Malaysia's Petronas considering pipeline investments to monetize Canada gas assets: Bernama

A Petronas logo at their office in Kuala Lumpur, Malaysia August 15, 2017. REUTERS/Lai Seng Sin

KUALA LUMPUR (Reuters) - Malaysia’s Petroliam Nasional Berhad [PETR.UL] is considering investing in a pipeline to market its Canadian gas assets after scrapping plans for a liquefied natural gas (LNG) project in Canada, state news agency Bernama said on Wednesday.

Petronas, as the company is known, would use the pipeline to connect and market natural gas resources from an area of western Canada which has 22.3 trillion cubic feet of proven unconventional gas to the rest of Canada and North America, Bernama said, citing an interview with the company’s upstream Chief Executive Mohd Anuar Taib.

“We are now looking at the possibility of working together with partners or parties to look at a pipeline that could be built to connect that area to the rest of Canadian market,” he said.

Petronas scrapped its proposed $29 billion LNG export terminal in western Canada last month due to weak global prices, in a blow to its ambitions to expand its LNG portfolio beyond Malaysia.

Industry analysts, however, said the decision was expected and would bring the company long-term benefits, as it frees up funds for other domestic projects such as its Refinery and Petrochemical Integrated Development (RAPID) project in Malaysia’s southern state of Johor.

Petronas is looking at buying a 15 percent stake in the LNG Canada project that is led by Royal Dutch Shell and located in British Columbia, Canadian newspaper The Globe and Mail reported on Monday, citing industry sources.

Petronas is also exploring the viability of transporting natural gas through existing pipelines to the U.S. Gulf Coast, the Globe and Mail said.

Petronas did not respond on Tuesday to a request for a comment on whether it is investing in the LNG Canada project.

Reporting by Emily Chow; Editing by Christian Schmollinger