Qatar Petroleum, ExxonMobil in $10-bn LNG export project
06 February 2019
US oil giant ExxonMobil Corporation and partner Qatar Petroleum on Tuesday announced plans to proceed with joint development of the Golden Pass LNG export project located in Sabine Pass, Texas.
The $10+ billion liquefaction project will have capacity to produce around 16 million tons of LNG per year. Construction will begin in the first quarter of 2019 and the facility is expected to start up in 2024.
It is expected to create about 9,000 jobs over the five-year construction period and more than 200 permanent jobs during operations. Preliminary estimates by an independent study indicate the project could generate up to $31 billion in US economic gains and more than $4.6 billion in direct federal, state and local tax revenues over the life of the project.
“Golden Pass will provide an increased, reliable, long-term supply of liquefied natural gas to global gas markets, stimulate local growth and create thousands of jobs,” said Darren Woods, chairman and chief executive officer of Exxon Mobil Corporation.
Woods and Qatar Minister of State for Energy Affairs Saad al-Kaabi signed the deal at the Four Seasons hotel in Washington in the presence of US Energy Secretary Rick Perry.
The deal is proof that two of the world’s top energy producers can work together and “support rather than subvert an open energy marketplace,” Perry said.
Golden Pass is part of ExxonMobil’s plans to invest more than $50 billion over the next five years to build and expand manufacturing facilities in the US. This includes the `Growing the Gulf’ initiative, which will create about 45,000 jobs in America, Exxon Mobil stated in a release.
The Trump administration is promoting gas drilling and LNG exports in part to offer European customers alternatives to piped natural gas from Russia, while also lifting Obama-era environmental regulations on energy operations.
Qatar petroleum will have 70 per cent working interest in the Golden Pass LNG export project with ExxonMobil owning the remaining 30 per cent.
ExxonMobil and Qatar Petroleum are already into joint exploration and development activities in Argentina, Brazil and Mozambique.
Global LNG consumption is expected to more than double to 550 million tonnes a year (mtpa) by 2030 with more nations shifting to cleaner fuels.
Qatar Petroleum had announced plans to invest about $20 billion in the United States as the company seeks to increase its overseas oil and gas business.
Tiny Qatar is one of the most influential players in the LNG market with annual production of 77 million tonnes. It plans to boost capacity 43 per cent by 2023-2024.
ExxonMobil, the largest publicly traded international oil and gas company, holds an industry-leading inventory of resources, and is one of the largest refiners and marketers of petroleum products, and its chemical company is one of the largest in the world.