Gazprom Marketing & Trading USA, Inc. and the Rabaska partners, Gaz Metro, Enbridge Inc. and Gaz de France have signed a Letter of Intent outlining the major terms under which GMTUSA will become an equity partner in the proposed Rabaska liquefied natural gas (LNG) regasification project and contract for 100 percent of the import terminal's capacity. The parties expect to execute definitive agreements before the end of this year.
Using the Rabaska terminal, GMTUSA, a wholly owned subsidiary of OAO Gazprom, expects to import Russian LNG supplied from the Shtokman liquefaction project currently under development by OAO Gazprom, which anticipates initial production of LNG from Shtokman in 2014. The Shtokman gas and condensate field, discovered in 1988, is located in the central part of the Barents Sea, approximately 450 kilometers northeast of the city of Murmansk, Russia. The Rabaska terminal is designed to be capable of receiving, storing and re-gasifying imported LNG with a nominal natural gas send-out capacity of 500 million cubic feet per day.
"The development of new markets and products is key to Gazprom's global energy strategy," said Alexander Medvedev, Deputy Chairman of the Management Committee of OAO Gazprom. "Delivering LNG produced at Shtokman to new Atlantic basin gas markets is keenly important to us, and Quebec and Ontario are attractive markets. Shtokman and Rabaska are two solid projects and the agreement announced today testifies to their significance, both from an economic and energy perspective. We are pleased to announce this progress toward our first major investment in North America, which will form an important component of our global LNG strategy."
"This is definitely a major milestone for Rabaska and its three partners. We are very pleased that Gazprom is joining us in advancing the Rabaska LNG project," said Sophie Brochu, President and CEO of Gaz Metro. "Our collaboration with Gazprom is extremely promising for the future and confirms the viability and competitive strengths of our project. Through this venture, Quebec will be connected to one of the world's largest natural gas fields, which will contribute to diversification of its gas supplies while enhancing Quebec's competitiveness."
"The Rabaska LNG project will deliver the critical infrastructure needed to bring an important new source of natural gas supply to Ontario and Quebec," said Stephen J.J. Letwin, Executive Vice President, Gas Transportation and International for Enbridge. "This new supply will benefit the two provinces' growing number of natural gas consumers, many of whom are customers of Enbridge Gas Distribution, as well as support Ontario's increasing emphasis on natural gas to fuel environmentally responsible power generation. Gazprom's involvement in the Rabaska LNG project gives strong momentum to advancing this project and meeting those needs."
"This major step for Rabaska comes, in particular, as the result of the confident relationships Gaz de France has established both with Gazprom for more than 30 years and with Gaz Metro and Enbridge in Quebec. LNG will bring a growing contribution to the supply of the natural gas markets and we are looking forward to contributing to the success of Rabaska thanks to our 40-year experience in LNG, and to our experience in operating the Montoir-de-Bretagne and Fos-sur-Mer regas facilities in France." said Jean-Marie Dauger, Chief Operating Officer of Gaz de France.
Rabaska has already obtained the key federal and provincial government approvals to proceed with construction of the terminal in Levis. Construction would be timed to meet the anticipated first LNG deliveries in 2014.
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