Peter Zebedee at the LNG Canada offices in downtown Vancouver on Oct. 31, 2019.Rafal Gerszak/The Globe and Mail
Peter Zebedee is stepping down as LNG Canada chief executive officer, leaving the B.C. megaproject as it enters its peak construction phase and opting to join Suncor Energy Inc. SU-T as a vice-president in Alberta.
His surprising exit takes effect on March 29, nearly 33 months after he took over the top job at LNG Canada, which is building an $18-billion terminal to export liquefied natural gas from Kitimat, B.C.
Mr. Zebedee is departing at a crucial time for LNG Canada, long before the terminal’s construction is completed within three years and while the co-owners continue mulling whether to approve a major expansion.
After Russia’s invasion of Ukraine last month, Europe has been scrambling to reduce its dependence on natural gas from Russia. LNG Canada’s exports of natural gas in liquid form to Asia, starting in 2025, would indirectly help Europe because that frees up supplies of the fuel elsewhere in the world to be rerouted to Europe.
Shell PLC is the largest partner in LNG Canada, with a 40-per-cent stake. The other partners are Malaysia’s state-owned Petronas (25 per cent), PetroChina (15 per cent), Japan’s Mitsubishi Corp. (15 per cent) and South Korea’s Kogas (5 per cent).
Prior to LNG Canada, Mr. Zebedee served as general manager of Shell’s Scotford oil refinery near Edmonton.
“The progress that the LNG Canada project has made in the past three years has been truly remarkable, especially in the context of a global pandemic,” he said in a statement on Tuesday. Mr. Zebedee wasn’t available for comment on Tuesday through either Suncor or LNG Canada.
Steve Corbin, executive project director at LNG Canada, has been named as interim CEO of the Kitimat project.
Mr. Zebedee’s role at Calgary-based Suncor will be executive vice-president of mining and upgrading, taking effect in April. He will be replacing the retiring Mike MacSween’s position in Alberta.
“Peter brings over 25 years of deep experience in oil sands mining and upgrading from his time at Shell, Petro-Canada and Syncrude,” Suncor said in a news release.
Construction at LNG Canada’s Kitimat terminal began in October, 2018, and is nearly 60 per cent complete. The joint venture has entered its busiest construction schedule from this spring through 2024, requiring up to 7,500 workers on rotation.
LNG Canada estimates project-related costs will total $40-billion for the first phase, counting the Kitimat terminal and various infrastructure that includes the Coastal GasLink pipeline to be operated by TC Energy Corp.
Coastal GasLink would transport natural gas from northeast British Columbia to the Kitimat terminal, where liquefied natural gas is slated to be exported to Asian markets beginning in 2025. The total budget also includes billions of dollars a year to be spent by producers drilling for natural gas in northeast B.C.
While Coastal GasLink has been approved by 20 elected First Nation councils along the 670-kilometre route, the pipeline project has been the target of protests led by a group of Wet’suwet’en Nation hereditary chiefs who say a 190-kilometre portion of the route goes through unceded territory under their jurisdiction.
LNG Canada’s co-owners have yet to decide on whether to approve Phase 2, which would be an expansion of the terminal now being built.
With the Kitimat site much closer to Asian markets than existing liquefied natural gas terminals in the United States, that is a competitive advantage, Canadian analysts say.
Dan Tsubouchi, chief market strategist at SAF Group, said in a recent research note that Shell has a bullish outlook on liquefied natural gas globally and that could bode well for LNG Canada’s potential Phase 2.
“The most important take-away is that Shell is now planning their strategies and capital allocation on a forecast of an LNG supply-demand gap to emerge in the mid-2020s,” Mr. Tsubouchi said. “The issues on LNG supply mean that there is a LNG supply gap and investment in new supply is needed.”
After Russia invaded Ukraine last month, European natural gas prices have been volatile, hitting record highs before falling as fears eased about the severity of shortages of the fuel.
Russia supplied nearly 40 per cent of the Europe Union’s total consumption of natural gas last year, accounting for 45 per cent of the EU’s overall imports of the fuel, according to the International Energy Agency.
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