AltaGas, partners scrap Douglas Channel LNG plans in Canada
The Douglas Channel LNG consortium is halting all further development of the DCLNG project in British Columbia due to unfavorable market conditions, the group said on Friday.
Led by AltaGas, the consortium had sought to achieve a final investment decision (FID) by the end of 2015. However, the worsening global energy price levels and a challenging market environment have caused the consortium to withdraw from the project.
Members of the consortium include an AltaGas Idemitsu JV, EDF Trading and EXMAR.
The developers expressed appreciation to all of the stakeholders who worked together on the DCLNG project despite increasingly difficult global economic circumstances, including the Haisla Nation, B.C. Government, local communities, Pacific Northern Gas (PNG), British Columbia Utilities Commission (BCUC), National Energy Board (NEB), and the Canada Border Services Agency (CBSA).
The Douglas Channel LNG partners say the project development milestones achieved by the consortium and the stakeholders help to prove the viability of floating LNG facilities in British Columbia.
"We believe the project could deliver LNG to Japan at very competitive prices," AltaGas CEO David Cornhill said.
"However, without a meaningful offtake agreement the consortium can no longer continue the development of the project."
AltaGas and its global partners had been aiming for the project near Kitimat, B.C., to begin exporting LNG in 2018.
The announcement comes weeks after Shell Canada announced that it would postpone the FID on its huge LNG proposal in Kitimat until the end of the year.
The Douglas Channel project was one of the smallest of the more than 20 proposed LNG projects in Canada. It had planned to export about 2.4 billion cubic meters/year of gas, compared with 33 billion cubic meters for Shell's LNG Canada project.
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