Join our crew and become one of the 104,506 members that receive our newsletter.

port of savannah georgia

Shell and Kinder Morgan Strike Deal to Export LNG from US

Dow Jones
Total Views: 9
January 28, 2013

By Angel Gonzalez

HOUSTON–A Royal Dutch Shell PLC (RDSA) unit struck a deal with a Kinder Morgan Inc (KMI) company to export liquefied natural gas out of an existing import terminal near Savannah, Ga., the companies said Monday.

savannah georgia
Savannah, Georgia

The move, which comes in the wake of a recent report commissioned by the U.S. Department of Energy that came out in favor of LNG exports, is the latest among major energy companies seeking to capitalize on North America’s the newly found abundance of natural gas from shale. Exxon Mobil Corp. (XOM) last year announced it wanted to turn an existing import terminal in Texas into a facility than can also export, and Chevron Corp. (CVX) last month partnered with Apache Corp. (APA) to liquefy and export natural gas out of western Canada. Shell is also working on a competing Western Canada LNG export project.

To be sure, the Georgia export project faces hurdles: it still must receive U.S. permission to export to countries with which the U.S. doesn’t have free trade agreements, and the companies must finalize investment decisions. But it is likely to strengthen the project’s chances of standing out amid 20 or so different projects awaiting for permits to sell LNG to non-FTA countries, due to Shell’s big pockets and its experience in the LNG business. So far only one project, Cheniere Energy Inc. (LNG)’s Louisiana terminal, is authorized for exports and is under construction.

The companies said that they would seek to modify El Paso Pipeline Partners LP (EPB)’s Elba Express Pipeline Unit and the Elba Island LNG Terminal to move natural gas to the terminal, liquefy it and ship it. El Paso, a Kinder Morgan unit, will own 51% of the partnership and run the facility, and Shell will own 49% and have rights to 100% of the liquefaction capacity of the terminal. The project is expected to be able to ship 350 million cubic feet of gas per day.

“This project will facilitate further development of the abundant natural gas resources in the United States and will be a positive factor in the overall balance of trade between the U.S. and other countries,” said Kinder Morgan Chief Executive Richard Kinder in a statement.

Write to Angel Gonzalez at [email protected]

(c) 2013 Dow Jones & Company

Unlock Exclusive Insights Today!

Join the gCaptain Club for curated content, insider opinions, and vibrant community discussions.

Sign Up
Back to Main
polygon icon polygon icon

Why Join the gCaptain Club?

Access exclusive insights, engage in vibrant discussions, and gain perspectives from our CEO.

Sign Up
close

JOIN OUR CREW

Maritime and offshore news trusted by our 104,506 members delivered daily straight to your inbox.

Join Our Crew

Join the 104,506 members that receive our newsletter.