNG overseas, whereas several LNG liquefaction and export terminals are already operating on the Gulf and Atlantic coasts of the United States, with others being planned, including on the U.S. west coast. Within 10 days of the announcement of the LNG Canada investment decision in October 2018, two Japanese gas utilities, Toho Gas and Tokyo Gas, signed heads of agreement for LNG purchasing contracts over 15 and 13 years, respectively, with a subsidiary of one of the LNG Canada partners and shareholders, the Mitsubishi Group. LNG Canada is the recipient of tax incentives. The BC government offered the project a break on the BC carbon tax, as well as the provincial sales tax. The total subsidies for the project are valued at $5.35 billion. The subsidies extend beyond the natural gas plant itself, to new transmission lines that are being built by BC Hydro to service the gas fields where the gas will be extracted through hydraulic fracturing. These transmission lines have a cost of $296 million. The LNG project is slated to be a major recipient of electricity from the new Site C dam and hydroelectric project, which will cost more than $10.7 billion to build and is experiencing cost overruns. The liquefaction process requires tremendous energy consumption usually from natural gas but, if electricity is available from Site C or independent run of river producers at a lower cost, it will be used. NotesLNG Canada:The LNG Canada Website says the company will export Canadian natural gas to Asian markets, and in the process, put Canada on the global map of LNG exporting countries and create a world-class liquefied natural gas (LNG) industry in British Columbia and Canada. Joint Venture Participants: Royal Dutch Shell Plc. (40 per cent, lead partner), of the UK and Holland; PETRONAS (25 per cent), of Malaysia; PetroChina Co. Ltd. (15 per cent), of China; Mitsubishi Corp. (15 per cent), of Japan; and Korea Gas Corporation (5 per cent) of Korea. Shell: a global leader in LNG since 1964, helping to pioneer the LNG sector. Shell operates about 20 per cent of the world's LNG vessels and has LNG supply projects either in operation or under construction in ten countries. PETRONAS: a fully integrated
energy company with extensive experience in LNG.
Through its wholly owned upstream energy company
Progress Energy and its partners, PETRONAS is one
of the largest natural gas reserves owner in
Canada — with the majority of these reserves in
the North Montney natural gas formation in
northeast British Columbia. The price of natural
gas has fallen to The ownership by PETRONAS of gas reserves in BC
with plans to greatly expand production when
Coastal GasLink begins transporting gas to Kitimat
brings to mind the situation in Alberta where
producers of oil sell it upstream in the U.S. to
themselves at a cheap price for refining and
eventual sale at higher prices. In this situation,
the cartels that control production and
distribution can drive smaller producers out of
business through low prices, declare poverty in
Alberta, abscond without paying corporate taxes or
royalty fees, and instead demand pay-the-rich
schemes including free infrastructure and other
subsidies. Mitsubishi Corporation: Japan's largest trading cartel with more than 50 per cent share of LNG imported into Japan. Mitsubishi has been investing in LNG since 1969 and has an interest in 11 LNG export projects globally. Mitsubishi is also a member of the Mitsubishi keiretsu (Group). The Mitsubishi Group employs 350,000 people and has many business segments or subsidiaries including finance, banking, energy, machinery, chemicals, beer and food. Mitsubishi is one of the original zaibatsu following the overthrow of the Edo feudal era of petty production in 1868. The zaibatsu were large financial houses and trading and manufacturing companies controlled by powerful business and merchant families. They immediately made the transition to become dominant monopolies, as merged industrial and financial companies after the overthrow of the Edo feudal government and international trade and overseas investment of social wealth became commonplace. The original seven zaibatsu were Mitsui, Mitsubishi, Sumitomo, Yasuda, Furukawa, Asano and Kawasaki. Korea Gas Corporation (KOGAS): the world's largest LNG importing company and south Korea's principal LNG provider. KOGAS operates four LNG import terminals and a nationwide pipeline network in South Korea, and another terminal in Mexico.
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The first phase of
the project is to include a $6.2-billion Coastal
GasLink Pipeline through northern BC, built and
operated by TransCanada. Coastal GasLink is
projected to be a 670-kilometre gas pipeline with
an initial capacity of about 2.1 billion cubic
feet per day (Bcf/day) with the potential for
expansion of up to approximately 5 Bcf/day.
Permits have been issued by the BC government for
the project to proceed in spite of the fact that
the hereditary chiefs of the Wet'suwet'en people,
whose lands the pipeline is to traverse, have not
given their consent and are determined to continue
fighting to stop construction of any pipelines on
their unceded territory. 
The global LNG
industry, as natural gas in liquefied form, is
being used more and more extensively and directly
to fuel power plants, petrochemical and other
industrial plants and for natural gas distribution
through pipelines to homes and offices, as well as
to fuel various transport modes such as ocean
shipping.