Kitimat LNG Inc., the company proposing to build a massive liquefied natural gas export terminal in B.C., is lining up major Asian customers for the gas, although it's yet to secure any suppliers.
Korea Gas Corp., the world's largest LNG importer, is the latest customer to sign a memorandum of understanding with Kitimat. According to the terms of the agreement, Korea Gas will acquire up to 40% of Kitimat LNG's production, or two million tonnes per year, from the proposed terminal for 20 years.
The total purchase value over that period would be more than US$20 billion, according to Kitimat LNG's president Rosemary Boulton, who described the MOU as a significant milestone in the development of the terminal near the Port of Kitimat.
Korea Gas also has the option to acquire an equity stake in the terminal. The facility will receive natural gas via pipeline from Western Canada before being cooled and liquefied in preparation for export via ship to growing Asian markets.
Boulton said Kitimat LNG, a Calgary-based private company, is still trying to attract other potential terminal users and investors.
Earlier this year, Mitsubishi Corp., Japan's largest general trading company, had indicated it would acquire both terminal capacity and an equity stake in the terminal.
Mitsubishi is an industry leader in the global LNG sector and handles nearly half of Japan's LNG imports.
According to a non-binding document signed by the two companies, Mitsubishi will commit to buy 1.5 million tonnes a year of terminal capacity and acquire a minority equity interest in the terminal, which will have an annual capacity of five million tonnes.