With a major announcement by oil giant Shell on Tuesday, Canada has set itself up to become the U.S.'s biggest energy rival in supplying liquefied natural gas to Asia.

Shell officials said LNG Canada, a massive multibillion dollar LNG export project in British Columbia, will compete directly with U.S. LNG terminals on the Gulf Coast by being able to beat U.S. companies on the price of shipping the fuel to customers in China, Japan, Malaysia, and South Korea.

The announcement came less than 36 hours after the Trump administration announced it had reached a deal with Canada on NAFTA.

"When compared against a typical greenfield development on the Gulf Coast, we expect LNG Canada to benefit, on average, from lower shipping costs of some $1 [per unit of natural gas]," said Jessica Uhl, Shell's chief financial officer, on a Tuesday call will investors. "In combination, we see a $1.5 [per unit of natural gas] advantage that adds to the competitiveness of this project."

Shell will control a 40 percent stake in the project. Its partners, including Malaysia's Petronas, Chinese government-run PetroChina, Japanese conglomerate Mitsubishi, and South Korea's KOGAS, will be major buyers of the LNG. The companies joined Shell in making the announcement on Tuesday to build the export facility in Kitimat, British Columbia.

Shell said the decision to move forward was made based on LNG demand doubling over the next 17 years. But is also has to do with the company’s outlook for transitioning to sources of energy that emit lower amounts of carbon dioxide.

“Supplying natural gas over the coming decades will be critical as the world transitions to a lower carbon energy system,” said Ben van Beurden, CEO of Royal Dutch Shell.

“Global LNG demand is expected to double by 2035 compared with today, with much of this growth coming from Asia where gas displaces coal,” he added. “LNG Canada is well positioned to help Shell meet the growing needs of customers at a time when we see an LNG supply shortage in our outlook.”

Analysts are calling LNG Canada the largest new export project in the world and a return to the "megaprojects" last announced in Russia and Kazakhstan in recent years.

“This would make LNG Canada the biggest project sanction globally since the Tengiz expansion was approved in 2016 and the biggest greenfield project to be sanctioned since Yamal LNG in 2013,” said Dulles Wang, North America gas director at the consulting firm WoodMac. “It seems that megaprojects are back.”

In contrast to the projects in the U.S., LNG Canada would be completely new. The export terminals at Sabine Pass on the Gulf Coast and at Cove Point in Maryland were based on pre-existing import terminals that were reworked to export natural gas. Wang says the Shell plant will be built from the ground up.

TransCanada, which proposed the Keystone XL pipeline to link Canada's oil to the U.S., will build, own, and operate the Coastal GasLink pipeline that will ship natural gas to LNG Canada for export. The export terminal will be built by a joint venture between Texas-based engineering giant Fluor and the Japanese-based JGC.

Shell says the plant won't be come online until the mid-2020s when it sees a natural gas "supply shortage" developing, said Beurden in a video message.

Although Shell did not provide a cost estimate for the project, initial estimates were reported as between $18 billion and $40 billion.

The timing of the announcement follows the U.S. reaching a trade deal with Canada, which could have played into the decision. With lowered tensions between Canada and the U.S., the announcement makes sense in the hours after the new NAFTA deal.

Beurden said the project has unprecedented support from First Nations and local and provincial governments. It has also met all environmental requirements to move ahead, he said.

The project also comes on the second day of climate talks in Incheon, South Korea, on meeting a much stricter climate temperature target under the Paris Agreement. Canadian Prime Minister Justin Trudeau is a proponent of the climate deal and reaching the United Nations’ sustainable development goals.

LNG Canada "also supports Shell towards another of its strategic ambitions to thrive through the global energy transition to a lower carbon energy system," Beurden said on Tuesday. The facility is has a low-carbon footprint, with the aim of assisting Asia in transitioning "away from coal, which is one of the most carbon-intensive of energy sources."