HOUSTON — Citing market conditions, Shell has announced it will not proceed with an equity interest in the proposed Lake Charles LNG project in Louisiana.
A March 30 statement said Shell will continue to support the remaining investor, Energy Transfer, in the bidding process for the engineering, procurement and construction contract and then plan a phased handover of the project’s remaining activities.
Shell had been a 50/50 partner with Energy Transfer.
The project seeks to convert Energy Transfer’s existing import terminal to an LNG export facility in Lake Charles, La.
“This decision is consistent with the initiatives we announced last week to preserve cash and reinforce the resilience of our business,” said Maarten Wetselaar, Shell’s director of integrated gas and new energies. “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.”
Shell announced recently it is reducing its 2020 capital expenditure to USD$20 billion, or below, from a planned level of around $25 billion, in addition to an operating cost reduction of $3- to 4-billion over the next 12 months.
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