(The Canadian Press) KUALA LUMPUR, Malaysia _ Malaysian national oil company Petronas says it expects to spend up to $16 billion to build a liquefied natural gas export facility and related infrastructure in Western Canada.
Arif Mahmood, Petronas, vice-president of corporate planning, says the company will invest between $9 billion and $11 billion to construct two LNG liquefaction plants near British Colombia's west coast.
Another $5 billion will be invested in a 750 kilometre-long pipeline, to be built by TransCanada Corp. (TSX: T.TRP, Stock Forum), to supply gas to the two plants, he said Tuesday in an email to The Associated Press.
The Pacific Northwest LNG project, located on Lelu Island in the Port Edward district, will liquefy and export natural gas produced in northeastern British Columbia by Progress Energy Canada.
Petronas bought Calgary-based Progress last year in a $6-billion friendly deal. The two companies had been previously working together on the same projects.
In January, Calgary-based TransCanada said it would design, build, own and operate the proposed Prince Rupert Gas Transmission project for Progress Energy.
Petronas secured its first LNG buyer, Japan Petroleum Exploration Co., in March.
Japex has agreed to take a 10 per cent stake in both Petronas’ properties in B.C.'s Montney formation as well as as the Lelu Island LNG plant near Prince Rupert, B.C.
The gas will be chilled into a liquid state so that it can be transported across the Pacific by tanker.
TransCanada shares eased 0.41% to $46.64 on Tuesday, leaving the company with a market cap of $32.9 billion, based on 706.6 million shares outstanding. The 52-week range is $51.21 and $41.47.