Shell has pulled out of a major US LNG project to convert an existing import terminal in Lake Charles, Louisiana to an export facility, citing “current market conditions”.
Lake Charles LNG is a 50-50 venture with Energy Transfer, who will now take over as the project developer, Shell said in a statement.
Shell said it will continue to support Energy Transfer with the ongoing bidding process for the engineering, procurement, and construction contract and then plan a phased handover of the project’s remaining activities.
“This decision is consistent with the initiatives we announced last week to preserve cash and reinforce the resilience of our business,” said Maarten Wetselaar, Director, Integrated Gas and New Energies, Shell.
“Whilst we continue to believe in the long-term viability and advantages of the project, the time is not right for Shell to invest.”
“Through the transition, we will work closely with Energy Transfer.”
The Lake Charles LNG project has a proposed liquefaction capacity of 16.45 mtpa for US natural gas export to global customers.
In addition to its brownfield advantages and permits, the project has an existing pipeline infrastructure.
Shell entered the project in its 2016 combination with BG Group plc.