Energy Transfer (ET) said post-market Thursday that it is suspending development of its Lake Charles liquefied natural gas export facility in Louisiana to focus on allocating funds to natural gas pipeline infrastructure projects it believes provides superior risk/return profiles.
Energy Transfer (ET) executives became nervous about Lake Charles LNG in the final stretch of development because the company still sees itself as a pipeline operator rather than an LNG-focused company, Reuters reported, citing a person familiar with the project; the project was projected to have a liquefaction capacity of 16.45 million metric tons/year.
“There is quite a bit of capacity out there, and way too many projects. Some more projects will wither away,” energy consulting firm ADI Analytics executive Uday Turaga told Reuters.
The company had said previously it would approve a financial investment decision on the project only if it sold 80% of the project to equity partners.
Energy Transfer (ET) also said it would increase the transportation capacity of its Transwestern pipeline’s planned ~$5.6 billion expansion project in Arizona and New Mexico to meet significant demand growth in the region, including the potential to retire an/or convert coal-fired power plants to natural gas.
The Desert Southwest project’s mainline pipeline diameter will be raised to 48 inches from 42 inches, which will increase the project’s capacity to as much as 2.3 billion cf/day, depending on final compression configuration, the company said.