REFILE-UPDATE 1-Japex to take 10 pct stake in Petronas' Canada shale gas project

Mon Mar 4, 2013 4:07am EST
 
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* Japex to take 10 pct stake in 12 mtpy LNG project

* Aims to export 1.2 mln tpy of LNG to Japan

TOKYO, March 4 (Reuters) - Japan Petroleum Exploration (Japex) is taking a 10 percent stake in an integrated shale gas development and liquefied natural gas (LNG) project being planned by Malaysia's Petronas in Canada's British Columbia province.

Japex said on Monday it is considering marketing its LNG offtake from the 12 million tonnes per year (mtpy) Pacific Northwest LNG project, worth 1.2 mtpy, in Japan, the world's largest importer of LNG, which has been increasingly reliant on LNG since the Fukushima disaster in 2011 knocked out much of its nuclear power capacity.

Japanese firms have been investing in shale gas projects in North America to export cheaper LNG to Asia. Asian LNG long-term prices are typically oil-linked, making them pricier than LNG from the United States, where the country's shale gas boom has helped lower natural gas prices.

Japex declined to comment on the value of the deal, which involves a 10 percent stake in a shale gas block in North Montney region, which is currently selling gas in Canada, and a stake in a liquefaction plant in Lelu Island near the Port of Prince Rupert on the country's Pacific coast.

Petronas, which would hold the remaining 90 percent of the project, is set to make a final investment decision to build the LNG plant, comprising 2 plants with capacity of 6 mtpy each, at a cost of C$9 billion-C$11 billion ($9 billion-$11 billion) at the end of 2014, with commercial launch at the end of 2018.

Petronas is expected to sign a contract with TransCanada soon so that the Canadian firm would build a 750-km (470-mile) pipeline between the shale gas block and LNG plant, Japex said.   Continued...