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Chevron halts funding for Kitimat LNG project

Chevron Canada announced Wednesday that it will stop funding feasibility work on its Kitimat LNG project.

Chevron owns 50 per cent of the project and is the operator. The other 50 per cent is owned by Australia’s Woodside Petroleum Ltd.

The move comes after Chevron was unable to sell its portion of the project. In December 2019, Chevron Canada Limited announced its plan to divest its 50 per cent interest in the proposed Kitimat LNG Project.

“This decision was a part of Chevron’s global portfolio optimization effort focused on improving returns and driving value,” according to a statement posted on the company’s website. “Despite the many challenges posed by COVID-19, Chevron engaged in a process to divest while continuing to work with its joint venture partner, Woodside, on agreed project activities that brought value to the asset or were required for regulatory and operational compliance. At this time, it is Chevron’s intent to cease Chevron-funded further feasibility work for the proposed Kitimat LNG Project.”

Chevron’s other assets in Canada are not included in this decision.

The project comprises upstream resource assets in the Liard and Horn River Basins in northeast B.C.; the 471-km Pacific Trail Pipeline (PTP); and a natural gas liquefaction facility at Bish Cove near Kitimat. The Kitimat LNG Plant includes up to three LNG trains totalling 18 million tonnes per annum (6.0 MTPA/train), and is an all-electric plant powered by hydroelectricity from BC Hydro.

Kitimat LNG has a benefits agreement with the Haisla Nation for the LNG Plant that is located on Haisla Nation Reserve land, and an agreement with all 16 First Nations along the proposed Pacific Trail Pipeline route through the First Nations Limited Partnership (FNLP). These agreements include training, employment, goods and services contracting, environmental stewardship and financial benefits to our First Nation partners.

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