The Rising Influence of Rising Affluence

[DewDiligence]

Shell joins with KMI to build LNG-export terminal in Savannah, GA:

The Georgia export project would need U.S. permission to export to countries with which the U.S. doesn't have free-trade agreements, and the companies must finalize investment decisions. But due to Shell's deep pockets and its experience in the LNG business, the effort could stand out amid 20 or so different projects awaiting permits to sell LNG to non-FTA countries. So far only one project, Cheniere Energy Inc.'s LNG -0.62% Louisiana terminal, is authorized for exports and is under construction.

Shell and Houston-based Kinder Morgan said that they would seek to modify El Paso Pipeline Partners LP's Elba Express Pipeline unit and the Elba Island LNG Terminal to move natural gas to the terminal, liquefy it and ship it. El Paso, a Kinder Morgan unit, will own 51% of the partnership and run the facility, and Shell will own 49% and have rights to 100% of the liquefaction capacity of the terminal. The project is expected to be able to ship 350 million cubic feet of gas per day.

The project will cost about $1B, according to Shell, which is small potatoes for a company that spent $19B on the Pearl GTL plant!