Tuesday, November 23, 2010

More LNG Export in the 'Hood

Australian investment bank Maquarie, famous in financial circles for its investment in infrastructure projects like U.S. toll roads, has partnered with Freeport LNG to provide financing to retrofit Freeport's Texas LNG import facility to become an export facility.  Freeport's plans are similar to those of Cheniere Energy's Sabine Pass facility, and the project is expected to cost around $2 billion. (A good longer article from the Houston Chronicle.)

While financing is an important hurdle, the facility must also get a number of regulatory approvals before construction will begin.  Building an LNG export facility is a long-term project and will not help solve the current imbalance in U.S. natural gas supply and demand that has crushed prices, but it does bode well for the future of natural gas in this country.

If you are looking for another reason to like natural gas, here's a nice tid-bit from the article on the Financial Times web site noted above:

"The shale boom has made the country the world’s biggest natural gas producer, with 57bn cu ft a day of output, according to Nikos Tsafos of PFC Energy, the consultancy. If the US exported just a 10th of its gas last year, he says, it would have been the world’s top LNG exporter."
Hmmmm, the U.S. has an enormous trade deficit.  Hmmmm, we can export natural gas to other nations, including China.  Hmmmm, hmmmm, hmmmmmmmmmm.  Did someone say "win-win?" (Although the quote above doesn't consider Qatar's massive LNG export infrastructure that mostly came on line in 2010.)  

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