Pembina and Petronas sign 20-year capacity agreement for Cedar LNG

Pembina, Malaysian energy giant Petronas have signed a 20-year agreement for 1 million tonnes per annum of Pembina’s liquefaction capacity at the Cedar LNG facility on Canada’s West Coast.

Pembina Pipeline Corp. and Malaysia’s Petronas have signed a 20-year agreement covering 1 million tonnes per annum (mtpa) of liquefaction capacity at the Cedar LNG project in Kitimat, British Columbia. The deal provides Petronas with access to additional LNG export capacity from western Canada, while giving Pembina a long-term take-or-pay revenue stream linked to its expanding export business.

The agreement is structured as a synthetic liquefaction service, under which Pembina will supply transportation and liquefaction capacity to Petronas LNG Ltd. The arrangement supports Petronas’ plans to monetize its Canadian natural gas resources and diversify supply to Asian markets, where demand for LNG continues to grow.

“Petronas is a global LNG industry leader and one of the largest gas producers in Canada. This agreement is an extension of our existing relationship and an important development in the ongoing expansion of our export business,” said Stu Taylor, Pembina senior vice president and corporate development officer. “It further validates Cedar LNG and highlights the strong demand for West Coast export capacity, given the advantages of Canadian feedstock and shipping distance to Asia.”

Shamsairi M. Ibrahim, vice president of LNG marketing and trading for Petronas Gas and Maritime Business, said the agreement reinforces the company’s long-term commitments in Canada. “This arrangement improves supply diversity and enhances reliability for customers, while demonstrating our dedication to responsibly monetize our gas resources and deliver reliable, lower-carbon energy solutions to meet Asia’s growing energy needs,” he said.

Pembina previously secured 1.5 mtpa of liquefaction capacity at Cedar LNG in 2024 to support the project’s final investment decision, with plans to remarket a portion of that capacity. The new agreement with Petronas marks the first step in that process. Pembina expects to reach agreements for the remaining 0.5 mtpa by the end of 2025.

Cedar LNG is a partnership between the Haisla Nation and Pembina to develop a floating LNG facility powered by renewable electricity from BC Hydro. The US$4 billion project remains on schedule and on budget, with an expected in-service date in late 2028. The project’s design is intended to achieve one of the lowest carbon intensities among LNG export facilities globally.