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LNG Canada says the entry of Malaysia’s Petronas into the energy consortium will be a shot in the arm for the $40-billion proposal to export liquefied natural gas from British Columbia.

“We’ve just added to the dream team. When you consider the wealth of experience that Petronas has in the LNG sector and you consider the large investment in Canadian natural gas that they have in the upstream, they are another dream partner,” Susannah Pierce, director of external relations at LNG Canada, said in an interview on Thursday.

She made the comments after Petronas announced it will buy a 25-per-cent stake in LNG Canada, which is led by Royal Dutch Shell PLC. The Shell-led group wants to build an export terminal in Kitimat, where LNG would be shipped to Asia. TransCanada Corp. has been tapped to construct a pipeline from northeastern B.C. to Kitimat.

Read more: Petronas to buy 25% stake in Shell-led LNG Canada project

Petronas disclosed its move to become the second-largest partner in LNG Canada less than a year after it scrapped its Pacific NorthWest LNG joint venture that had been slated for Lelu Island in the Port of Prince Rupert.

Assuming the transaction closes this summer as planned, Shell will see its stake fall to 40 per cent from 50 per cent; PetroChina drops to 15 per cent from 20 per cent; Japan’s Mitsubishi Corp. stays at 15 per cent; South Korea’s Kogas declines to 5 per cent from 15 per cent; and Petronas picks up 25 per cent.

An industry source told The Globe and Mail that Petronas had considered snapping up Kogas’s minority stake as far back as last summer and Malaysia’s state-owned company later expanded its investment ambitions to also include buying stakes from Shell and PetroChina.

Ms. Pierce said the consortium is taking methodical steps toward construction. In April, for example, LNG Canada selected an engineering joint venture as the prime contractor for the Kitimat plant: Fluor Corp. of Irving, Tex., and JGC Corp., based in Yokohama, Japan. “It’s about driving toward a competitive outcome so that we’re resilient,” she said.

The precise date of a final investment decision (FID) rests with the co-owners, “based on global energy markets, and the overall competitiveness and affordability of the project,” Shell Canada Ltd. spokesman Tara Lemay said from Calgary.

Fears of a global LNG glut have eased, boosting the prospects for LNG Canada, industry analysts say.

“We believe this to be a positive development for Petronas. We expect the global LNG market to tighten post-2022 and this bodes well for the project,” Wood Mackenzie analyst Prasanth Kakaraparthi said in a research note.

He pointed out that the BC NDP minority government’s proposals unveiled in March – including sales-tax relief for construction and the elimination of specific income tax on the industry – should strengthen LNG Canada, but cautionary flags remain.

“Costs will be a major concern for the project,” Mr. Kakaraparthi said. “But before LNG Canada can take FID, it will need to lower costs and take advantage of the latest tax breaks announced by the B.C. government.”

While BC Green Leader Andrew Weaver opposes LNG exports from the West Coast, BC NDP Energy Minister Michelle Mungall welcomed the announcement that Petronas is poised to join LNG Canada. “Petronas’s investment decision signals that our new framework for natural gas development truly makes B.C. a competitive option for investment,” Ms. Mungall said in a statement.

Local leaders in the Kitimat region praised Thursday’s news. “We are happy to see the continued confidence in the LNG Canada project with Petronas’s investment,” Haisla Nation chief councillor Crystal Smith said. The District of Kitimat added that it believes the addition of Petronas “provides more certainty to LNG Canada reaching a positive final investment decision in 2018.”