A subsidiary of El Paso Corp. agreed to acquire a 50% interest in the Gulf LNG Clean Energy Project, a planned liquefied natural gas (LNG) terminal in Pascagoula, MS. An El Paso subsidiary also will operate the terminal and will manage its construction, the company said last week. The terminal is expected to be placed in service in late 2011 at an estimated cost of $1.1 billion.
The Crest Group, consisting of Houston-based investors, will own 30% of the project; and Sonangol USA will own 20%. Sonangol is the state-owned national oil company of Angola. The agreement for El Paso to acquire an interest in the project from the Crest Group and Sonangol is subject to certain terms.
"We are pleased to extend our presence and expertise in the LNG terminal business through the Gulf LNG project," said Norman G. Holmes, chief commercial officer of El Paso subsidiary Southern Natural Gas Co.
The project, which received its Federal Energy Regulatory Commission certificate in February, includes the construction of two 160,000-cubic-meter storage tanks with a combined capacity of 6.6 Bcf; 10 vaporizers, providing a base sendout capacity of 1.3 Bcf/d; and five miles of 36-inch diameter pipeline, connecting the terminal to the Gulfstream, Destin, Florida Gas Transmission and Transco pipelines.
Transco recently held an open season for its Pascagoula expansion project, which is designed to connect the pipeline with Gulf LNG (see NGI, Nov. 5).
Gulf LNG has negotiated 20-year firm service agreements for all of the capacity of the terminal with a group of LNG producers, including several major oil and gas companies.
El Paso owns one of four currently operating land-based LNG regasification terminals in the U.S., the one at Elba Island near Savannah, GA.
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