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    1. Pipelines & Transportation
    2. LNG

    Pembina Pipeline issues notice to proceed on Cedar LNG project

    April 5, 2024
    Pembina Pipeline and the Haisla Nation, partners in development of the proposed 3.3-million tpy Cedar LNG plant, have advanced the project though a long-term commercial offtake agreement and issuance of a notice to proceed to EPC contractors.
    Rendering from Cedar LNG.
    Artist’s rendering of proposed Cedar LNG floating LNG plant.
    Artist’s rendering of proposed Cedar LNG floating LNG plant.

    Pembina Pipeline and the Haisla Nation, partners in development of the proposed 3.3-million tonnes/year (tpy) Cedar LNG plant, have advanced the project though a long-term commercial offtake agreement and issuance of a notice to proceed (NTP) to engineering, procurement, and construction contractors Samsung Heavy Industries and Black & Veatch.

    The project is a proposed floating LNG plant in Kitimat, BC, within the traditional territory of the Haisla Nation expected to source Western Canadian Sedimentary basin natural gas from the Montney shale. Gas will be delivered via TC Energy Corp.’s 2.1-bcfd Coastal GasLink (CGL) pipeline. A final investment decision (FID) is expected by mid-2024 with an anticipated in-service date in late 2028.

    Pembina secured a 20-year take-or-pay liquefaction tolling services agreement with a fixed toll with ARC Resources Ltd. for 1.5 million tpy. As part of the agreement, ARC Resources will supply Cedar LNG about 200 MMcfd of natural gas via CGL from its production base in the Montney.

    In addition, Pembina has executed an identical bridging agreement with Cedar LNG for 1.5 million tpy. Pembina intends to assign its capacity to a third-party following a positive FID, with commercial offtake discussions continuing with multiple other customers, it said.

    To maintain the development schedule, an NTP has been issued to the EPC contractors to continue the engineering, procurement, and construction for the design, fabrication, and delivery of the project’s floating LNG production unit (OGJ Online, Jan. 5, 2024).

    In a separate release Apr. 5, Baker Hughes said it was awarded an order from Black & Veatch to supply Cedar LNG with electric driven liquefaction technologies. Baker Hughes will supply a range of turbomachinery equipment, including four electric-driven main refrigeration compressors, two electric-driven boil-off gas compressors and six centrifugal pumps. 

    Capital costs for Cedar LNG are estimated at US$3.4 billion (gross), including US$2.3 billion (gross), or about 70%, which is under a fixed-price, lump-sum agreement.

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