LNG Canada has started production of liquefied natural gas at the second of its two processing units, known as Train 2, the company said. Both trains at the Shell-led project in Kitimat, British Columbia - each with a capacity of 6.5 million tonnes per annum - are now operational, a spokesperson told Reuters.
LNG Canada is the first major LNG export facility in Canada and the first on the west coast of North America that provides direct access to Asia, the world’s largest market for the liquid fuel. When fully operational, the facility is expected to process about two billion cubic feet of gas per day.
LNG Canada, which took almost seven years to build, shipped its first cargo on June 30. However, technical challenges have made the ramp-up slower than many analysts expected. A 22nd LNG cargo departed the LNG Canada facility on Thursday for export to global markets, the spokesperson said.
Market participants have expressed hope that the startup of the second train will create enough demand to reduce the glut of natural gas in storage in Western Canada and help lift prices.
LNG Canada is a joint venture between Shell, Malaysia’s Petronas, PetroChina, Japan’s Mitsubishi Corp, and South Korea’s KOGAS. Last month, MidOcean - an LNG company backed by EIG and Saudi Aramco - announced a plan to buy a fifth of the Petronas venture that holds a 25 per cent share of LNG Canada.
(Reporting by Amanda Stephenson in Calgary and Curtis Williams in Houston; Editing by Nathan Crooks and Emelia Sithole-Matarise)
