Petronas and its subsidiaries Progress Energy Canada and Pacific NorthWest LNG have signed transaction agreements with China Petrochemical Corporation (Sinopec) for Canadian LNG project.
Under the terms of the agreement, Sinopec, through its affiliates, will acquire a 15% stake in Progress Energy’s LNG-destined gas reserves in northeast British Columbia and in Pacific NorthWest’s proposed LNG export facility on Canada’s West Coast.
Sinopec will also off-take 1.8 million tons of LNG per annum (MTPA), which represents a pro-rata 15% of the LNG facility’s production, for 20 years, as part of the transaction.
Progress Energy in Calgary president and CEO Michael Culbert said, "We are pleased to conclude the addition of another Pacific Rim market and investment into British Columbia which continues to highlight the attractiveness of Canadian natural gas."
Additionally, a binding heads of agreement has been signed by Sinopec, through its affiliate, with Petronas for the purchase of additional 3 MTPA of LNG primarily from the Pacific NorthWest LNG project for 20 years.
Pacific NorthWest LNG president Greg Kist said, "Our energy export sector continues to gain momentum with this transaction and the addition of a fourth investor."
Upon completion of the acquisitions by Indian Oil and Sinopec, Petronas will hold a 62% interest in the integrated project and will continue to work with potential customers to secure markets for LNG.