Petronas said the agreement is a synthetic liquefaction service structure for 1.0 mtpa of capacity, under which Pembina will provide transportation and liquefaction capacity to Petronas LNG Ltd over a 20-year term.
It enables Petronas to access an additional natural gas export outlet for its sizeable Canadian upstream investment, while providing Pembina with a stable long-term, take-or-pay revenue stream and the potential for value enhancement.
“The agreement also demonstrates the shared commitment of both Pembina and Petronas to realise the long-term potential of Canadian LNG, supporting energy security and advancing the transition to cleaner fuels in Asia,” it said in a statement.
Petronas Gas and Maritime Business vice-president of LNG marketing and trading Shamsairi M Ibrahim said the agreement reflects Petronas’s long-standing commitment to investment in Canada and continued effort to fortify its global LNG supply portfolio.
“We welcome this partnership with Pembina and the Cedar LNG project as it underscores Petronas’s role as an integrated energy player and demonstrates our dedication to responsibly monetise our gas resources.
“This arrangement improves supply diversity and enhances reliability of supply for customers, while reinforcing our steadfast commitment to deliver reliable, lower-carbon energy solutions to meet Asia’s growing energy needs,” he said.
Pembina senior vice-president and corporate development officer Stu Taylor said the partnership further validates Cedar LNG and highlights the strong demand for global export capacity given the clear advantages of Canadian West Coast LNG, including competitively priced feedstock and advantaged shipping distances to Asian markets.
“This agreement is an extension of our existing relationship with them and an important development in Pembina’s ongoing expansion of its export business,” he said.
According to the statement, the agreement marks a significant first step in Pembina’s remarketing efforts as it expects to reach definitive agreements for the remaining 0.5mtpa of capacity by the end of this year.
The US$4 billion Cedar LNG project remains on time and on budget, with an expected in-service date in late 2028, said the statement.