CNOOC weighs up LNG expansion in Canada
State-owned oil firm's newly acquired Nexen signs agreement to study possible construction of natural gas facilities on Canadian west coast
CNOOC, China's dominant offshore oil and gas producer, has agreed to examine the viability of building facilities on the west coast of Canada to liquefy and export natural gas produced from interior fields, as part of the country's efforts to secure more energy sources.
Calgary-based Nexen, which state-backed CNOOC bought early this year, has entered into an "exclusive agreement" with the government of British Columbia on the possible project at Grassy Point, near the port city of Prince Rupert.
"LNG [liquefied natural gas] export is the most attractive option for maximising the value of our Canadian shale gas business," said CNOOC chief executive Li Fanrong.
Li said the firm and its joint-venture partners, Japan's oil firm Inpex and engineering contractor JCG, had ample financial capacity and LNG expertise to pursue the project.
The project would go ahead only if the partners were satisfied with its economic appeal, which depended on construction costs, taxation terms offered by the British Columbia government and success in securing "acceptably priced" sales agreements, CNOOC said in a statement.
Rival PetroChina's parent China National Petroleum Corp already has a 20 per cent stake in another planned LNG export project in British Columbia.
