The LNG Canada project, led by Shell, has officially produced its first liquefied natural gas (LNG), marking a major milestone for Canada’s energy industry and establishing the country as a new player in the global LNG export market.
The facility, located in Kitimat on Canada’s Pacific coast, is now preparing to load its first export cargo, expected by mid-2025, according to project officials. When fully operational, the terminal will have the capacity to export 14 million tonnes per annum (mtpa) of LNG.
First of Its Kind on North America's Pacific Coast
LNG Canada is the first large-scale LNG facility in Canada to reach production and also the first major LNG plant in North America with direct access to the Pacific Ocean, offering a significant shipping advantage to Asian markets compared to U.S. Gulf Coast exporters.
The facility's initial output comes from Train 1, which has a planned capacity of 5.6 mtpa, though it is currently operating at half capacity due to technical issues in one of its processing lines, according to sources familiar with the operation.
First Cargo Expected by June 29
The LNG tanker Gaslog Glasgow is en route to Kitimat and is expected to arrive by June 29, where it will be loaded with LNG, signaling the start of Canada's large-scale LNG exports. This shipment will mark the official entry of Canadian gas into the global LNG supply chain outside of the U.S.
Joint Venture and Strategic Impact
LNG Canada is a joint venture between energy giants Shell, Petronas, PetroChina, Mitsubishi Corporation, and Kogas. Its operation is expected to have significant implications for North American gas markets.
With LNG Canada now providing a new export outlet, analysts and traders expect a decline in Canadian natural gas exports to the United States, which has long been the country’s sole gas buyer.
Canadian LNG Ambitions Expand
LNG Canada’s commissioning comes as two additional Canadian Pacific coast export terminals—Woodfibre LNG and Cedar LNG—continue construction, both targeting completion between 2027 and 2028. These projects reflect Canada’s growing ambition to tap into the booming global LNG market, especially in Asia.
Background: Canada’s Gas Export Landscape
Canada exported an average of 8.6 billion cubic feet per day (bcfd) of gas to the U.S. in 2024, up from 8.0 bcfd in 2023 and higher than the five-year average of 7.5 bcfd (2018–2022), according to data from the U.S. Energy Information Administration. However, this is still below the 2002 peak of 10.4 bcfd.
As new export terminals come online, Canada is expected to diversify its gas trade away from the U.S. pipeline-dependent model, enhancing global energy security and positioning itself as a reliable LNG supplier.
Conclusion
The successful start of LNG Canada’s production marks a historic leap for Canadian energy exports, one that aligns with shifting global energy demands and strategic interest in diversifying gas supply routes. While operational teething issues remain, the project’s launch sets the stage for a new era in North American LNG.