British Columbia sees $7.1 billion from Petronas-led LNG export project
By REBECCA PENTY
Bloomberg
British Columbia is pledging to cap levies on Petronas’ gas export project as it expects to collect C$9 billion ($7.1 billion) from the venture by 2030.
Canada’s westernmost province must compensate the Malaysian oil producer, known as Petronas, and its partners if it adds costs through changes to certain taxes or credits over the next 25 years, according to terms of an agreement signed May 20 that were released Monday.
“The revenue opportunities are significant,” British Columbia's finance minister Michael de Jong said in a briefing with reporters Monday.
Petronas and its partners said last month that they will conditionally move ahead with the C$36 billion export terminal, known as Pacific NorthWest LNG, among 19 proposed in British Columbia to ship liquefied natural gas (LNG) to Asia. The agreement must be approved by the provincial legislature.
Groups including the Pembina Institute, an environmental organization, have criticized the potential costs of the provincial government’s guarantees to Petronas.
The government’s take is based on assumptions including a premium of $7/MMBtu for LNG sold from Canada’s Pacific Coast over the Henry Hub US benchmark gas price.
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