Natural Gas Production & Export

• Pipeline natural gas
• Natural gas liquids (NGLs)
• Propane
• Butane
• LNG (under development)

1. 1

   Accelerate LNG export terminal development for Pacific market access

2. 2

   Develop petrochemical feedstock demand to consume domestic gas production

3. 3

   Invest in low-carbon gas production and methane emissions reduction

4. 4

   Pursue gas-to-hydrogen pathways aligned with emerging hydrogen economy demand

5. 5

   Expand NGL fractionation and export capacity through pipeline optimization

Natural gas trade flows freely under CUSMA, but infrastructure constraints effectively lock Canadian gas into continental markets. The US shale gas revolution has transformed the bilateral dynamic from Canadian supply dominance to direct competition. CUSMA provides no protection against US regulatory actions that could restrict pipeline imports or favour domestic production.

Pipeline infrastructure connects western Canadian gas exclusively to US markets, creating price-taker dynamics relative to US Henry Hub pricing. AECO hub pricing discounts reflect transportation constraints and surplus basin supply. LNG Canada and proposed Pacific coast LNG projects represent the only structural solution to US market over-dependence.

Canadian natural gas competes with prolific US shale basins (Permian, Appalachian) that have driven continental prices to historic lows. The Montney and Duvernay formations contain globally competitive resource quality, but market access limits production growth. Asian LNG markets offer premium pricing that could unlock significant investment if export infrastructure is completed.