Friday, March 10, 2017

Petronas considers cooperation with Shell for Ridley Island shipment dock

Petronas is looking to offer Shell the
prospect of joint use for a proposed
shipment dock off Ridley Island
Last week the Globe and Mail outlined a new twist to the proposed Pacific NorthWest LNG project for the North Coast, providing some background on a reported approach by the Malaysian owned energy giant towards the Dutch energy company Shell, suggesting that the two companies might wish to explore joint use of a proposed shipment dock off of Ridley Island.

As we noted on the blog last month, the plan by Petronas to shift its dock ambitions towards Ridley Island is one way that the company is looking to satisfy concerns over the Flora Banks and along the way, reduce costs for the massive project for the region.

The Globe and Mail's Brent Jang provides a glimpse into what Pacific Northwest LNG is considering here, noting that the Malaysian company would pick up the tab for construction of the shipment terminal, offering the prospect of shared used with Shell, if they were to ever move forward with their Prince Rupert plans.

The suggestion that Shell may want to get onboard is a new development however and if it stirs interest for the Dutch company, it could help to give some momentum towards the Prince Rupert LNG proposal that currently is slated for Ridley Island.

That proposed development came of out of the preliminary work of the BG Group, however Shell gobbled the British Gas exporter up as part of a massive purchase that took place in 2015.

Shell officials noted in the Globe report that they are still reviewing the combined Shell/BG portfolio to determine where they may wish to move forward if conditions warrant.

Since that time there has been little public mention of the Ridley Island plans, while Shell had its own focus on the Kitimat area, having recently postponed their Kitimat LNG Canada project for the moment.

Update: Mid afternoon Friday, the Terrace Standard reported that Shell had put its plans for the Prince Rupert project on the shelf, bringing an end to any further development of that proposed development.

Neither Shell, or Petronas have expanded further on the concept of sharing the proposed shipment dock off of Ridley.

Both companies were also in the media spotlight this week on a few other notes.

For the Dutch energy giant it came from news that it was withdrawing from its large investment in the Alberta Oil Sands development near Fort McMurray, selling off it's interests in a 7.25Billion dollar transaction with Canadian Natural Resources Limited a Calgary based energy company.

The acquisition by Canadian natural has been described by financial analysts as a "steal of a deal" in financial publication reports over the last few days.

Canadian Natural joins exclusive 1-million barrels club with what analysts say is a 'stead of a deal'

However, while they are leaving the oil side of the energy picture in Canada, the company reinforced that they are still involved with natural gas options for British Columbia and Alberta, where they continue to hold a significant presence.

Something which will make for a bit of news that will provide a measure of relief for those in the Northwest hoping to see progress when it comes to LNG terminal construction.

Petronas was also providing some items of note for the Canadian media this week, with the  National Post taking note of the latest thoughts on the Pacific NorthWest project, noting that Petronas CEO Datuk Wan Zulkiflee Wan Ariffin still considers the mega project to be worthwhile.

Though, the Malaysian CEO also observes that the total review of the project is still ongoing, with no timeline as to when that process will be over.

You can find more items of interest related to LNG development in the Northwest from our archive page here.

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