(Releads on LNG plans, adds details on project)
VANCOUVER/NEW DELHI, March 7 Petronas'
plan to build a liquefied natural gas (LNG) terminal on Canada's
Pacific coast edged closer to reality on Friday, as the
Malaysian energy giant secured a third equity and offtake
partner for the massive gas export project.
Petronas said it would sell state-owned refiner Indian Oil
Corp (IOC) a 10 percent stake in its Pacific NorthWest
LNG project, along with a 10 percent stake in the northern
British Columbia shale gas assets that will feed the LNG
India's largest oil refiner also agreed to an offtake deal
for 1.2 million tonnes of LNG each year, or about 10 percent of
the project's annual exports.
Petronas' Pacific NorthWest project is just one of about a
dozen LNG terminals proposed for British Columbia's rugged
Pacific coast, as top global energy firms scramble to build the
facilities to export cheap Canadian gas to hungry Asian markets.
The Malaysian state oil firm, which landed on the scene in
2012 with its C$5.2 billion ($4.7 billion) takeover of Canada's
Progress Energy Resources, has moved quickly to leapfrog its
rivals. It secured an export permit in December and filed its
key environmental documents last month.
Petronas to build a 12 million tonne per year terminal near
Prince Rupert, along the province's north coast, with first
exports in late 2018. The liquefaction and export facilities are
expected to cost up to $11 billion.
Petronas has so far signed on three partners, including
Japan Petroleum Exploration Co Ltd (Japex) and
state-owned PetroleumBRUNEI, and will hold a 77 percent stake
when the IOC deal closes.
IOC and Petronas did not disclose the financial details of
their deal, but the Indian cabinet approved the purchase of the
stake for C$1 billion in February, a government source told
Reuters at the time.
Indian companies, like their Asian peers, have been scouting
for oil and gas assets abroad to meet rising domestic demand.
India's gas demand will rise to 466 million cubic metres per
day (mcmd) in 2016/17 ending March 31 from 286 mcmd in
2012/2013, according to government estimates, while its supply
will be only half that amount.
IOC said the super-cooled gas it takes from the Canadian
facility each year will meet some of the requirement of its
planned 5 million tonne a year Ennore LNG import terminal in
Jefferies India Private Ltd acted as sole financial adviser
for IOC on the deal, while Stikeman Elliott LLP was its legal
($1 = 1.0965 Canadian dollars)
(Reporting by Julie Gordon in Vancouver and Aditi Shah in New
Delhi; Editing by Anupama Dwivedi and Marguerita Choy)