LNG

Petronas flags Canadian LNG exit

MALAYSIAN petroleum giant Petronas has threatened to abandon the $US10 billion ($A11.4 billion) Pacific Northwest LNG project it operates in Canada over regulatory delays and tax uncertainty.

Petronas flags Canadian LNG exit

Petronas CEO Shamsul Abbas revealed this stance in an interview with London's Financial Times.

"Rather than ensuring the development of the LNG industry through appropriate incentives and assurance of legal and fiscal stability, the Canadian landscape of LNG development is now one of uncertainty, delay and short vision," he told the newspaper.

Abbas also doubted whether a final investment decision could be achieved by the end of this year.

British Columbia Premier Christy Clark was not concerned about the comments, according to the Vancouver Sun.

"We're negotiating and this is part of negotiations," Clark said at a meeting with Chinese delegates from Guangdong province in Vancouver on Thursday.

"What Petronas is doing is standing up and trying to get the absolute best deal they can get for their shareholders … and we're trying to get the best deal for British Columbians. That's the process."

She said there were still 15 other companies hunting for LNG resources in Canada.

"I am very hopeful the Petronas deal is going to go ahead - ultimately, the decision is in their hands," she told the newspaper.

Abbas is due in Canada later this week.

According to Reuters, the BC provincial government has promised to unveil "LNG tax" legislation in October and approve it by late November.

Considered at the front of the nation's LNG project pack, along with the Royal Dutch Shell-operated LNG Canada venture, the Pacific Northwest project in British Columbia is in the front-end engineering and design phase, with first LNG exports targeting 2018.

The proposed plant is targeting 12 million tonnes per annum through two trains, with a third train expansion option on the site.

Petronas has a 62% stake in the Canadian LNG project.

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