Woodfibre LNG Limited has announced that it has issued a notice to proceed to its prime contractor McDermott International.
The company said this notice is an instruction from Woodfibre LNG to McDermott to begin work necessary to advance the Woodfibre LNG project to the start of major construction in 2023. Woodfibre LNG said it expects to achieve a “substantial completion” in 2027.
Powered by renewable hydroelectricity, Woodfibre LNG will be the lowest-emitting LNG export facility in the world, according to Woodfibre LNG. When shipped to Asia where it will replace coal-fired electricity, the LNG produced at the Woodfibre facility will reduce 3.5 million tonnes of CO2 equivalent per year, which is equivalent to 5% of the annual emissions of the British Columbia (BC), the company pointed out.
The Woodfibre LNG project is located approximately four miles west-southwest of Squamish, British Columbia. It includes the construction and operation of an LNG export facility on the site of the former Woodfibre pulp mill. The facility will have a storage capacity of 250,000 square meters and will produce around 2.1 million tonnes of LNG per year, according to Woodfibre LNG.
Woodfibre LNG, which is a subsidiary of Pacific Energy Limited, is a privately held Canadian company based in Vancouver and Squamish.
In November 2021, Woodfibre LNG announced that it had signed an engineering, procurement, fabrication and construction (EPFC) contract with McDermott International. The EPFC contract was described by Woodfibre LNG as an important step in advancing detailed engineering and construction planning before the company issues a notice of suit.
In June 2019, Pacific Oil & Gas Limited disclosed that Woodfibre LNG Export Pte Ltd had signed a binding LNG sale and purchase agreement with BP Gas Marketing Limited. Under the terms of the SPA, BP will receive 0.75 million tonnes per year of LNG over 15 years on a free on board (FOB) basis, with first delivery expected in 2023, Pacific Oil & Gas Limited noted at the time. .
In May 2021, Woodfibre LNG disclosed that it had signed a second LNG SPA with BP Gas Marketing Limited for the delivery of LNG from the Woodfibre LNG export facility. Under the terms of this SPA, BP Gas Marketing Limited will receive 0.75 million tonnes per year of LNG over 15 years on an FOB basis, bringing BP Gas Marketing’s total LNG offtake to 1.5 million tonnes per year.