Growth prospects firmed up for liquefied natural gas (LNG) exports from British Columbia (BC) on Tuesday as Calgary-based Pembina Pipeline Corp. agreed to buy a half-stake in Cedar LNG.

Pembina agreed to take 50% ownership and an operator role in Cedar, crafted by the Haisla Nation. The initial commitment is C$112.5 million ($90 million) to cover initial planning and regulatory costs. Pembina is acquiring stakes owned by PTE Cedar LP and Delfin Midstream Inc.

The estimated C$3 billion ($2.4 billion) proposal, under review by the BC Environmental Assessment Office, calls for exporting 400 MMcf/d from a floating plant near the LNG Canada terminal underway in Kitimat.

“We believe environmental stewardship,Indigenous prosperity and inclusion, and mutual economic benefit are the cornerstones of future energy infrastructure development in Canada,” Pembina Vice President Stu Taylor said.

Haisla chief councilor Crystal Smith predicted Cedar would bring “tremendous economic opportunities and benefits ensuring the Haisla people have control of our own future.”

Cedar has secured its gas by making a long-term service deal with LNG Canada supply pipeline Coastal GasLink, now under construction across 670 kilometers (400 miles) of northern BC from the prolific Montney Shale.

Pembina officials noted that the Haisla Nation has a “well advanced” project as a result of regulatory and engineering work done to date. Cedar has scheduled a final investment decision for 2023, with deliveries potentially beginning in 2027.

“Cedar LNG is based on a proven, simplified design utilized in other floating liquefaction projects, enabling lump-sum turnkey contracting for the majority of the project’s costs,” said Pembina and the Haisla Nation. “As a result, Cedar LNG represents among the lowest cost LNG value chains for delivery into the Asian market.”

The project in part could compensate for the recent cancellation by Chevron Corp. and Woodside Petroleum Ltd. of the Kitimat LNG project, which had planned to export up to 1.3 Bcf/d. It was shelved as too costly, with an uncertain economic future.

It could also compensate for Pembina’s Jordan Cove LNG project in Oregon, which has been placed on pause because of regulatory setbacks. 

The Canadian Energy Research Institute (CERI) estimated the country is capable of exporting up to 4.9 Bcf/d of LNG, chiefly from BC. LNG Canada alone would achieve more than half of the potential, with a 40-year export license for 3.5 Bcf/d.