AltaGas and Vopak have reached a positive final investment decision (FID) on the Ridley Island Energy Export Facility (REEF), a large-scale liquefied petroleum gas (LPG) and bulk liquids terminal with rail, logistics and marine infrastructure on Ridley Island, British Columbia, Canada.
Following a five-year environmental preparation and review process, extensive engagement with multiple stakeholders including Indigenous rights holders and local communities, the Vopak-AltaGas joint venture is set to deliver a world class export facility that will operate with industry-leading environmental stewardship. For example, onsite work will be minimised to reduce capital cost risk and community impacts, with 90% of equipment, packaging and pipes expected to be prefabricated offsite in controlled operating environments.
The project has First Nations support agreements in place and will drive further economic benefits to local communities in Northwestern B.C. through construction activities, long-term job creation and community investment focused on delivering positive outcomes for all stakeholders.
The joint venture has completed all major gating items, including front-end engineering design (FEED) and a detailed Class III capital estimate. Site clearing work is already more than 95% complete and with required permits in hand, the project is expected to come online near 2026 year-end.
The projected gross joint venture capital cost of CAD$1.35 billion (€0.9 billion), excluding governmental incentives and support, with annual Partnership EBITDA of $185 million – $215 million are in-line with the Partners’ expectations. The joint venture expects to lock-in more than 60% of the Phase 1 capital costs through fixed-price, lump-sum engineering, procurement and fabrication contracts prior to construction.
With only 10 shipping days to the fastest growing demand markets in Northeast Asia, REEF has a structural advantage in delivering LPGs to Asia with the shortest shipping time globally.REEF will enhance Canada’s role as a growing global energy exporter, strengthen Canadian and Asia Pacific energy connectivity and provide Canadian producers and aggregators with access to the premium global markets for LPGs.
‘This positive FID enables AltaGas to continue connecting Canadian energy to Asian markets and drive valuable outcomes for all our customers,’ says Vern Yu, president and CEO of AltaGas. ‘Canada has a structural advantage in delivering LPGs to Asia with the shortest shipping time and lowest maritime emissions footprint. AltaGas delivers more than 19% of Japan’s propane and 13% of South Korea’s LPG imports, connecting our upstream customers with customers in Asia. We look forward to working with our partners to drive more long-term value creation with REEF.’
‘We are excited to be able to execute on our growth strategy and invest in export infrastructure on this highly strategic location,’ says Dick Richelle, chairman of the Executive Board and CEO of Royal Vopak. ‘Prince Rupert, with the shortest shipping distances between North America and Asia, gives the opportunity to drive progress by increasing the trade between Canada and the Asia Pacific region. We are proud to contribute to this development and are thankful for the good collaboration with our partner AltaGas and other key stakeholders. The trust and support of local First Nations and communities makes this envisioned terminal a reality.’
