$15.7 billion floating LNG project on Canada’s horizon as Kanata partners with Hanwha Ocean

South Korea’s Hanwha Ocean has signed a non-binding memorandum of understanding (MOU) with Kanata Clean Power & Climate Technologies Corp. to explore potential cooperation on a proposed development of a floating liquefied natural gas (FLNG) export project planned for Prince Rupert, British Columbia, Canada.

This strategic memorandum of understanding enables the partnership to contemplate collaboration on engineering, construction, operations, investment and LNG offtake for the proposed Kanata LNG project at Prince Rupert, British Columbia. Kanata estimates total capital expenditures for the project at approximately $15.7 billion, subject to final engineering, commercial arrangements and regulatory approvals. This FLNG export project is expected to have a capacity of up to 12 million tonnes per annum (mtpa).

Under the terms of the MOU, Hanwha Ocean and Kanata intend to explore potential opportunities for cooperation across several technical and commercial areas, including engineering and construction of FLNG production and related facilities; operations and maintenance services over the facilities’ operating life; strategic equity participation by the Korean firm or affiliated entities; long-term LNG purchase arrangements; and midstream solutions, including LNGC, LNG and more.

Philippe Levy, President of Hanwha Ocean’s Energy Plant Unit, commented: “Canada has world-class natural gas resources and strong long-term potential to support reliable LNG supply to Asia-Pacific markets. We are pleased to establish this strategic relationship with Kanata and to explore how Hanwha Ocean’s FLNG, offshore engineering, construction, and marine energy capabilities could contribute to the proposed Kanata LNG project.

“Hanwha Ocean has extensive experience delivering complex offshore energy facilities and believes floating LNG can offer a flexible and scalable pathway for new LNG export developments where the technical, commercial, environmental, and regulatory conditions are properly aligned. This MOU is an important first step. Significant work remains before any final investment or project execution decision can be made, and we look forward to working with Kanata to evaluate the opportunity in a disciplined and responsible manner.”

Kanata LNG, which is being developed as a floating LNG export facility located near Prince Rupert, North America’s closest Pacific port to Northeast Asia, is intended to leverage modular construction and marine-based liquefaction technology to provide scalable export capacity.

Robert F. Delamar, Chief Executive Officer of Kanata Clean Power & Climate Technologies, said: “We are delighted to welcome Hanwha Ocean as a strategic partner in Kanata LNG through this memorandum of understanding. Hanwha brings globally recognized capabilities in floating infrastructure, shipbuilding and energy systems, making it an outstanding collaborator as we advance the project.”

Kanata has also offered participating First Nations the opportunity to acquire up to a 50% ownership interest in the project, subject to negotiations, financing arrangements and applicable approvals.

The proposed Kanata LNG project remains subject to numerous approvals and conditions, including environmental assessments, engagement with Indigenous communities, regulatory approvals and the negotiation and execution of definitive commercial agreements.

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