The Haisla Nation and Pembina Pipeline Corporation announced the FID this week
KITIMAT – The partners in Cedar LNG have announced a positive Financial Investment Decision (FID), the final step of determining whether to move forward on the massive liquified natural gas project.
The Haisla Nation and Pembina Pipeline Corporation announced the FID this week for the facility, which will have a capacity of 3.3 million tonnes of natural gas and is located within the traditional territory of the Haisla Nation.
The project is expected to be funded with asset-level debt financing for approximately 60 percent of the project’s cost, and Cedar LNG has secured a construction term loan with a syndicate of banks. The remaining approximately 40 percent of the costs of the Project are expected to be financed through equity contributions from both partners. Cedar LNG is majority-owned by the Haisla Nation (50.1%), in partnership with Pembina Pipeline Corporation (49.9%).
Under a long-term transportation agreement with Coastal GasLink Pipeline Limited Partnership, Cedar LNG will receive 400 million cubic feet per day of Canadian natural gas via the Coastal GasLink pipeline. The project has a total estimated cost of approximately US$4.0 billion, including estimated capital costs of approximately US$3.4 billion.
Cedar LNG has secured 20-year take-or-pay liquefaction tolling services agreements with ARC Resources Ltd. and Pembina for 1.5 million tonnes per annum (mtpa) each. The project is expected to create up to 500 jobs during peak construction and approximately 100 full-time jobs during operation.
“Together with our partner, the Haisla Nation, we are honoured to have made Cedar LNG a reality,” says Scott Burrows, Pembina’s President and Chief Executive Officer. “This is a historic moment, and we are proud to be moving forward with a project that will deliver industry-leading, low-carbon, cost-competitive Canadian LNG to overseas markets and contribute to global energy security, while delivering jobs and economic prosperity to the local region.
“Cedar LNG aligns perfectly with our strategy and where we want to be as a company moving forward. The Cedar LNG Project will enhance the resiliency of Pembina’s business, provide much needed new egress and greater access to global markets for our customers, and reflects the Haisla Nation and Pembina’s shared values and commitment to supporting a more sustainable future.”
Cedar LNG Chief Executive Officer Doug Arnell adds, “As a result of the Haisla Nation’s vision and determination, today we are demonstrating Canada’s ability to sustainably grow its LNG export sector to support the global clean energy transition. Moreover, the Haisla Nation and Pembina, as true partners, are demonstrating a new model for how industry and Indigenous communities can work together for mutual benefit.”
District of Kitimat Mayor Phil Germuth says, “We are incredibly happy to celebrate the news that Cedar LNG will be moving forward. This decision is historic for the Haisla Nation and significant for all residents in Kitamaat Village and the District of Kitimat who are seeing our community continue to grow as an energy hub for the world.”
By Mark MacDonald
