Royal Dutch Shell PLC ("Shell") has made a move to
enter the competition of exporting Canadian natural gas to Asia by
purchasing a marine terminal near Kitimat, British Columbia. Shell
currently has partners in South Korea and Japan that are the
world's top liquefied natural gas buyers. This move is part of
Shell's "early stage" work to determine whether to
construct a LNG export facility to export Canadian resources to
Asia. Shell's newly purchased site is near land where Apache
Corp. and partners are poised to construct a $5 billion-plus export
terminal, a project that received a regulatory license last
week.
Canadian natural gas companies are suffering from low prices as
a result of strong supply from all the recent shale gas discoveries
in the United States. Canada's only export customer for natural
gas is the U.S. and these shipments to the U.S. have been halved in
recent years. However, prices in Asia are far higher than they are
in North America.
