Agreement reached on land to build LNG facility at Grassy Point

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A new liquefied-natural-gas (LNG) export facility called Aurora LNG is another step closer at Grassy Point near Prince Rupert, thanks to an agreement between the Government of British Columbia and Nexen Energy ULC, a wholly owned subsidiary of CNOOC Limited and its joint venture partners, INPEX Corporation and JGC Corporation. Premier Christy Clark announced the details of the agreement in Vancouver on Tuesday.

“As the global economy continues to struggle, LNG presents a singular opportunity to transform our economy,” said Clark. “While we have a lot more work ahead of us, this agreement is another step towards realizing that opportunity.”

LNG development at Grassy Point is subject to regulatory approval and investment decisions by the joint venture partners.

The agreement is the result of a Request for Expression of Interest initiated by the Province in February 2013. The request provided industry with an opportunity to submit LNG development proposals for an area of provincial Crown land known as Grassy Point. The request attracted four suitable submissions. Discussions are ongoing with the remaining three proponents for an adjacent parcel of land at Grassy Point.

“Through project assessment and stakeholder consultation we are committed to examining the potential to build a best-in-class LNG facility – one that creates jobs, delivers lasting economic and social benefits and is developed with the environment top-of-mind,” said Nexen CEO Kevin Reinhart, on behalf of his company and joint venture partners, INPEX and JGC.

The agreement between the Province of British Columbia and Aurora LNG is a sole proponent agreement, which provides the companies involved with the exclusive right to move forward with the planning necessary to build LNG export infrastructure at Grassy Point.

“Building an LNG export industry is an unprecedented opportunity to create thousands of jobs while supplying Asian markets with the world’s cleanest burning fossil fuel,” said Minister of Natural Gas Development Rich Coleman. “Natural gas is redefining the economic prospects of British Columbians, and our government will ensure these benefits are enjoyed for generations to come.”

Aurora LNG joins an expansive list of industry projects making strides in the province, many of which are already investing in B.C.’s natural-gas sector and boosting local economies. There are now 10 LNG project proposals in British Columbia.

As part of its future planning, Aurora LNG will need to acquire an export permit from the National Energy Board. It will also have to submit project descriptions with British Columbia and Canada to successfully complete the environmental assessment process.

The Province will continue to work with industry, First Nations and communities to ensure lasting benefits are achieved as the industry develops.

Assuming five LNG plants and the supporting pipelines are built, more than 39,000 annual jobs will be created over a nine-year construction period and 75,000 jobs once these plants are fully operational.