Canada's Woodfibre to Supply LNG to China's Cnooc

Canada-based Woodfibre LNG Export has signed an initial agreement with China’s Cnooc Gas and Power for supply of 0.75mn metric tons/year of LNG for 13 years starting 2023, Singapore-based Pacific Oil & Gas, the parent company of Woodfibre LNG Export said September 29.

The Woodfibre LNG project is located southwest of Squamish, British Columbia, Canada and is licensed to export approximately 2.1mn mt/yr for 40 years. With the Cnooc agreement, the terminal now has line of sight to 1.75mn mt/yr of LNG offtake - a May 2016 heads of agreement with Guangzhou Gas Group contemplates 1.0mn mt/yr to fuel a peak-shaving power generating station in Guangzhou City, China. 

An EPC contract between Woodfibre LNG and KBR is now being finalised, and construction on the project is expected to begin in 2019, a Woodfibre LNG spokeswoman told NGW.

Cnooc Gas and Power, a unit of Chinese state Cnooc, is the largest LNG importer in China and operates nine LNG receiving terminals in the country.

With US-China trade war leading to Beijing imposing tariff on LNG, China is looking to source LNG from other sources such as Qatar and Canada. China’s LNG imports have been rapidly rising due to government’s coal to gas switching policy. Asia’s biggest economy became the world’s second largest LNG importer last year, overtaking South Korea.