LNG and the Douglas Channel

The following projects are underway or slated for Kitimat and the Douglas Channel. In total, the province of British Columbia has 19 applications with the government for LNG alone.

Rio Tinto Alcan Modernization, $4.8 billion USD

The Kitimat Modernization Project (KMP) will increase the smelter's production capacity by 48 per cent to approximately 420,000 tonnes of aluminum ingot per year using the most cost effective, energy efficient and environmentally friendly technology available. The company announced its final investment decision on December 1, 2011. Construction labour at peak (fall 2014) was approximately 3,400 including 1,000 local persons. The new smelter is expected to be in operation in the first half of 2015 and provide full-time employment for approximately 1,000.

Kitimat LNG

Chevron Canada and Woodside Canada each hold a 50 per cent stake in the Kitimat LNG terminal, Pacific Trail Pipeline and 644,000 gross undeveloped acres in the Horn and Liard River basins in northeastern British Columbia. Woodside became a co-venturer in April 2015. Kitimat LNG will have an initial capacity to produce 700 million cubic feet of natural gas per day or five million tonnes of liquefied natural gas per year. In October 2011, the National Energy Board granted a permit to export up to 10 million tonnes of LNG annually over 20 years. In January 2014, the Engineering, Procurement and Construction (EPC) Contract was awarded to a joint venture involving Fluor Canada and JGC Corp. of Japan. Required labour is estimated to be 3,000 – 5,000 jobs during construction and up to 100 – 200 permanent jobs for operation. The project is still subject to a final investment decision. Site preparation and other early works are ongoing, along with construction of temporary worker accommodation on the site of the former Eurocan Pulp & Paper mill.

Pacific Trail Pipeline

New 42-inch, 470 km pipeline to supply gas from Summit Lake, BC (north of Prince George) to Kitimat LNG for export. PTP is expected to move one billion cubic feet of natural gas per day. Provincial and federal environmental approvals were granted in 2008 and 2009, respectively. Front End Engineering and Design study was undertaken in 2010. The First Nations Limited Partnership for the PTP project ensures all 16 First Nations whose traditional territory is located along the pipeline route will receive immediate and long-term benefits from the project. A final investment decision is expected in conjunction with the Kitimat LNG project. Chevron Canada and Apache Canada are each 50 per cent owners of PTP. In December 2014, Woodside Petroleum announced its intention to acquire Apache’s 50 per cent stake.

Douglas Channel LNG

This small-scale project is being led by the Douglas Channel LNG Consortium. Members of the Consortium include: AIJVLP, a limited partnership between AltaGas Ltd. and Idemitsu Kosan Co., Ltd., EDF Trading and EXMAR. The project is located on the west side of the Douglas Channel, south of Moon Bay, on District Lot 99. The project will be a barge-based floating facility with the ability to produce 550,000 tonnes of LNG per year. Long term lease agreements have been executed with the Haisla Nation for land and water tenure. Pipeline capacity agreements with Pacific Northern Gas for long term gas supply on their existing pipeline network serving Kitimat has also been secured. The Consortium expects LNG exports could start as early as 2018.

LNG Canada, $25 billion to $40 billion

In May 2012, Shell Canada formally announced the development of a proposed two billion cubic feet per day liquefied natural gas export facility on the site of the former Methanex methanol plant. LNG Canada is a joint venture led by Shell (50 per cent interest) along with PetroChina Co. (20 per cent), KOGAS (15 per cent) and Mitsubishi (15 per cent). CFSW LNG Constructors, a partnership of Chiyoda, Foster Wheeler, SAIPEM and WorleyParsons, was announced as the main contractor for construction of the LNG Canada facility on May 20, 2014. The project consists of the construction and operation of natural gas treatment facilities, liquefaction and storage facilities, marine terminal facilities, an interconnecting cryogenic transfer pipeline, and supporting infrastructure.

LNG Canada will initially consist of two-trains, each with the capacity to produce six million tonnes of LNG per year, with an option to expand the project in the future. Approximately 5,500 – 7,500 jobs will be created during construction and 400 – 800 for operations. In February 2013, the National Energy Board awarded a permit to export up to 24 million metric tonnes of LNG annually over 25 years. A project description was filed with the federal and provincial environmental assessment agencies in April 2013. In November 2014, a power agreement was reached with BC Hydro to allow LNG Canada to use clean, renewable electricity for ancillary needs. The project received provincial and federal Environmental Assessment Certificates in June 2015. A decision to move the project into development could be taken in late 2015/early 2016, with start up around the end of the decade (pending regulatory approvals and investment decisions).

