Petro-Canada & Gazprom Sign MOU for LNG Project

Petro-Canada's President and Chief Executive Officer, Ron Brenneman, and Gazprom's Management Committee Chairman, Alexey Miller signed a Memorandum of Understanding (MOU) to investigate a joint liquefied natural gas (LNG) project which would see LNG from Russia shipped to North American markets by 2009.

The MOU encompasses a cooperative study of all aspects of the LNG value chain including liquefaction, re-gasification and the supply-demand fundamentals relevant to marketing arrangements. The MOU includes the potential for further co-operation in both Russia and North America on exploration and production, re-gasification and marketing. Specifically, the MOU covers options for Petro-Canada and Gazprom to jointly develop a liquefaction plant in the St. Petersburg region, and investigate options for gas supplies to that LNG plant and re-gasification in North America.

These collaborative efforts leverage both companies' strategies and capabilities. Petro-Canada's strategy is to build a global, integrated LNG business which will add long-life producing assets to its portfolio, and enhance its long-term supply and marketing presence in North America. The company recently announced a joint agreement to pursue the development of the Cacouna Energy re-gasification facility in Quebec, Canada. The proposed facility will be capable of providing 500 million cubic feet of natural gas per day (five billion cubic meters per year) to markets in Canada and the United States.

Ron Brenneman said, "This is both the right time and the right opportunity to advance Petro-Canada's presence in the full LNG value chain. This MOU is a critical first step in achieving a long-term business relationship with Gazprom in support of our growth strategy."