On Feb. 3, 2012, government released British Columbia's Natural Gas Strategy: Fuelling B.C.'s Economy for the Next Decade and Beyond concurrently with the government's Liquefied Natural Gas (LNG) Strategy.

A primary goal: to attract investments necessary for capital planning, market diversification and the development of a LNG industry.

Since last year, investments over $6 billion have been made to acquire upstream natural gas assets and execute strategic corporate acquisitions, including joint ventures that will anchor the development of pipelines and LNG plants in B.C.

The significant investments made include:

• A $2.9-billion investment made by Mitsubishi Corporation for a 40 per cent interest in an underdeveloped area of the Montney-formation. This investment was part of a deal with EnCana Corporation, known at the Cutback Ridge Partnership. Mitsubishi invested in 40 per cent of the 165,500 net hectares of underdeveloped land.

• A shale gas joint venture agreement between Nexen Inc. and Inpex Corporation for $700 million. The deal resulted in Nexen holding 60 per cent of the operating interest in the joint venture lands, located in Horn River, Cordova and Liard basins of northeast B.C. With the strategic development deal in place, the two companies are now looking into the possibility of building a liquefied natural gas (LNG) export operation.

• A joint venture partnership between China National Petroleum Corporation (CNPC) and Shell Canada, for the development of the Groundbirch area in B.C.'s Montney natural gas play. This investment deal was for approximately $1 billion.

• Petronas, an experienced LNG operator, committed $1.07 billion to develop shale gas in northeastern B.C.'s Montney region. Later in the year, the company announced the Pacific Northwest LNG facility along with their acquired partnership of Progress Energy.

In addition to the $6 billion invested by industry to facilitate LNG development, government estimates up to $1 billion has been spent to prepare for engagements activities, land preparations and planning.

These Industry expenditures are in addition to the investments calculated by The Canadian Association of Petroleum Producers (CAPP). CAPP reports out on industry investments - represented by capital expenditures in exploration and production - on an annual basis. The total amount of industry investment during the 2012 calendar year has yet to be announced. The industry invested approximately $6.7 billion in capital during 2011.

Contact:

Sandra Steilo
Media Relations
Ministry of Energy, Mines and Natural Gas
250 952-0617