Squamish's Woodfibre LNG price tag balloons to US$8.8 billion

The Woodfibre LNG facility project near Squamish is facing significant cost overruns, with the price tag ballooning to US$8.8 billion from an initial estimate of $5.1 billion. The company cited rising costs for site remediation, construction inflation, the expense of marine transportation, and other factors as key drivers of the increased costs.

Despite the 73 per cent increase in project costs, Woodfibre LNG assured that the revised budget does not impact their financing. The project, which is halfway through construction and on track to start production in 2027, has made necessary financial adjustments to ensure successful delivery.

Economist Werner Antweiler expressed concerns about the increased risk associated with the higher cost of the project, especially considering its relatively small capacity compared to other LNG plants. The project, designed to produce 2.1 million tonnes of liquefied gas per year, has seen Enbridge Inc., a 30 per cent owner, report a cost increase from $1.5 billion to $2.9 billion.

Woodfibre LNG, known for its focus on low-carbon LNG production, has already secured sales agreements for 90 per cent of its output to BP Gas Marketing Ltd. The project’s production is fully subscribed under sales contracts for the first 15 years of operation.

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