Full Breakdown
LNG Canada Secures Final Investment Decision for Phase 2 Expansion
By Drooid · · How we work
Core Event
On September 29 2026 Prime Minister Mark Carney announced that the Shell-led joint-venture—Shell (40 %), PETRONAS (25 %), PetroChina (15 %), Mitsubishi Corp. (15 %) and KOGAS (5 %)—has taken a final investment decision (FID) to proceed with Phase 2 of the LNG Canada project in Kitimat, British Columbia. The expansion adds two liquefaction trains, a new LNG storage tank, a condensate tank, an additional loading berth and expanded utilities, doubling annual capacity from 14 Mtpa to 28 Mtpa. The privately-funded phase is valued at roughly C$33 billion.
Background & Context
Phase 1 began exporting LNG on June 30 2025 under a 40-year licence. The facility sits on the traditional territory of the Haisla Nation and was among the first projects reviewed by the federal Major Projects Office after its creation in September 2025. In July 2026 the consortium signed an equity-option agreement with MNT Investments LP, a partnership of the economic-development organisations of the Gitga’at, Gitxaala, Haisla, Kitselas and Kitsumkalum Nations, granting the five First Nations a potential C$1 billion stake in a new storage tank.
Data & Statistics
- Capacity: 14 -> 28 Mtpa (doubling).
- Peak construction jobs: up to 4,000 at Kitimat and 2,100 on the Coastal GasLink (CGL) pipeline expansion.
- Long-term revenue: projected > $50 billion in government revenues over the project’s life.
- Export diversification: MEI analyst Gabriel Giguère estimates the expansion could raise Canada’s non-U.S. LNG export share to ? 41 % of total gas exports.
- Steel sourcing: ? 70 % of steel for the new compressor stations will be Canadian; specialised modules for the trains will be fabricated by China Offshore Oil Engineering Co. (COOEC).
Official Statements & Responses
- Chris Cooper, CEO of LNG Canada, called Phase 2 a “nation-building investment” that will create “thousands of jobs” and strengthen Canada’s role as a “trusted energy partner.”
- Cederic Cremers, Shell’s Integrated Gas President, highlighted the project’s “low-cost gas” from the Montney formation and the short Pacific shipping route to Asian markets.
Criticism & Opposition
- Wet’suwet’en hereditary chiefs oppose the new CGL compressor stations, citing lack of free, prior and informed consent and cultural impacts.
- Kitimat residents have raised health concerns over persistent flaring, describing “black smoke” and “tall flames” and urging acknowledgment of emissions impacts.
On-the-Ground Reports
- Rob Campbell, a local contractor, said, “We’ve all been waiting for it, that’s for sure,” noting the anticipated surge in local spending and employment.
Conflicting Reports & Gaps
CBC reports that no tariffs apply to the Chinese-fabricated modules, while LNG Canada states that 70 % of the steel for the new compressor stations will be sourced domestically. The precise split for other components (e.g., storage tanks) is not disclosed, leaving overall domestic content unclear.
What’s Next
- Construction of the new trains, jetty and ancillary facilities is slated to begin in 2027, with peak on-site labour expected in 2028-2029.
- CGL’s Phase 2 compression stations will start building in early 2027 and aim for full operational capacity by the early 2030s.
- Commercial operation of Phase 2 is projected for the early 2030s, pending a permit amendment that would allow higher flaring emissions until a redesign is installed in 2028.