Kitimat LNG and EOG sign natural gas supply agreement

Artist rendering of Kitimat LNG Inc.'s processing plant

Kitimat LNG announced it has signed a memorandum of understanding (“MOU”) with Texas-based EOG Resources Inc. (NYSE:EOG), whereby EOG will supply natural gas from the Horn River basin to Kitimat LNG’s planned liquid natural gas facility in Kitimat, British Columbia.

Rosemary Boulton, President of Kitimat LNG stated:

“EOG’s participation in our project reinforces the fact that business and natural gas fundamentals support our LNG terminal. Kitimat LNG presents a compelling opportunity for producers to leverage growing natural gas reserves in western Canada and sell into significant new international markets such as Asia.”

This announcement follows two previous announced MOUs Korea Gas Corp. (HRN: Kitmat LNG signs MOU with Korea Gas Corp worth $20 billion) and Spain’s Gas Natural (HRN: Kitimat LNG signs MOU with Spain’s Gas Natural) to purchase LNG from Kitima LNG’s facility over the next ten years.

The Kitmat LNG facility is the critical link to opening new  international markets for the Horn River basin and the western Canadian gas industry as a whole. EOG is an early major into the Horn River basin which  has an estimated 250 trillion cubic feet of natural gas locked in the shale rock formation.

The Canadian Press: EOG, Kitimat LNG reach agreement on proposed liquefied natural gas project