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Shell Approves Long-Awaited Canadian LNG Project

Decision to go ahead with $14 billion project follows years of delay, and signals growing confidence in global gas markets

LONDON—A group led by Royal Dutch Shell RDS.A -0.33% PLC is pressing ahead with a major Canadian liquefied natural gas project after years of delay, the company said Tuesday, raising competition for LNG developments in the U.S. already under pressure from new Chinese tariffs.

The 14-million-ton-a-year project in British Columbia is the biggest LNG development to gain investment approval in years and the first for Canada. By the mid-2020s, it is expected to start sending massive tankers of supercooled natural gas to demand centers in Asia.

Shell and its partners’ commitment to the project, which will cost roughly $14 billion to construct, signals growing confidence in global gas markets, as rising demand diminishes the threat that new supplies will cause a glut. The project was announced in 2012, but weak prices had pushed back a final investment decision expected in 2016.

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