The parent company of Woodfibre LNG is buying a private Calgary oil and gas producer.
In a joint announcement this week, Pacific Oil & Gas Ltd. says it has struck a cash deal to buy Canbriam Energy Inc., which produces natural gas from the prolific Montney geological formation in northeastern B.C.
The companies say the transaction will result in a "well-capitalized" entity able to grow current Canbriam production of about 200 million cubic feet per day of natural gas, including 6,000 barrels per day of associated natural gas liquids.
Rebecca Scott, Woodfibre LNG spokesperson, said the deal is "a strong signal of [Pacific Oil & Gas's] confidence in B.C., and their intention to stay in Canada for the long term."
Pacific Oil & Gas is an arm of the Singapore-based Royal Golden Eagle group of companies, focused on energy development for the Asian market, and owns several companies in addition to Squamish's Woodfibre.
The deal includes Canbriam's owned and operated gas processing plants and water handling infrastructure.
Scott said Woodfibre LNG's plans to move forward are not dependent on this deal.
"It is a strong signal of confidence in B.C.’s natural gas sector, including LNG, and marks the largest investment in Canada’s natural gas sector since the oil market downturn began in 2014," she said.
Woodfibre LNG project is licensed to export 2.1 million tonnes of liquefied natural gas per year for 40 years but has not been officially sanctioned for construction.
~With files from Jennifer Thuncher/The Squamish Chief