Shell plans Kitimat natural gas export plant

Shell Canada has joined up with several Asian companies to buy a mothballed industrial plant in Kitimat, B.C., with the aim of using the site to export liquified natural gas to Asia.

Spokesman Stephen Doolan confirmed the company and its Asian partners are in the "early stages" of exploring the  potential of building a new LNG facility at the site, and the company would be making an announcement in the coming weeks.

"We have significant gas operations in B.C. and the LNG exports potential of the West Coast is key to accessing the major markets in the Far East. The Far East is a major growth market," said Doolan.

Shell bought the Kitimat site in partnership with Mitsubishi, China National Petroleum, and Korean Gas. The Methanex plant has been mothballed since 2005, when the company stopped production of methanol at the site.

Kitimat's mayor Joanne Monaghan said she is delighted by the news the companies have bought the town's mothballed Methanex plant.

"We're very happy. I can tell you it's certainly going to be a big nice tax base for us and the people of Kitimat. For awhile I felt like I was the mayor of doom, now I feel like I'm the mayor of "boom."

The project one of several liquefied natural gas plants now proposed for B.C.'s north coast.

The National Energy Board recently granted export approval to another Kitimat LNG project proposed by Apache and Encana, clearing the way for LNG to be shipped out of Kitimat on tankers to Asia as early as 2015.