Exxon says Canada LNG plans to cost up to C$25 billion

Mon Jan 12, 2015 12:48pm EST
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(In U.S. dollars unless noted)

CALGARY, Alberta Jan 12 (Reuters) - Exxon Mobil Corp and its Canadian affiliate Imperial Oil Ltd plan to spend up to C$25 billion ($21 billion) on a liquefied natural gas facility on British Columbia's northern Pacific coast, the two companies said in documents filed with the province's environmental regulator.

The WCC LNG project will produce an initial 15 million tonnes of LNG per year from a plant at Prince Rupert, 756 km (470 miles) northwest of Vancouver, they said in a Jan. 8 filing to the B.C. Environmental Assessment Office.

WCC LNG, co-owned by Exxon and its majority-owned Imperial Oil unit, is one of 18 LNG projects proposed for northern British Columbia to supply gas to Asian buyers, including rival ones led by Royal Dutch Shell Plc and Malaysia's Petronas.

However high costs and uncertain economics due to falling oil prices have slowed development in the region, with Petronas in December delaying a final investment decision on its $11 billion Pacific NorthWest LNG project while it looks for cost savings.

Imperial, Canada's No.2 integrated oil and gas producer, said it expects to receive all needed regulatory approvals for the project by 2017. After those are in hand, the two companies will decide on whether to build the facility.

"We're looking at an in-service date beyond 2023," said Pius Rolheiser, a spokesman for Imperial.

According to the filing, the initial phase of the project will cost between C$15 billion and C$25 billion. It could also be expanded to produce up to 30 million tonnes if needed.

($1 = 1.1926 Canadian dollars) (Reporting by Scott Haggett; Editing by James Dalgleish)