Coastal GasLink, $4 billion

TransCanada Corp. has been selected by Shell Canada and its partners to design, build, own and operate the proposed Coastal GasLink project, a 48-inch, 700 km pipeline that will transport natural gas from the Montney gas-producing region near Dawson Creek, BC to the LNG Canada liquefied natural gas export facility in Kitimat. The pipeline will have the capacity to move 1.7 billion cubic feet of natural gas per day. It is estimated 2,000 – 2,500 construction jobs will be realized over a three year construction period. Coastal GasLink received an Environmental Assessment Certificate in October 2014. The pipeline is expected to be in service near the end of the decade, coinciding with LNG Canada plant commencing operations.

Triton LNG


AltaGas Ltd. and Idemitsu Canada Corp. have formed a limited partnership for a proposal to develop a floating liquefied natural gas facility to be located in the vicinity of either Kitimat or Prince Rupert. The National Energy Board approved an application for a 25-year LNG export licence on April 16, 2014. The facility is expected to process approximately 2.3 million tonnes of LNG annually. Triton has signed a 20-year transportation reservation agreement with Pacific Northern Gas for 325 million cubic feet per day of natural gas transportation capacity related to the PNG Looping Project.

Pacific Northern Gas Looping Project


Pacific Northern Gas (PNG) is proposing to upgrade its gas transmission capacity by looping (or twinning) its existing natural gas transmission pipeline between Summit Lake, BC and Kitimat. The new pipeline will increase the overall pipeline capacity of the PNG Transmission System in order to meet the requirements of its existing customers and new small-scale liquefied natural gas projects proposed for construction in Kitimat. The project involves the construction of approximately 525 km of new 24-inch pipe, operating in parallel with the existing 10-inch pipeline. The project would also include the replacement of four existing compressor stations and would have an initial capacity of 600 million cubic feet per day. A project description was filed with the federal and provincial environmental assessment agencies in July 2013. The project is expected to generate approximately 1,800 – 2,400 direct person years of employment during construction.

Cedar LNG

In August 2014, the Haisla Nation submitted three separate applications to the National Energy Board for 25-year liquefied natural gas export licences. The applications seek approval to export varying quantities of LNG to Asian markets from either barge-based or floating LNG vessels to be located at up to three locations along the west side of the Douglas Channel. Each application relates to separate and independent commercial arrangements with gas producers, purchasers and shippers. Pipeline capacity required to transport natural gas to Cedar LNG could include a mix of new and already-proposed third party infrastructure. Construction is anticipated to occur between 2017 and 2020.

Enbridge Northern Gateway, $7.9 billion

Northern Gateway Pipelines Limited Partnership proposes to construct two, 1,177 km pipelines between Bruderheim, AB and Kitimat. A 36-inch diameter pipeline flowing west will carry up to 525,000 barrels of oil per day. The eastbound 20-inch diameter pipeline will carry 193,000 barrels of condensate per day. A two-berth marine terminal and tank farm is proposed to be located on the west side of Douglas Channel, north of Bish Creek. Ten pump stations will be powered by electric pumps to limit noise and greenhouse gas emissions. The regulatory review commenced in May 2010. The Joint Review Panel (JRP) of the Canadian Environmental Assessment Agency and National Energy Board recommended approval of the project in December 2013. The Government of Canada granted approval in June 2014, subject to 209 conditions recommended by the JRP. The project is expected to employ 165 persons to operate the marine terminal and tug fleet, to maintain first response and to monitor the environment.

Kitimat Clean Refinery, $32 billion

In August 2012, Kitimat Clean Ltd. submitted a proposal to build a large oil refinery in the Kitimat Valley to process heavy crude oil delivered by pipeline or rail. An environmental assessment is in progress. The refinery will process 550,000 barrels of diluted bitumen per day, producing 240,000 barrels per day of diesel, 100,000 barrels per day of gasoline, and 50,000 barrels per day of aviation fuel. Approximately 6,000 workers will be required during the construction phase, and the refinery will create 3,000 permanent full time jobs. In April 2013, Kitimat Clean signed a Memorandum of Understanding with the Industrial and Commercial Bank of China, which will serve as a financial advisor and cooperate in the financing of the project. In June 2014, Hatch Ltd. was contracted to conduct a basic engineering design, and Expander Energy entered into an agreement with Kitimat Clean to license its FTCrude refining process.

Source: District of Kitimat Municipal Government