On Monday, a tanker named GasLog Glasgow left Kitimat, B.C. for Asia carrying the first cargo of liquefied natural gas (LNG) from Canada’s West Coast.

This is a major milestone for the energy sector and the Canadian economy. Canada is the fifth largest natural gas producer in the world, but has not been exporting to markets outside the U.S. and Canada.

The shipment comes 15 years after the application to export LNG from B.C. was submitted to the federal government.

LNG Canada made a final investment decision to build Canada’s first large-scale LNG export facility in October 2018. Fed by the new Coastal GasLink pipeline, the facility has a 40-year export license and a total capacity of 14 million tonnes per year. A second phase of the project that would double its capacity is under consideration.

The Haisla Nation was a key joint venture participant in the project, highlighting the importance of strong Indigenous partnerships to energy sector development in Canada.

The U.S. quickly emerged as the world’s largest exporter of LNG, followed by Australia and Qatar.

The importance of Canadian gas making its way to Asia is three-fold:

1) It diversifies Canada’s natural gas industry’s international customer base away from what was once essentially just the United States.

2) It will help balance the oversupplied North American natural gas market. This, combined with growing demand for gas-powered electricity generation, will support stronger prices for Alberta natural gas.

3) It will increase Canadian exports and help Asia reduce its dependency on higher-emitting coal.

In addition to LNG Canada, Cedar LNG is constructing a US$3.4 billion floating LNG facility with operations to begin as early as 2028; Woodfibre LNG is constructing a natural gas liquefaction and export facility near Squamish; and Rockies LNG Partners is collaborating with the Nisga’a Nation and Western LNG to develop the Ksi Lisims LNG floating liquefaction project north of Prince Rupert.

While the Canadian energy sector remains heavily dependent on the U.S. market, the latest news on LNG is part of a recent shift towards Asia that we have been tracking closely. Oil exports to Asia have jumped following the completion of the Trans Mountain Expansion project. Since 2019, propane shipments to Japan and South Korea have surged following the completion of export infrastructure at Ridley Island.

Answer to the previous trivia question: Dr. Roberta Bondar was the first Canadian female astronaut.

Today’s trivia question: Which year’s Calgary Stampede holds the record for the highest attendance?