Speaking at a CIBC investor conference, David Cornhill said Thursday that the companies pitching LNG export facilities on the West Coast can be broken up into two categories, the first being enormous global firms such as Chevron, Petronas and Royal Dutch Shell that have interests in the natural gas fields themselves.
But Cornhill said it's also "critical" for smaller scale tolling processors, companies that covert natural gas into LNG on behalf of producers for a fee, to be available.
"That way you get the most robust and diverse activity in the Western Canadian basin, which is in the best interest for all of us in the energy business," said Cornhill, whose company is partnering with Japan's Idemitsu Kosan Co. Ltd. on exporting LNG and other petroleum products.
Smaller players can offer greater flexibility and move faster than their larger counterparts, which aren't likely to start shipping LNG until around the end of the decade.
"I think it would be a shame to not see LNG being shipped off the coast of British Columbia in (2016). I think you'll see that generally the bias for the larger projects is later," said Cornhill.
The Canadian Chamber of Commerce, Natural Resources Minister Joe Oliver and others have warned that Canada must get a move on when it comes to exporting LNG or risk losing competitive ground to other global suppliers such as Australia.
Calgary-based AltaGas — with interests in natural gas processing, power generation and utilities — announced a deal with Idemitsu about a year ago to explore shipping liquefied natural gas from B.C. to Asian markets ravenous for new energy supplies. The two are also looking at exporting liquefied petroleum gas, such as butane and propane, across the Pacific.
AltaGas and Idemitsu formed a partnership called Triton LNG and last fall applied to the National Energy Board for an export permit. In its application, the partners said they envisaged a facility capable of processing 2.3 million tonnes of LNG per year.
By contrast, a project led by Malaysia state-owned energy giant Petronas received an NEB licence late last year to export nearly 10 times that amount from a facility costing between $9 billion and $11 billion.
Cornhill said the Triton partners will have more details on the project's cost and scope around mid-year.
Japan is Asia's biggest consumer of LNG, gas that has been chilled into a liquid state so that it can be more easily transported overseas by tanker. That need has grown since March 2011, when an earthquake and tsunami triggered a nuclear crisis at the Fukushima Daiichi power plant, prompting the country to look at other sources of energy.
Meanwhile, North America is awash in natural gas from emerging shale formations, like those in northeastern British Columbia. The supply glut has depressed prices, causing many companies to look at ways to export the gas to markets where the price is several times higher.
Follow @LaurenKrugel on Twitter