Shrinking Canadian expectations

The future of unconventional gas drilling in the western basins is uncertain because of the cancellation of several high-profile LNG projects

In Canada—and especially British Columbia (BC)—gas drilling is (or was) dependent on approvals for multi-billion-dollar liquefaction terminals on the country's west coast. Proponents had to demonstrate at least 20 years of proven reserves to secure export licenses. This, in turn, sparked a prolonged boom in unconventional shale plays such as the Montney. So, despite persistently low North American gas prices, Canadian drilling and production held up reasonably well—as long as there were proposed outlets for the fuel. That changed in July 2017 after Petronas abruptly cancelled a proposed C$36bn ($28.9bn) terminal in Kitimat, on BC's northern shore. A sizeable portion of that outlay, some C$6b