Canada's West Coast LNG Export Capacity Eyes European Market
European buyers are exploring the possibility of purchasing liquefied natural gas from Canada's Pacific coast and shipping it through the Panama Canal as part of a long-term strategy to diversify supply.
The interest in Ksi Lisims LNG, a proposed export terminal, is significant, with state-owned German energy group Uniper among the potential customers who have had commercial talks with its backers.
Canada's existing and emerging LNG export capacity is located on the country's west coast, making it geographically more suited to supplying Asia. However, tolls and shipping time through the Panama Canal will increase costs for European buyers.
The Iran war has made it increasingly likely that Ksi Lisims gets built, with Western Canadian natural gas prices continuing to lag behind the U.S. benchmark, making a strong business case for Canadian LNG.