Project bolstered by Shell’s global LNG prominence, Energy Transfer’s
extensive pipeline network
DALLAS & HOUSTON--(BUSINESS WIRE)--Mar. 25, 2019--
Energy Transfer LP (NYSE: ET) and Shell US LNG, LLC (Shell) today signed
a Project Framework Agreement (PFA) that provides the framework to
further develop a large-scale LNG export facility in Lake Charles,
Louisiana toward a potential final investment decision (FID). In
addition, the parties have started actively engaging with LNG
Engineering, Procurement and Contracting (EPC) companies with a plan to
issue an Invitation to Tender (ITT) in the weeks ahead.
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The Lake Charles LNG project brings together two leading entities –
Shell as a worldwide leader in gas and LNG, and Energy Transfer as one
of the largest pipeline operators in the U.S. – to advance a project to
monetize abundant, low-cost U.S. gas for export to global customers.
“We are pleased to be moving forward with Shell in progressing this
major LNG export project,” said Tom Mason, President, Lake Charles LNG,
an Energy Transfer subsidiary. “We believe the combination of our assets
and Shell’s LNG experience will create a platform for exporting natural
gas from the U.S. Gulf Coast to the global marketplace that is
unmatched.”
“Lake Charles presents a material, competitive liquefaction project with
the potential to provide Shell with an operated LNG export position on
the U.S. Gulf Coast by the time global supply is expected to tighten in
the mid-2020’s,” said Frederic Phipps, Shell’s Vice President, Lake
Charles LNG. “Our partnership with Energy Transfer plays to our
respective strengths. Together, we are expertly positioned to advance a
project that could provide customers in Asia, Europe and the Americas
with cleaner, reliable energy for decades to come.”
The PFA defines the commercial terms by which the two companies will
work toward delivering an LNG export facility on the U.S. Gulf Coast.
Shell will act as the Project Lead prior to the companies reaching an
FID, and if sanctioned, as construction manager and operator of the
facility. Energy Transfer will act as Site Manager and Project
Coordinator prior to FID. The decision to make an affirmative FID to
proceed with construction of the project will be subject to both
companies’ assessment of the outcome of the EPC bidding process, overall
project competitiveness and global LNG market conditions at the time of
such decision.
The Lake Charles project is a 50/50 venture between Energy Transfer and
Shell. The project, if sanctioned through an affirmative FID, would
convert Energy Transfer’s existing Lake Charles LNG import and
regasification terminal to an LNG export facility with a liquefaction
capacity of 16.45 million tonnes per annum to export U.S. natural gas to
global customers. The project is fully permitted, uses existing
infrastructure and benefits from abundant natural gas supply and
proximity to major pipeline infrastructure, including Energy Transfer’s
vast pipeline network. If built, the project is estimated to create up
to 5,000 local jobs during construction and 200 full-time positions when
fully operational.
Energy Transfer LP (NYSE: ET) owns and operates one of the
largest and most diversified portfolios of energy assets in the United
States, with a strategic footprint in all of the major U.S. production
basins, ET is a publicly traded limited partnership with core operations
that include complementary natural gas midstream, intrastate and
interstate transportation and storage assets; crude oil, natural gas
liquids (NGL) and refined product transportation and terminalling
assets; NGL fractionation; and various acquisition and marketing assets.
ET, through its ownership of Energy Transfer Operating, L.P., formerly
known as Energy Transfer Partners, L.P., also owns the general partner
interests, the incentive distribution rights and 28.5 million common
units of Sunoco LP (NYSE: SUN), and the general partner interests and
39.7 million common units of USA Compression Partners, LP (NYSE: USAC).
Shell
Shell has been a pioneer in LNG for more than 50 years and is involved
in every stage of the LNG value chain: from finding the fields,
extracting the gas and liquefying it; to shipping LNG and turning it
back into gas; to distributing it to customers. Shell has LNG supply
projects around the world, as well as interests in and long-term
capacity access to regasification plants. Shell US LNG, LLC is a wholly
owned subsidiary of Royal Dutch Shell plc.
Energy Transfer Cautionary Statement
This press release may include certain statements concerning
expectations for the future that are forward-looking statements as
defined by federal law. Such forward-looking statements are subject to a
variety of known and unknown risks, uncertainties, and other factors
that are difficult to predict and many of which are beyond management’s
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discussed in the Energy Transfer LP Annual Report on Form 10-K and other
documents filed from time to time with the Securities and Exchange
Commission. Energy Transfer undertakes no obligation to update or revise
any forward-looking statement to reflect new information or events.
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over which Shell has significant influence but neither control nor joint
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used for convenience to indicate the direct and/or indirect ownership
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Source: Energy Transfer LP and Shell US LNG, LLC
Energy Transfer Contacts:
Investor Relations:
William
Baerg, Brent Ratliff, Lyndsay Hannah, 214-981-0795
Media Relations:
Vicki Granado and Alexis Daniel,
214-840-5820
Shell Contacts:
Shell Media Relations
International:
+44 207 934 5550
Americas: +1 832 337 4355
Shell Investor Relations
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America: +1 832 337 2034