LNG Canada has reached a final investment decision on its $33-billion Phase 2 expansion in Kitimat, BC, clearing the way for what the federal government says will be the second-largest single private investment in Canadian history.
Prime Minister Mark Carney welcomed the decision, saying the expansion will make LNG Canada the world's second-largest facility of its kind. The project will double the terminal’s capacity to 28 million tonnes annually and is expected to create more than 4,000 direct construction jobs.
The decision follows the federal government’s referral of LNG Canada Phase 2 to the Major Projects Office in September 2025. According to the government, the office has since supported the project as it moved toward an investment decision and construction, including through partnerships with British Columbia and industry participants.
The facility is located in Kitimat on the traditional territory of the Haisla Nation. LNG Canada has awarded nearly $5 billion in contracts and procurement to First Nations and local businesses in the region.
Phase 2 also includes an Indigenous equity opportunity through an agreement with MNT Investments LP, representing the Gitga’at, GitxaaĊa, Haisla, Kitselas and Kitsumkalum Nations.
Under the agreement, the five First Nations have an option to invest up to $1 billion to acquire a majority ownership interest in the project’s new 225,000-cubic-metre Phase 2 LNG storage tank. The arrangement uses a sale-leaseback structure intended to provide participating communities with long-term revenue.
The federal government said greenhouse gas emissions from LNG Canada’s Kitimat operation are expected to be lower than those of any operating facility of a similar size. Phase 1 began exporting LNG in June 2025, marking the first direct Canadian LNG exports to customers.
LNG Canada is a joint venture comprising Shell Canada with a 40-percent interest, PETRONAS with 25 percent, PetroChina and Mitsubishi Corporation with 15 percent each, and KOGAS with five percent.
The LNG Canada decision also led TC Energy to make a final investment decision on Coastal GasLink Phase 2. That project will double the pipeline’s existing capacity by adding compressor stations and upgrading facilities along the existing 670-kilometre route between Dawson Creek and the LNG Canada facility.
Construction on Coastal GasLink Phase 2 is scheduled to begin next year and is expected to create more than 2,000 jobs. Coastal GasLink has awarded more than $1.8 billion in contracts to Indigenous and local businesses over the project’s lifetime.
The federal government said the two investment decisions will increase Canada’s LNG export capacity and strengthen the country’s energy supply to global markets.