Canada is seizing on opportunity created by the Iran conflict to become a leading player in the LNG market. LNG Canada, the country’s first export terminal, is nearing a decision to green-light a Phase 2 expansion, while other LNG projects have seen fresh commercial momentum.
Canada joined the ranks of global exporters nearly a year ago, when LNG Canada exported its first cargo on July 1, 2025. Phase 1 of the project in Kitimat, British Columbia includes two trains with 14 Mtpa (~1.8 Bcf/d) of LNG capacity. LNG Canada is backed by a consortium including Shell (SEL; 40%), PETRONAS (25%), PetroChina (15%), Mitsubishi (15%) and Korea Gas (5%).
After a slow initial ramp, ship-tracking data from Vortexa suggests the facility has ramped to ~87% utilization as of April 2026, exporting nearly 1.6 Bcf/d (see figure). Train 2 started producing LNG in November 2025, boosting activity this year. To put current demand in perspective, Canada’s marketable gas production averaged 19 Bcf/d in 2025, meaning around 8.4% of the country’s production is being exported from the LNG facility.
On June 1, Fluor Corp. (FLR) announced it had received a limited notice to proceed (LNTP) with construction of LNG Canada Phase 2. This follows a joint agreement between the LNG project and the Coastal GasLink owners (TC Energy (TRP), KKR, and the Alberta Investment Management Co.) to double Coastal Gaslink’s capacity to 5 Bcf/d to supply the expansion.
Other British Columbia-based LNG projects are making progress. On May 27, the proposed Ksi Lisims LNG entered a heads of agreement (HOA) with Germany’s Securing Energy for Europe (SEFE) for 1 Mtpa of LNG (133 MMcf/d) for up to 20 years. The HOA is an initial step to commercializing the project, as Ksi Lisims’ proposed capacity is 12 Mtpa (~1.6 Bcf/d).
Smaller LNG Projects Move Forward
While LNG Canada and Ksi Lisims are the country’s most ambitious export projects, several smaller LNG ventures are also advancing on Canada’s Pacific coast (see project map above).
Pacific Energy (70%) and Enbridge (ENB; 30%) are developing Woodfibre LNG near Squamish, British Columbia. BP has an offtake agreement for 100% of the output from the 2.1 Mtpa (~280 MMcf/d) project. McDermott International, the project’s engineering, procurement and construction (EPC) contractor, began construction work in 2023, and substantial completion is expected by 2027.
Pembina (PBA; 50%) and the Haisla Nation (50%) are also pursuing the Cedar LNG project under a joint venture. Planned near Kitimat, Cedar LNG would be Canada’s first floating LNG (FLNG) facility.
The partners reached a final investment decision in June 2024 on the 3.3 Mtpa (~440 MMcf/d) project. Cedar LNG has signed sales contracts with ARC Resources, PETRONAS and Ovintiv (OVV). The marine terminal and a pipeline linking Cedar LNG to the larger pipeline network are both under construction today. PBA and the Haisla Nation are targeting startup in 2028.
FortisBC also plans an expansion of the Tilbury LNG facility outside Vancouver. Tilbury had previously been used as a peaking plant to meet local winter heating demand, but an expansion would add 2.5 Mtpa of liquefaction capacity and make exports feasible. If approved, construction is expected to start as early as 2027.
LNG Trade Disruptions Stoke Commercial Interest
The latest announcements from LNG Canada and Ksi Lisims come shortly after the US-Iran conflict upended the global LNG trade.
Iran struck Qatar’s Ras Laffan LNG facility on March 1, damaging two trains and one of its gas-to-liquids facilities. QatarEnergy, the operator of Ras Laffan, said 12.8 Mpta (~1.7 Bcf/d) of LNG capacity was taken offline, and estimates repairs will take 3-5 years to complete.
The Strait of Hormuz closure also forced QatarEnergy to declare a force majeure that remains in effect today. At 77 Mtpa (~10 Bcf/d), Ras Laffan is the world’s largest liquefaction complex, and the loss of supply has sent gas prices surging across Europe and Asia.
Taken together, the developments highlight a significant opportunity for Canada in global natural gas markets. LNG Canada has demonstrated that Canadian projects can be successfully executed while creating meaningful new demand for the country’s vast gas resources. Meanwhile, early construction activity for LNG Canada Phase 2, as well as progress at the Woodfibre and Cedar LNG projects, suggest additional export capacity is moving closer to reality.
Moreover, Ksi Lisims’ recent HOA with SEFE shows that Canada has opportunities to deliver LNG beyond Pacific markets. The loss of Qatari cargoes, coupled with Europe’s determination to wean off Russian gas, opens a commercial window with a reliable, politically stable LNG supplier.
If all the LNG projects envisioned in British Columbia proceed, Canada could potentially export up to 6.3 Bcf/d by the early 2030s, equivalent to one-third of its 2025 gas production. Combined with the success of LNG Canada Phase 1, these projects position Canada to become an increasingly important contributor to global energy security and a major source of demand growth for the Western Canadian Sedimentary Basin through the next decade. – Alec Gravelle Tickers: BP, ENB, FLR, OVV, PBA, SEL, TRP.
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