Energy transportation giant Enbridge Inc. will be going ahead with two pipeline projects to service a new liquefied natural gas facility in the U.S., part of the Canadian company’s push to grow its LNG business as global demand soars.
The Calgary-based pipeline company announced Thursday it will transport 1.5 billion cubic feet per day of natural gas from basins in the U.S. to Venture Global’s recently sanctioned Plaquemines LNG plant in Plaquemines Parish, Louisiana.
U.S.-based LNG company Venture Global announced on Wednesday that it will go ahead with the first phase of construction of the Plaquemines LNG facility, after securing US$13.2 billion in financing.
According to Venture Global — whose first LNG facility, also in Louisiana, began exporting earlier this year — that figure represents the largest project financing transaction that has closed so far this year.
Enbridge said its two pipelines that will supply the facility are the 43-km Gator Express Meter Project, expected to be in service in 2023, and the 4.8-km Venice Extension Project, expected to be in service in 2024. The estimated cost for the two projects is US$400 million, underpinned by long-term contracts, the company said.
The announcement comes as U.S. benchmark natural gas prices topped US$9 per mmBTU this week amid concerns about global energy security and the war in Ukraine.
Enbridge chief executive Al Monaco has been vocal in recent months about his belief that natural gas exports represent the largest opportunity for North America right now, and he has said that Enbridge is seeing a strong pick up in commercial interest from Asia and Europe to secure export capacity.
The Plaquemines facility, which will have an export capacity of up to 20 million metric tonnes of LNG per year when fully developed, will be the fifth LNG facility on the U.S. Gulf Coast served by Enbridge pipelines. The company currently serves four operating LNG facilities in the region, and Monaco said earlier this month that it has secured projects to serve two additional proposed facilities (Rio Grande and Texas LNG) if they go ahead.
In addition to LNG, Enbridge is also banking on increased crude oil exports from the U.S. Gulf Coast. Last fall, it acquired U.S.-based terminal and logistics company Moda Midstream Operating LLC for US$3 billion.
As part of the deal, Enbridge acquired North America’s largest crude export terminal, the Ingleside Energy Center located near Corpus Christi, Texas, which handles about 25 per cent of all U.S. Gulf Coast crude exports.
© 2022 The Canadian Press
View original article here Source