reu-2019-02-01 Qatar Texas LNG
https://www.reuters.com/article/us-global-lng-golden-pass-exclusive/exclusive-qatar-exxon-to-proceed-with-10-billion-texas-lng-project-sources-idUSKCN1PQ4OZ
Exclusive: Qatar, Exxon to proceed with $10 billion Texas LNG project - sources
Ron Bousso, Jessica Resnick-Ault
LONDON/NEW YORK (Reuters) - Qatar Petroleum and Exxon Mobil Corp are
expected to announce plans next week to proceed with a $10 billion
project that will expand a liquefied natural gas (LNG) export facility in
Texas, three people familiar with the transaction said.
FILE PHOTO: A logo of the Exxon Mobil Corp is seen at the Rio Oil and Gas
Expo and Conference in Rio de Janeiro, Brazil September 24, 2018.
REUTERS/Sergio Moraes/File Photo
ConocoPhillips, the third partner in the existing terminal, plans to sell
its 12.4 percent stake in the project and does not plan to participate in
the expansion, the people said.
LNG demand is soaring. Worldwide consumption of the fuel is expected to
more than double to 550 million tonnes a year (mtpa) by 2030, triggering
a race among oil and gas companies eager to dominate the market.
The Golden Pass LNG Terminal is a receiving and regasification facility
in Sabine Pass, Texas that can handle up to 2 billion cubic feet of
natural gas imports per day to the United States.
However, as U.S. gas production has soared to new records, bolstered by
shale production, the demand for export capacity has increased. The
potential $10 billion expansion, first announced in 2014, would focus on
this new market dynamic.
It is part of Qatar Petroleum's plans to invest some $20 billion in the
United States as the company seeks to increase its overseas oil and gas
footprint.
The most likely buyer for ConocoPhillips' stake is Exxon Mobil, two of
the people said, adding that the existing partners do not want to bring
in another participant, as plans for the project are in advanced stages.
Currently, Exxon has a 17.4 percent stake in the project, and Qatar
Petroleum holds the 70 percent majority stake.
Exxon and Qatar are strengthening a global alliance across LNG projects
from the United States to Mozambique. Exxon is trying to get a seat at
Qatar's table, and to do so may be willing to make certain concessions,
one of the people said.
Qatar was the world's largest LNG producer in 2017 and has annual output
of 77 million tonnes.
Exxon and ConocoPhillips declined to comment, while Qatar Petroleum could
not immediately be reached for comment.
ConocoPhillips' stake sale led to delays in announcing the final decision
to proceed with the project, one of the people said. The people spoke on
condition of anonymity because the conversations were private. The move
comes as ConocoPhillips hones its focus on international projects.
The Golden Pass project is one of many that could be approved this year.
Firms are expected to make final decisions on projects that could add
more than 60 million tonnes per annum of LNG capacity this year. That's
well above the previous record of about 45 million tonnes in 2005 and
triple last year's 21 million tonnes, Wood Mackenzie's research director
for global gas and LNG, Giles Farrer, said last month.
More than 320 million tonnes of LNG was shipped globally in 2018,
according to Refinitiv Eikon shipping data.
Qatar left the Organization of the Petroleum Exporting Countries last
year, allowing it to expand in the United States without concerns about
proposed legislation that could limit OPEC members' investments in the
country.
Reporting by Jessica Resnick-Ault and Ron Bousso; Additional reporting by Rania El-Gamal, David French and Dmitry Zhdannikov; Editing by Dale Hudson