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Texas facilities get green light to export LNG. US export capacity is expected to almost double over the next 5 years. An EIA report shows natural gas exports reaching 4.6 Bcf/D in February, the 13th consecutive month in which the country's natural gas exports exceeded its imports. Exports are projected to reach 7.5 Bcf/D by 2020. The shale revolution is leading the US into a unique position: a bigger exporter of crude and petroleum liquids than the Kingdom of Saudi Arabia.
The deal sees H2O Midstream increase its produced water gathering network to more than 435,000 B/D of disposal capacity and 190 total miles of pipeline. The Permian water midstream company will add more than 40,000 B/D of recycling capacity with the option to double that capacity over time. The pipeline system will have the initial capacity to deliver 150,000 B/D of crude oil to multiple delivery points, accessing local refineries and connecting to several downstream pipelines. ExxonMobil announced an enhanced program to reduce methane emissions from its production and midstream facilities across the US. The program includes a commitment to switch out more than 1,000 high-bleed pneumatic devices over 3 years.
As part of a deal that could net up to $3 billion, GE will lose majority control of Baker Hughes just two years after it acquired the oilfield service company. The reciprocating compression division manufactures and services compression and engine systems that are used in a variety of applications, including the transmission of natural gas across domestic and international pipelines. New analysis from Rystad Energy shows service companies are beginning to raise prices after seeing a significant drop following the oil price downturn. Pricing power is projected to keep rising in 2020 as the service industry sees more demand across the supply chain. Drones will be just one of the tools that the service company uses in its drive toward net-zero carbon emissions.
ADNOC and CNOOC will explore multiple new opportunities for collaboration across the upstream and downstream sectors in the UAE and China. The deal calls for CNOOC to get 1.5 mtpa of gas from the Anadarko-operated Mozambique LNG project over the next 13 years. The project is the first onshore LNG development for the coastal East African nation. The Hess-operated field, which drew first oil in January, is expected to produce 80,000 BOPD as production ramps up this year.
The US Forest Service, which is working with FERC to prepare the review of the export terminal off the Oregon coast, said it only recently received critical information needed to complete amendments to its land and resource management plans. First gas is scheduled for 2025. Calgary-based Pembina Pipeline Corp. has entered into agreements to acquire Kinder Morgan Canada Ltd. and the US portion of the Cochin Pipeline system from Kinder Morgan for a total purchase price of approximately $4.35 billion.
The unseasonably warm weather in the northern hemisphere and the rise of the global supply levels has resulted in record-low LNG prices. Adding to that, the coronavirus epidemic in China has reduced business and industrial activity, with January’s LNG imports dropping by about 10% year on year. In a filing with the US FERC, Plains All American Pipeline said it would begin charging shippers an additional fee on its Cactus II pipeline to offset higher construction costs incurred in the wake of US steel tariffs. Louisiana state granted a tax incentive to LNG Ltd. for its Magnolia project in Lake Charles. The decision may alleviate some of the pressures oil and gas producers faced in the wake of their imposition last year.
Phillips and Trafigura JV expected to load VLCCs. The project is in the permitting stage with an FID expected this year. Phillips 66 Partners Takes 50% Interest in $1.6-Billion Liberty Pipeline Project The transaction is expected to close in March. The Liberty Pipeline runs 700 miles between Cushing, Oklahoma and Guernsey, Wyoming. Phillips 66 and partners in two separate joint ventures are building the Red Oak and the Liberty pipeline systems to deliver a total of approximately 750,000 BOPD to the US Gulf Coast with startup of service in early 2021.
This is the second EPC contract Bechtel signed for Port Arthur LNG. Final investment decision is expected this year. Approximately $200 billion in projects worldwide are racing to be approved over the next 2 years. The race is not just to make FIDs on projects, but also to enter FEED work to lock in contractors before others do. Sabine Pass Train 6 gets the nod, Bechtel gets the go-ahead for construction.
This is the second EPC contract Bechtel signed for Port Arthur LNG. Final investment decision is expected this year. The agreement comes 8 months after Saudi Aramco agreed to take a 25% ownership interest in the southeast Texas project. Phase 1 of the project is expected to produce 11 mtpa of LNG. The deal with project developer Sempra includes Saudi Aramco netting 5 mtpa of LNG offtake and a 25% equity stake in Phase 1 of the export terminal, which may reach FID later this year.