Efforts to ramp up Canada’s capability for exporting liquefied natural gas are gaining steam.
Cedar LNG recently announced a positive final investment decision on its floating LNG facility with a 3.3 mtpa capacity. This facility will be located on the west coast of Canada will likely come online in late 2028.
A partnership between Pembina Pipeline Corporation and the Haisla Nation, Cedar LNG’s project can help position Canada as a more notable exporter of LNG. One of Canada’s key advantages in exporting LNG is its proximity to growing liquified natural gas demand in Asia.
See More: Canadian LNG Projects Advance to Meet Asian Demand
Midstream Provides Direct and Indirect LNG Export Exposure
Midstream investors can harness a fund like the Alerian Energy Infrastructure ETF (ENFR ) for exposure to Canada’s upcoming LNG expansion. Multiple ENFR holdings have a role to play in Canadian liquified natural gas exports.
To start, Pembina Pipeline Corporation is currently among the top 15 holdings within ENFR. With Pembina being one of the architects behind the upcoming LNG facility, investors can use ENFR to gain exposure to potential returns.
ENFR’s exposure to the Cedar LNG Project doesn’t stop at Pembina. Another key holding for ENFR is TC Energy. Currently, TC Energy intends to deliver natural gas to the facility through its recently constructed Coastal GasLink pipeline.
Enbridge Inc., the third-largest holding in ENFR, owns a 30% stake in Woodfibre LNG, which is also being constructed on Canada’s west coast. It is expected to be in service in 2027.
ENFR tracks the Alerian Midstream Energy Select Index. AMEI is a float-adjusted, cap-weighted, and capped index of companies engaged in midstream activities.
As of May 31, 2024, ENFR’s NAV is up 34.15% over the last 12 months. The fund currently has over $150 million in assets under management.
vettafi.com owned by VettaFi LLC (“VettaFi”). VettaFi is the index provider for ENFR, for which it receives an index licensing fee. However, ENFR is not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of ENFR.
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