Photo by: Bloomberg
PERTH (miningweekly.com) – Australian oil and gas major Woodside on Thursday said that the company remained committed to the Kitimat liquefied natural gas (LNG) project, in British Columbia, after US major Chevron announced plans to exit the asset.
Chevron holds a 50% stake in Kitimat.
Chevron earlier this week said that as a result of its disciplined approach to capital allocation and a downward revision in its longer-term commodity price outlook, the company will reduce funding to various gas-related opportunities including Appalachia shale, Kitimat LNG, and other international projects.
Chevron told shareholders that it is evaluating its strategic alternatives for these assets, including divestment.
“We believe the best use of our capital is investing in our most advantaged assets. With capital discipline and a conservative outlook comes the responsibility to make the tough choices necessary to deliver higher cash returns to our shareholders over the long term,” Chevron chairperson and CEO Michael Wirth said.
A spokesperson for Woodside on Thursday told Mining Weekly Online that the company remained committed to the Kitimat LNG project, and will continue to work with all stakeholders to progress the development as part of its post-2027 growth strategy.
“Kitimat LNG has significant advantages, including the potential to be the world’s cleanest LNG project using renewable power from the region’s abundant hydro sources, strong upstream supply options and proximity to growing export markets in North Asia,” the spokesperson said.
Woodside is still reviewing the implications of Chevron’s decision, but said that it would work with any new partner entering the joint venture.
The Chevron-operated asset comprises upstream resource assets in the Liard and Horn River basins, the 471-km Pacific Trail Pipeline, and a natural gas liquefaction facility at Bish Cove near Kitimat.
The Kitimat LNG plant includes up to three LNG trains totalling 18-million tonnes a year, and is an all-electric plant powered by clean, renewable hydroelectricity from BC Hydro.