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Kitimat LNG, Haisla First Nation finalize partnership agreement

Deal clears major hurdle for project to become West Coast’s first LNG import facility to market

Vancouver, April 26, 2006 – Kitimat LNG and the Haisla First Nation today announced they have finalized a partnership agreement for the company’s proposed $500M LNG import and regasification terminal.

The agreement with the Haisla clears a major hurdle for KLNG to build the first import terminal on the Canadian West Coast, says company president Rosemary Boulton.

“Pending final regulatory approval, we will be the first project to market,” says Boulton. “We have moved significantly closer to providing Pacific Basin gas suppliers with new access to the high-priced western Canadian and American marketplace. Our facility is strongly positioned to become a real solution to the North American supply-demand imbalance.”

KLNG, a Canadian energy infrastructure company, is proposing to build, own and operate an LNG receiving terminal north of Vancouver, British Columbia. The facility’s location provides LNG suppliers both a convenient shipping route and ready pipeline access to North American markets.

The $500M terminal will include marine off-loading, LNG storage, natural gas liquids recovery, regasification and send-out facilities. The terminal will deliver gas into the existing Pacific Northern Gas Ltd. pipeline for shipment to Canadian and U.S. West Coast gas markets.

The progressive deal recognizes KLNG and the Haisla’s mutual interests, says Boulton.

The agreement provides the Haisla the opportunity to purchase equity in KLNG; minimum standards of employment during construction and operations; employment training; and procurement opportunities. As part of the land-lease agreement between the federal government and Kitimat LNG, the Haisla will receive annual tax revenue and lease payments through Indian and Northern Affairs Canada, a federal government ministry. The land is already designated for industrial use.

Kitimat LNG is now awaiting final approval of its environmental assessment certificate application. The B.C. Environmental Assessment Office recently submitted its report and recommendation to the Province for review. A decision from government environmental agencies is expected in early June. Pending approval, construction is slated to begin mid-2006, with full operation set for early 2009.

An Agreement in Principle between Kitimat LNG and the Haisla was reached December.

Contact: Patti Schom-Moffatt, Director of Communications
250-279-0224 in Kitimat or 604-999-9058 in Vancouver.

About Kitimat LNG Terminal – Kitimat LNG Terminal is a wholly owned subsidiary of Galveston LNG, a Calgary-based private company focused on the development of liquefied natural gas (LNG) and related facilities in North America. Kitimat LNG Terminal is proposing to construct, own and operate a liquefied natural gas receiving terminal near the Port of Kitimat in British Columbia. The terminal will be an environmentally sensitive facility that will receive and store LNG before it is regasified into a vapour and shipped, via existing pipelines, into the growing North American gas markets in B.C., Alberta and the Pacific Northwest.

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