WASHINGTON, Feb 5 (Reuters) - Qatar Petroleum and Exxon Mobil Corp will proceed with a $10 billion project to expand a liquefied natural gas (LNG) export plant in Texas, Exxon said on Tuesday.
Construction of the Golden Pass LNG project, in Sabine Pass, Texas, is expected to begin in early 2019. The project will add production capacity of around 16 million tonnes of LNG per year after it starts up in 2024.
Reuters had first reported details of the deal on Feb. 1, based on sources familiar with the matter.
“Golden Pass will provide an increased, reliable, long-term supply of liquefied natural gas to global gas markets, stimulate local growth and create thousands of jobs,” said Exxon Chief Executive Darren Woods in a press release.
Executives from Exxon and Qatar Petroleum were due to make a joint announcement with U.S. Energy Secretary Rick Perry Tuesday afternoon, the Energy Department said on Monday.
Worldwide consumption of LNG is expected to more than double to 550 million tonnes a year (mtpa) by 2030, triggering a race among oil and gas companies eager to dominate the market.
The expansion is part of Qatar Petroleum’s plans to invest about $20 billion in the United States as the company seeks to increase its overseas oil and gas business.
Qatar, a tiny but wealthy country, is one of the most influential players in the LNG market with annual production of 77 million tonnes. It plans to boost capacity 43 percent by 2023-2024.
Currently, Exxon has a 30 percent stake in Golden Pass and Qatar Petroleum holds a 70 percent stake. The two have been strengthening a global alliance across LNG projects from the United States to Mozambique.
The Golden Pass project is one of many that could be approved this year. Companies are expected to make final decisions on projects that could add more than 60 million tonnes per annum of LNG capacity this year.
Qatar left the Organization of the Petroleum Exporting Countries last year, allowing it to expand in the United States without concerns about proposed legislation that could limit OPEC members’ investments in the country. (Reporting by Timothy Gardner; Editing by Steve Orlofsky)