Exploring New Shores: An Overview of the Legal Landscape Relating to the Supply and Transportation of LNG from Canadian Ports

Abstract

This article provides an overview of the key areas of the legal landscape downstream of liquefaction terminals in the context of Canadian LNG projects. This will be of particular interest to those involved in Canada's nascent LNG industry, including project proponents, buyers and sellers of LNG, and owners and operators of LNG carriers and other vessels intending to load LNG, either as cargo or bunker fuel, from a terminal in Canada.

Canada’s LNG industry has had a rocky start in some respects, with many projects having been shelved and a number of the remaining projects facing an uncertain future due to market conditions, regulatory obstacles, and other challenges. However, there continue to be many factors supporting the development of LNG liquefaction capacity in Canada, including the desire to supply the world with responsibly sourced, cost-effective, and relatively clean fuel, and it is expected that a number of projects will ultimately proceed.

The supply and transportation of LNG from such projects once they become operational will engage the body of maritime laws governing the operation of ships in Canadian waters and, where relevant, Canada’s export laws. Other requirements may additionally apply by virtue of the contractual arrangements typically entered into in connection with such activities. Such regulatory and other requirements, and their place within the broader LNG value chain, are the subject of this article.