Oil price claims LNG project

A FLOATING 8 million tonne per annum export plant being built by Excelerate Energy in Texas has been shelved, worsening fears for other American projects in the same decreased oil price-fuelled predicament.

The project was originally planned to begin production in 2018 but was recently put on hold through a submission to the US Federal Energy Regulatory Commission, according to Reuters.

Excelerate reportedly referred to a forced "strategic reconsideration of the economic value of the project" due to the steep decrease in the oil price.

The project suspension has been flagged for review on April 1, 2015.

There are thirteen other US LNG projects which have also not signed up enough international buyers to reach a final investment decision, leaving significant doubt as to the future of those undertakings.

Cheniere's Sabine Pass and Sempra's Cameron LNG projects managed to hit the all important milestone, according to Reuters.

Growing supply and decreased demand in the Asian market led to the halving of LNG spot prices this year, while Japan, South Korea and China are seeking to offload some of their long-term LNG supply commitments, making the problem worse.

Execelerate reportedly said that only "renewed interest of potential counterparties" could get its project moving again.

loader

Most read MARKETS