Woodfibre LNG to splash $500 million on its Canadian export development in 2022

Canada’s Woodfibre LNG, a unit of Pacific Energy, said it would spend $500 million on its planned 2.1 mtpa LNG terminal in British Columbia this year.

The company revealed this in a project update released on March 22 following a meeting of Woodfibre LNG’s president, Christine Kennedy, with local government officials.

Woodfibre previously said that the project would cost up to C$1.8 billion ($1.43 billion). This means the approved budget of $500 million for 2022 would cover a large part of the total costs.

The company has not yet announced a final investment decision on the project.

In November last year, Woodfibre LNG contracted Houston-based McDermott to build its LNG terminal with floating storage of about 250,000 cbm.

Under the engineering, procurement, fabrication, and construction (EPFC) contract, McDermott would manage onshore construction of the facility located about 7 km west-southwest of Squamish.

Besides this deal, Canada’s FortisBC has recently awarded Frontier-Kemper Constructors a contract to work on a tunnel component for a pipeline that would deliver gas to the LNG plant.

Completion in 2027

Woodfibre LNG previously said that the pre-installation work for the project would begin in early 2022 and would gradually ramp up to September 2023, when the firm had expected major construction to start.

The firm said in the update on Friday it has approved spending of over C$25 million for
pre-construction works this year.

In May last year, Woodfibre LNG signed a second supply deal with a subsidiary of energy giant BP for volumes from its planned export plant.

Under the deal, BP Gas Marketing would receive 0.75 million tonnes per annum of LNG over 15 years on a free on board (FOB) basis.

This deal boosted BP’s total LNG offtake to 1.5 mtpa, over 70 percent of Woodfibre’s future annual production.

Woodfibre LNG expects substantial completion of the plant in the third quarter of 2027.

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