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Pembina Approaches Investment Decision on $4 Billion LNG Project

Pembina Pipeline Corp. plans to finalize its investment decision for the Cedar LNG floating gas-export project in British Columbia within the next two weeks, according to sources familiar with the situation.

The $4 billion project is expected to be funded with 60% debt and 40% equity. The equity portion will see contributions from both Pembina and its partner, the Haisla Nation, each providing 20%, Cedar LNG stated in an emailed message to Bloomberg News.

The financing package includes a $1.5 billion (US$1.09 billion) five-year term loan to fund a pipeline connecting the Cedar terminal with the nearby Shell-led Kitimat project, sources said.

Cedar LNG will be the second Canadian fuel-export project to reach financial sanctioning, following the $40 billion LNG Canada project led by Shell, which made its investment decision in 2018.

Approximately 15 banks are expected to participate in financing the project, though Cedar LNG did not confirm the number of banks involved or provide specific timing for the final investment decision when contacted by Bloomberg News.

The project developers, which include the Haisla First Nation, previously targeted mid-2024 for the final investment decision. The proposed 3-million-metric-ton-per-year facility will have its liquefied natural gas offtake divided between Pembina and Canadian exploration firm ARC Resources Ltd.

The most recent LNG export facility to reach a final investment decision was the Ruwais LNG project by Abu Dhabi National Oil Co., announced Wednesday.

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