ExxonMobil To Spend $10B On LNG Export Facility In Texas
Zacks Investment Research | Feb 05, 2019 08:33PM ET
Exxon Mobil Corporation (NYSE:XOM) announced its final investment decision (FID) for Golden Pass LNG export project in Sabine Pass, TX.
In the development, ExxonMobil will have a 30% working interest, while its partner Qatar Petroleum is expected to hold the remaining 70%. The companies have decided to commence construction of the facility in the March quarter of 2019, while the project is anticipated to initiate operations in 2024.
The largest publicly traded energy player added that it will be allocating at least $50 billion for expanding and constructing its domestic manufacturing facilities in the next five years. ExxonMobil emphasized that the Golden Pass LNG export project is part of its five-year massive investment plan.
The Golden Pass terminal was initially constructed for importing natural gas. Now, ExxonMobil and its partner Qatar Petroleum have made a decision to convert the facility into an export terminal with an investment of roughly $10 billion. Hence, with the commencement of the project, the companies will be able to export natural gas produced from the prolific domestic shale fields.
Every year, the development will be capable of producing roughly 16 million tons of LNG, added the integrated energy majors. Through the project’s construction phase of roughly five years, ExxonMobil and Qatar Petroleum have planned to generate approximately 9,000 jobs. Further, the project is anticipated to create at least 200 permanent jobs once it gets operational.
An independent study has estimated that the Golden Pass LNG export development will be able to create direct tax revenues of roughly $4.6 billion in federal, state and local levels. The project will also provide economic gains of $31 billion to the domestic market, per the study.
Investors should know that ExxonMobil and Qatar Petroleum are collaborating to explore and develop resources in Brazil, Mozambique and Argentina. Hence, the latest project will strengthen the relationship between the companies.
Headquartered in Irving, TX, ExxonMobilcurrently carries a Zacks Rank #5 (Strong Sell). A few better-ranked stocks in the energy space are Jones Energy, Inc. (OTC:JONE) , Golar LNG Partners LP (NASDAQ:GMLP) and Sunoco LP (NYSE:SUN) . Jonescarries a Zacks Rank #2 (Buy), while Golar LNG and Sunoco sport a Zacks Rank #1 (Strong Buy). You can see Zacks Investment Research
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