By ANGEL GONZALEZ
HOUSTON -- A Royal Dutch Shell unit struck a deal with a
Kinder Morgan company to export liquefied natural gas out of an
existing import terminal near Savannah, Ga., the companies said
The move, which comes in the wake of a recent report
commissioned by the US 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.
ExxonMobil last year announced it wanted to turn an existing
import terminal in Texas into a facility than can also export,
and Chevron last month partnered with Apache 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 US permission to export to countries with
which the US 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's Louisiana
terminal, is authorized for exports and is under construction.
The companies said that they would seek to modify El Paso
Pipeline Partners'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/day of
"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 US and other countries," said Kinder Morgan
CEO Richard Kinder in a statement.
Dow Jones Newswires