Australia-based Woodside Energy Ltd. has decided not to invest in Sempra Energy's proposed Port Arthur, TX, liquefied natural gas (LNG) project, but plans are moving forward toward a final investment decision (FID) next year, a spokesperson said.
The anticipated returns from the multi-billion-dollar project apparently were not high enough to interest the Australia-based conglomerate.
Sempra LNG & Midstream spokesperson Paty Ortega Mitchell told NGI late Thursday that Sempra would continue to lead the development. Woodside had collaborated "on certain elements" of the project since joining it in 2016.
"Woodside has been evaluating whether to invest equity in the project, but has recently decided not to pursue that investment further as it wishes to focus on integrated exploration and production, rather than U.S. Gulf Coast LNG infrastructure investments," Ortega Mitchell said.
Sempra continues to view the Port Arthur project as a "highly attractive opportunity" to export gas to global markets. Earlier this year, Sempra executives described an uptick in the global gas market, which they said could create a windfall in the 2020s.
Sempra LNG is "fully committed" to the Port Arthur project, Ortega Mitchell said. She noted that Bechtel earlier this year was selected as the engineering procurement and construction (EPC) contractor. A long-term supply contract and a memorandum of understanding with other potential buyers also are in place, she said.
"We continue to work with these parties and are in discussions with many other LNG buyers from Europe and Asia” concerning the Port Arthur project,” which includes “LNG purchases and a potential equity investment. This is an important part of our North American LNG strategy, and we are targeting FID in 2019, with first production in 2023."
Sempra is also involved in two other LNG projects -- on the U.S. Gulf Coast in Louisiana and on the Pacific coast in northern Mexico.
Cameron LNG, located in Hackberry, LA, is in the final stages of construction, and the company expects that all three trains at the terminal will be producing in 2019. Two additional trains are planned in the long-term. Meanwhile, Sempra selected an EPC contractor for its Energia Costa Azul LNG import terminal last month. The facility will be located in Mexico's Baja California Norte state.