TransCanada Corp. has received a contract from Shell Canada Ltd. to build and operate a pipeline expected to cost C$3.85 billion that will transport natural gas to a planned LNG export facility near Kitimat, BC.
In May, Shell Canada parent Royal Dutch Shell PLC, Mitsubishi Corp., Korea Gas Corp. and PetroChina Co. formed a joint venture – led by Shell – to pipe gas to Canada’s Pacific Coast, where the gas would be deep-chilled and exported by sea to Asia.
TransCanada said its pipeline, the proposed Coastal GasLink project, will transport natural gas from the Montney gas-producing region near Dawson Creek, BC to the LNG Canada facility.
The Calgary-based pipeline company said the proposed pipeline will have an initial capacity of about 1.7 Bcf/d. TransCanada plans to file a project description with the BC Environmental Assessment Office in the fall of 2012 and file the Environmental Assessment Application in early 2014.
Pending all required regulatory and project approvals, construction of the proposed pipeline is expected to begin in the summer of 2015 with pipeline operations beginning in time to meet the in-service requirements of the proposed LNG Canada facility.
Royal Dutch Shell Chief Executive Peter Voser estimated the cost of the first phase of the planned LNG Canada facility at about C$12 billion.