Mitsubishi, Shell get Canada approval to export shale gas

Japanese trading house Mitsubishi Corp., Royal Dutch Shell plc and two other companies jointly have won approval from the Canadian government to export shale gas from western Canada to destinations such as Japan and other Asian countries, Kyodo News Agency reported Monday, citing sources. The approval to export shale gas in the form of liquefied natural gas (LNG) for an annual total of 24 million tons over 25 years, was given last month to Mitsubishi, Anglo-Dutch oil giant Shell, Korea Gas Corp. and China National Petroleum Corp., the sources said, according to Kyodo.  The four firms are expected to begin production at a level of around 12 million tons per year starting around 2020, the report said. Japanese firms' involvement in the acquisition of shale gas -- which is cheaper than conventional natural gas -- has been growing, as seen also by the announcement Monday by Japan Petroleum Exploration Co. that it will take part in a separate shale gas development project in western Canada.  As for the gas production project involving Mitsubishi, Shell has a 40 percent concession, while the three others have 20 percent each. The four companies plan to build an export facility near the port of Kitimat, British Columbia.  Demand for LNG has surged in Japan for thermal power generation due to the halt of nuclear power plants following the March 2011 disaster at the Fukushima Daiichi nuclear complex. Demand is also expected to expand in growing Asian economies.