Shell Canada Energy gave a green light to start work on LNG Canada, a liquefied natural gas project in Kitimat, Canada.

Shell holds a 40% working interest in the project and its approval means that construction may begin. First LNG shipments to markets in Asia are expected before 2025, and the project could cost anywhere from $14 billion to $18 billion.

LNG Canada is intended to export LNG from two processing units, or “trains,” totaling 14 million tonnes per annum (mtpa), with the potential to expand to four trains. It has access to natural gas from British Columbia and claims relatively short shipping distances to north Asian markets as well as the ability for ships to avoid the Panama Canal.

LNG Canada is a joint venture made up of Shell Canada Energy and units of Petronas (25%), PetroChina Company Limited (15%), Mitsubishi Corp. (15%) and Korea Gas Corp. (5%). Each joint venture participant will be responsible for providing its own natural gas supply and will market its own LNG.

TransCanada Corp. will build, own and operate the Coastal GasLink pipeline to connect upstream gas supplies to the LNG plant.

The joint venture of JGC-Fluor Corp. will provide project engineering, procurement and construction (EPC) services. The LNG Canada plant will be constructed under a single lump-sum contract at an estimated cost of around $1,000 per tonne of LNG. Construction will be a modular LNG train designed and built in Asian yards.