The Nisga’a First Nation and its industry partner, Western LNG, which propose to build the Ksi Lisims LNG plant near Prince Rupert, are buying a permitted but as-yet unbuilt pipeline project from TC Energy (TSX,NYSE:TRP) .
TC Energy today announced it has signed a binding letter with the Nisga’a Nation and Western LNG to sell all outstanding shares in Prince Rupert Gas Transmission Holdings Ltd. and limited partnership interests in Prince Rupert Gas Transmission Limited Partnership (collectively, PRGT). The deal is expected to close in the second quarter of 2024.
The Prince Rupert Gas Transmission (PRGT) project is the 900-kilometre natural gas pipeline that was approved but never built as part of the $36 billion Pacific NorthWest LNG project that Petronas abandoned in 2017.
The project’s environmental certificate is still valid, as are benefits agreements signed with First Nations along the pipeline route.
“PRGT is fully engineered, permitted, and ready to construct,” Western LNG CEO Davis Thames said in a press release. “Our collaboration with TC Energy has given us the benefit of their team’s experience and insight.
“Under our new partnership and leadership model we will build on those learnings and on their work done to date, and we will move this critical project forward with renewed momentum and a fresh perspective.”
Neither TC Energy nor the Nisga’a are revealing how much TC Energy will get for PRGT. TC Energy said the sale fits within its capital spending discipline.
"TC Energy’s strategic priorities are focused on staying within its $6 to $7 billion annual net capital expenditure limit, post-2024, maximizing the value of its assets and further enhancing the strength and flexibility of its balance sheet," the company said in a news release. "This agreement fits with those priorities and more."
The Coastal GasLink pipeline that TC Energy built for the LNG ÎÚÑ»´«Ã½ -- originally projected to cost $6.6 billion -- ended up costing more than twice as much: $14.5 billion.
The Ksi Lisims LNG project is the second one in ÎÚÑ»´«Ã½ to be owned by a First Nation. The Cedar LNG project is owned by the Haisla First Nation. That project is much smaller, in terms of production capacity, than the Ksi Lisims project would be.
At 12 million tonnes of LNG production per annum, it would be nearly as big, in terms of production capacity, as the first phase of the LNG ÎÚÑ»´«Ã½ project.
“Today is a historic day for the Nisga’a Nation and represents a sea change in major industrial development in this country,” Eva Clayton, president of the Nisga’a Lisims Government, said in a news release.
“In taking an equal ownership role in this pipeline, we are signalling a new era for Indigenous participation in the Canadian economy. First Nations are no longer being left behind as generational wealth is built from the resources of our lands. At long last, hope and optimism are returning to Indigenous communities across northern ÎÚÑ»´«Ã½”
The Ksi Lisims LNG project is floating LNG plant proposed to be built within Nisga’a treaty lands at the north end of Pearse Island, north of Prince Rupert. The project is still currently working its way through the BC Environmental Assessment Agency's review process.
