Sinopec wants Canada LNG export terminal

File picture shows a Chinese New Year lantern installation on display outside a Sinopec gas station in Hong Kong. [Photo / Agencies]

China Petrochemical Corp, the country's largest refiner, is looking to build a liquefied natural gas export terminal in British Columbia on Canada's west coast, the province's premier said on Wednesday.

"Sinopec is now seriously pursuing investment for one or more projects in our province," Christy Clark, British Columbia's premier, said during a recent visit to China to discuss cooperation opportunities in LNG development with top Chinese gas and oil companies. "It is one of the most recent LNG proposals in BC."

An earlier report by The Wall Street Journal said that China Petrochemical Corp is in talks with the US-based oil and gas producer Apache Corp to buy a minority stake in an LNG project in Kitimat, a coastal town in British Columbia, including an LNG processing plant, pipelines and more than 260,000 hectares of undeveloped shale resources.

Although the size and value of the stake hasn't been determined, Sinopec's investment would go toward paying for the cost of the project. Apache last year pegged the cost at $15 billion, the report said.

A spokesman for Sinopec in Beijing declined to comment on the matter on Wednesday.

Sinopec owns significant natural gas properties in two of Canada's most prominent shale-gas fields that, once developed, could feed into Pacific Coast LNG plants.

Canada is keen to move gas exports into potential Asian markets such as China away from the US market where the need for imports of natural gas from Canada has been reduced because of its shale gas revolution.

According to Clark, LNG could create a trillion-dollar economic opportunity and 100,000 jobs. Its revenues could also play a major part in eliminating the province's current $62 billion debt within 15 years.

"We are here representing every sector required to import BC liquefied natural gas, including bankers, investors and oil and gas companies to welcome Chinese companies, to invest in our province," Clark said.

She said they are placing their economic destiny side by side with Chinese companies with the province's exports of goods to China having increased more than 500 percent over the past decade.

There are more than 10 proposed LNG projects in British Columbia, three of which already have approved export licenses. Since last year, companies have invested more than $6 billion in British Columbia to acquire upstream natural-gas assets and secure the development of pipelines and LNG plants, according to a statement by the province.

China's CNOOC Ltd, PetroChina Co Ltd and Sinopec Group, Malaysia's Petronas and South Korea's Kogas are all racing to build expensive facilities to ship cheap natural gas produced in the province back to Asian markets.

Petronas has made a $36 billion promise to invest in British Columbia's liquefied natural gas plant and pipeline project, the largest foreign direct investment ever in Canada.

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