December 2024, Vol. 251, No. 12
Global News
Global News December 2024
Golden Pass LNG Gets 3-Year Extension for Construction
Federal regulators gave a three-year extension to an Exxon Mobil and Qatar Energy LNG project so it can finish construction of the Golden Pass LNG plant, a regulatory document showed.
The extension became necessary when lead construction contractor Zachry Holdings filed for bankruptcy in March, according to a FERC filing.
At P&GJ deadline, Golden Pass has not announced a new EPC contractor and has been in negotiations with McDermott International as lead contractor.
The project, at the Sabine Pass site of a former gas-import terminal, is one of two large U.S. LNG facilities that are expected to significantly expand supplies from the world’s top exporter of the super-chilled fuel within the next year.
Zachry Holdings filed for Chapter 11 bankruptcy protection, saying the Golden Pass project was at least $2.4 billion over the original budget.
EQT, Blackstone Forge Deal for Mountain Valley Stake
EQT Corporation announced a $3.5 billion joint venture (JV) with Blackstone Credit & Insurance (BXCI) focused on midstream assets, including stakes in the Mountain Valley Pipeline (MVP) and the Hammerhead Pipeline.
The deal is set to close by this year and underscores EQT’s strategic push to strengthen infrastructure and reduce debt.
Under the agreement, BXCI will acquire a non-controlling equity interest, valuing the JV at $8.8 billion. EQT will use proceeds to reduce debt, aiming to end 2024 with about $9 billion in net debt. The partnership also secures EQT's long-term growth in projects like the MVP expansion and MVP Southgate.
“This transaction underscores the ultra-high-quality nature of EQT’s regulated midstream assets,” said EQT CEO Toby Z. Rice. “We look forward to working with Blackstone to optimize the value of these assets.”
The Hammerhead Pipeline plays a pivotal role in this venture. The pipeline is a 1.6 billion cubic feet per day gathering header pipeline primarily designed to connect natural gas produced in Pennsylvania and West Virginia to MVP, Texas Eastern Transmission and Eastern Gas Transmission.
Martin Midstream Backs Buyout in Face of Opposition Bid
Martin Midstream Partners said it supports the planned takeover by its largest shareholder, after two hedge funds, which made a competing bid.
Martin Midstream, which focuses on storing and transporting fuels, agreed to a $157 million deal with Martin Resource Management Corp (MRMC). Under the terms, MRMC will pay $4.02 per unit in cash for the common units it does not already own, after initially offering in May to acquire Martin Midstream for $3.05 per unit.
MRMC holds 15.7% of the common units of Martin Midstream.
The hedge funds face an uphill battle to block the MRMC deal, because unit-holders allied with MRMC, representing 26% of the common units, have committed to vote in favor. The transaction requires the approval of the holders of a majority of the outstanding common units of Martin Midstream.
India’s GAIL Seeks Long-Term LNG Capacity Deals
GAIL (India) is looking for importation deals for LNG, which in total would amounting to 5.5 mtpa. If successful, that would increase its capacity to 21 mtpa by 2030.
India’s largest gas pipeline utility currently holds LNG supply deals of 15.53 mtpa, after signing contracts with trader Vitol and ADNOC.
GAIL expect to raise loans of $475.9 million (40 billion rupees) in this financial year to fund the pipeline network expansion and boost petrochemicals capacity, Financial Chief Rakesh Kumar Jain told Reuters.
GAIL will consider raising the debt from foreign markets if that proves cheaper than rupee-denominated loans, Jain added, he added.
Lyondell Major U.S. Oil Refinery Shutting Down
Chemical maker LyondellBasell Industries will go ahead with its plan to permanently shutter its 263,776 bpd Houston oil refinery in the first quarter of 2025.
The move is the latest U.S. refinery closures, sparked by the expected decline in demand for motor fuels, prompted by competition for electric automation and renewable fuels.
In January, one of the facility’s crude distillation units (CDU) and coker production train will shut. In February, the second CDU-coker production train, which supplies the gasoline-producing fluidic catalytic cracker (FCC) and ancillary units, will close, the company said.
Venezuela’s Oil Exports Surge Amid Demand from U.S., India
Oil exports from Venezuela climbed to a four-year peak – almost 950,000 bpd in October, spurred by growing crude output and more sales to India and the United States, according to data from state firm PDVSA.
The increase happened despite a large storage terminal fire last month, tighter U.S. sanctions since June and the arrest of the country's former oil minister, Pedro Tellechea, and former PDVSA executives over corruption allegations.
A bounce in crude production, mainly due to the stabilization of processing operations at Venezuela's largest oil region, the Orinoco Belt, has allowed the recovery of heavy crude inventories, the PDVSA documents showed.
In total, PDVSA and its joint ventures exported an average of 947,387 bbl/d of crude and fuel, 21% over the previous month and the highest monthly figure since early 2020, according to the data, based on tanker movements.
The South American country, which has remained under U.S. sanctions since 2019, also exported 314,500 metric tons of oil byproducts and petrochemicals, slightly more than the 267,000 tons of September.
Crude shipments by Chevron to the United States reached a peak of 280,000 bbl/d, the highest since the U.S. producer resumed exports of Venezuela's heavy grades early last year. Spanish producer Repsol also exported Venezuelan oil cargoes to the U.S. and Spain last month.
PDVSA increased exports to India, which used to be a top market before the sanctions, sending three cargoes, or about 141,000 bbl/d, last month, the data showed.
Crude deliveries to the U.S., Europe and India are authorized under U.S. licenses to some PDVSA's joint venture partners and customers, including Chevron, Repsol, Eni, Maurel & Prom, and Reliance Industries.
However, China remained the main destination of Venezuela's oil exports in October with 385,300 bbl/d shipped to the world's top oil importer directly and indirectly. Exports to China had been higher in September, when they averaged some 451,500 bbl/d.
Venezuela's exports to political ally Cuba, which is struggling to overcome an acute energy crisis, slightly rose to 28,000 bbl/d, from 22,000 bbl/d in September.
Venezuela also saw an increase in fuel imports to 81,000 bpd, from 67,000 bbl/d the previous month, according to the data.
OPAL Fuels Launches RNG Operations at Florida Landfill
OPAL Fuels begun commercial operations at its RNG facility, located at the Polk County municipal landfill in Jones Corner, Florida.
This marks the company's eleventh operational RNG project and its second facility in the state. The landfill, owned and operated by Polk County’s municipal government, now supplies biogas for OPAL’s project, which produces and injects pipeline-quality RNG.
With a design capacity of 1.1 MMBtu (8.5 million gasoline gallon equivalents) of RNG per year, the facility aims to replace diesel transportation fuel. This shift is expected to lower fleet operating costs and significantly reduce greenhouse gas emissions, equivalent to eliminating Scope 1 and Scope 2 emissions from over 900 heavy-duty trucks.
Enterprise Products Acquires Piñon Midstream
Enterprise Products’ earlier announced acquisition of Piñon Midstream has concluded. The acquisition was a $950 million cash consideration, as part of a debt-free transaction.
The acquired assets include natural gas gathering and treating services, focused in the Delaware Basin in Texas and New Mexico.
This is added to existing assets in Enterprise Products’ portfolio, including varied gathering, processing and storage services for both natural gas and crude oil, as well as 50,000 mi of pipelines and 300 million barrels of liquids storage and 14 Bcf natural gas storage.
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