Japanese trading giant Itochu Corp. is actively engaged in negotiations for a significant, long-term agreement to procure liquefied natural gas (LNG) from the prospective Ksi Lisims project located on Canada’s northwest coast. This strategic move reflects a broader trend among Asian importers to secure stable fuel supplies amidst evolving energy dynamics.
Sources familiar with the matter, who opted for anonymity due to lack of authorization to engage with the media, revealed that the potential agreement could span several decades, marking a substantial commitment to the project. Notably, this would mark the second major contract for the Ksi Lisims project, following Shell Plc’s earlier signing of a 20-year agreement for LNG purchase from the floating export facility.
Backed by a consortium including the Nisga’a Nation, Rockies LNG, comprising Ovintiv Inc. and Tourmaline Oil Corp., and Western LNG LLC headquartered in Houston, the Ksi Lisims LNG project represents a significant investment estimated at C$9.9 billion ($7.2 billion). With construction potentially commencing this year, the facility aims to become operational by late 2027 or 2028, pending final investment approval.
In response to queries regarding the negotiations, representatives for Ksi Lisims and Itochu declined to comment, while Rockies LNG’s spokesperson remained unavailable for immediate response.
This move by Itochu aligns with Japan’s broader strategic objectives to bolster energy security by diversifying LNG sources. Concurrently, other Japanese trading houses like Mitsui & Co. are also actively exploring investment opportunities in LNG projects globally, such as the proposed export plant in the United Arab Emirates.
As Japan continues to navigate shifting energy landscapes, initiatives like Itochu’s pursuit of long-term LNG contracts underscore the nation’s proactive approach to securing its energy future amidst evolving market dynamics.