Proposed B.C. LNG project seals German supply deal

British Columbia’s Ksi Lisims LNG has reached a deal with a German state-owned company, marking Canada’s first LNG deal with a European country.

Securing Energy for Europe (SEFE) will buy one million tonnes of LNG annually for up to 20 years, starting in the early 2030s.

Federal Natural Resources Minister Tim Hodgson said in Vancouver on Wednesday that Germany is looking to diversify its supply of LNG due to Russia’s invasion of Ukraine and conflicts in the Middle East. 

“When Germany looked at where it can find sources of LNG, it looked at relative economics and saw British Columbia as an attractive place to have new sources of LNG,” said Hodgson. 

Ksi Lisims has so far mainly targeted markets in Asia, and has already signed two other 20-year deals with Shell and TotalEnergies.

Once operational, the facility would be able to export about 12 million tonnes of liquefied natural gas a year.

The project is being advanced by a partnership of the Nisga’a Nation, Rockies LNG and Texas-based Western LNG.

Nisga’a President Eva Clayton said the deal highlights what can be accomplished with strong partnerships with First Nations. 

“From Berlin to Beijing, the world needs more of what Canada has – stable, secure energy in an increasingly uncertain world,” she said. 

The planned floating export facility off the coast of northwest B.C. has received regulatory approval from the provincial and federal governments, but is still awaiting a final investment decision. 

Premier David Eby said at the Western Premier’s meeting in Alberta on Tuesday the German deal marks a major step toward that goal.

Ksi Lisims was referred to the federal Major Projects Office last November for potential fast-tracking. The project is also on the B.C. government’s list of priority projects under its “Look West” economic strategy.

In January, B.C. signed a memorandum of understanding with Ksi Lisims LNG to provide up to 600 megawatts of electricity to the facility through the planned $6‑billion North Coast Transmission Line.

The project has faced criticism from the B.C. Greens and environmental groups over its U.S. part-ownership and alleged greenwashing of LNG production.

Ksi Lisims would also be reliant on the Prince Rupert Gas Transmission pipeline, which faces opposition and legal challenges from other First Nations.

First Nations, including the Lax Kw’alaams Band and Metlakatla First Nation, have alleged there was a failure to adequately consult and address their concerns about the Ksi Lisims and pipeline projects.

Grand Chief Philip Stewart, with the Union of British Columbia Indian Chiefs said in a statement that LNG expansion threatens Canada’s climate commitments and economic stability.

“Canada cannot claim to be advancing reconciliation while continuing to fast-track massive fossil fuel projects without addressing the concerns and opposition of all impacted First Nations,” said Stewart.

B.C. Green Leader Emily Lowan said Wednesday’s announcement amounted to “industry boosterism” for a project that she said is still a long way from fruition.

“In the global picture, all estimates look toward a global supply glut of LNG by 2030, and so B.C. will be the highest cost late market entrant to that picture,” said Lowan. “I think we’re just beelining toward stranded assets.”