Europe seeks to diversify energy sources with Canadian LNG via Panama

Canada's Energy and Natural Resources Minister said in August German companies are looking to buy and swap Canadian LNG cargoes. But now, they are also interested in taking shipments of the physical Canadian product, the sources said.

The Iran war and the resulting Strait of Hormuz closure have made it increasingly likely that Ksi Lisims gets built, said Jamie Heard, vice president, capital markets for Tourmaline Oil, one of the Rockies LNG partners behind the project. He said Western Canadian natural gas prices continue to lag behind the US benchmark, making a strong business case for Canadian LNG.

"The economic rationale is there, these projects can pay themselves off quite quickly with spreads at that level," Heard said in an interview.

(Reporting by Amanda Stephenson in Calgary; additional reporting by Christoph Steitz and Marwa Rashad; Editing by Caroline Stauffer and Nick Zieminski)