Chesapeake Energy advances with Southwestern acquisition as quarterly earnings hit by weak market dynamics
Chesapeake Energy Corp., the US natural gas producer with LNG interests and currently completing a merger with Southwestern Energy to create one of America’s biggest natural gas companies, reported a slump in profits and revenues in the first quarter, citing weak market dynamics.
Driftwood Pipeline project advances to provide feed gas for Louisiana LNG near Lake Charles export hub
The $1.5-billion US Driftwood Pipeline project comprising two feed-gas lines for the liquefied natural gas export plant in Louisiana has been formally approved by regulators.
Tellurian, the Driftwood project developer, said in a statement that the pipelines, known as Line 200 and Line 300, would be constructed in Beauregard Parish and Calcasieu Parish in the Gulf Coast state.
The Houston, Texas-based company, said the pipelines would be capable of delivering up to 5.5 billion cubic feet of natural gas per day.
Tellurian said the pipelines would have “virtually no emissions” due to the implementation of electric-powered Integrated Compressor Line (ICL) technology from US energy technology and services company Baker Hughes.
The company said the permits were awarded by the Federal Energy Regulatory Commission on April 21.
Bechtel contract
Leading US LNG engineering company Bechtel Energy has already been given limited notice to proceed with construction of Phase One of the Driftwood liquefaction plant.
The Tellurian project involves constructing 20 mid-scale processing Trains, each with 1.38 MTPA of capacity and built as five blocks of four Trains.
The Phase One development would include the first two of these blocks with 11 MTPA of output and two of three planned 235,000 cubic metres storage tanks and the first of three planned loading berths for LNG carriers.
“Tellurian thanks the FERC for their thorough and collaborative review of our Driftwood Pipeline Project and we look forward to delivering natural gas in a cleaner and highly reliable way to Southwest Louisiana,” said Tellurian President and Chief Executive Octávio Simões.
Earlier in April, Tellurian signed an accord to sell the site of the Driftwood plant near Lake Charles to New York-based institutional investors.
Tellurian said that the sale and lease back deal had been the subject of a binding letter of intent for the 800 acres of land owned by Tellurian’s subsidiary, Driftwood LNG LLC.
Master lease
The agreement will see Tellurian receiving $1 billion for the land and a lease.
“It will consist of the sale by Driftwood LNG and purchase by a special purpose entity to be formed by the investor of Driftwood LNG’s interests in the property for $1.0Bln pursuant to a purchase and sale agreement,” said Tellurian.
On the closing of the transaction a 40-year lease of the property from the purchaser to Driftwood LNG will be signed in the form of a master lease.
There is also a requirement that the equity investors in Driftwood LNG become joint and contingent guarantors of the master lease.
Largest Permian acreage holder Pioneer Natural Resources reports $7.8Bln profits and more spending
Pioneer Natural Resources, the biggest Texas oil producer and the largest acreage holder in the oil and gas-rich Permian Basin of the southwest US, reported fourth-quarter profits that were better than expected and said it would push ahead with drilling, completions, facilities and water infrastructure spending of up to $4.75 billion in 2023.
EIA Gas Report forecasts new investment in US shale-gas production to support LNG export capacity
Global natural gas demand is expected to rise by 3.6 percent in 2021 before easing to an average growth rate of 1.7 percent over the following three years, though by 2024 demand is forecast to be up 7 percent from 2019 pre-Covid-19 levels, according to the latest quarterly Gas Market Report from the Paris-based International Energy Agency.
