Question Period Note: Kitimat LNG Cancellation

On March 17, 2021, Chevron Canada announced that it would cease funding Kitimat LNG project feasibility work. The company announced in December 2019 that it plans to exit its 50 percent working interest in the Kitimat LNG Project in British Columbia, as part of global portfolio optimization efforts. Chevron’s other assets in Canada are not included in this decision.
Australia’s Woodside Energy – which also has a 50 percent interest in the project – indicates it continues to have confidence in the project, and will work with Chevron to determine mutually acceptable means of advancing the project as Chevron exits. Woodside continues to work with stakeholders to improve the project’s cost competitiveness. Chevron will remain as operator of the project until its exit from the project or transfer of operatorship.

• While the Government of Canada is disappointed by Chevron Canada’s announcement, we believe this project has great potential.
• Canadian LNG presents tremendous economic opportunity for Canadians, and the government will continue to support good LNG projects that will create jobs for local communities, Indigenous partners, and Canadians across the country, while also helping the world transition to a low-carbon energy future.
• This includes the $40 billion LNG Canada project – the single largest private sector investment in Canadian history, which will create 10,000 jobs at the height of construction.
• We will continue to work with the government of British Columbia and the project proponents going forward.

Supplemental Messages
• We are working to ensure that Canada becomes the world’s cleanest producer of LNG, and have already put in place a number of measures to support LNG, including low business taxes, 40-year export licenses and accelerated capital cost incentives for LNG facilities until 2025.
• We will continue to work with industry, provincial and territorial governments, and Indigenous communities to ensure the long-term competitiveness of the industry.
• Through Invest in Canada, we will also continue to work with international partners to attract capital for this and other Canadian LNG projects.
If pressed on competitiveness / capital flight:
• Our government has been focused on creating conditions to attract investment and create jobs, including by:
o Building pipeline capacity with the Line 3 replacement, and getting our resources to new export markets with TMX, which is under construction and has 7,000 workers employed.
o We’ve also helped secure the single largest private sector investment in Canadian history – the $40 billion LNG Canada project – and there are hundreds of other major resource projects planned across Canada over the next 10 years.
• Canada is building a stable, competitive and sustainable LNG sector to be a world leader in environmental, social and governance (ESG) performance, in alignment with our pursuit of a net-zero emissions economy by 2050.

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