Export licences are required from the National Energy Board (NEB) whenever oil or natural gas is proposed to be exported for a term exceeding two years. Historically, export licences were used to export natural gas from Canada to major utilities in the United States under long-term purchase and sale contracts.
Kitimat LNG Project
Kitimat LNG terminal will connect to the Pacific Trails Pipeline (PTP), which is a proposed 1.4 Bcf/d pipeline running approximately 463 kilometres from the export terminal to Spectra Energy's existing pipeline network, which ties into the broader North American natural gas grid. The proponents of both the Kitimat LNG terminal and the PTP are partnerships between Apache Canada, EOG Resources Canada and Encana Corporation.
Kitimat LNG partners Apache Canada Ltd. (Apache Canada) and EOG Resources Canada Inc. (EOG Canada) have agreed to purchase the 50 percent interest in the Pacific Trail Pipelines Limited Partnership (PTPLP) they do not own from Pacific Northern Gas Ltd. (PNG) for $50 million. Apache Canada and EOG Canada will pay PNG $30 million on closing – expected by the end of February – and a second payment of $20 million when the purchasers decide to proceed with construction of the Kitimat liquefied natural gas (LNG) export facility.
Acquiring the PTP is an important step in building a comprehensive system that will enable Apache and EOG to tap Asian markets for our abundant natural gas resources in the Horn River Basin and elsewhere in Western Canada.
PNG will operate and maintain the planned pipeline under a seven-year agreement with Apache Canada and EOG Canada with provisions for five-year renewals. Apache Canada and EOG Canada also agreed to 20-year transportation service arrangements requiring them to use a portion of PNG's current pipeline capacity.
About Apache Canada Ltd.
Apache Canada Ltd., a subsidiary of Apache Corporation (NYSE:APA)(NASDAQ:APA), is one of Canada's top oil and gas producers with operations in Alberta, British Columbia and Saskatchewan.
About EOG Canada
EOG Resources Canada Inc. is a wholly owned subsidiary of EOG Resources, Inc., one of the largest independent (non-integrated) oil and natural gas companies in the United States with proved reserves in the United States, Canada, Trinidad, the United Kingdom and China. (Mondaq, 10/17/2011, Marketwire, 2/7/2011)