Energy Transfer LP has indefinitely paused the under-development Lake Charles LNG project in Louisiana to refocus investment on natural gas pipelines.
The pause allows the Dallas, Texas-based company to “focus on allocating capital to its significant backlog of natural gas pipeline infrastructure projects that Energy Transfer believes provide superior risk/return profiles”, it said in a statement on its website.
“Energy Transfer management has determined that its continued development of the project is not warranted by Energy Transfer but remains open to discussions with third parties who may have an interest in developing the project”.
Earlier this year the United States Department of Energy (DOE) granted Energy Transfer’s request to extend the deadline for Lake Charles LNG to start exports from 2025 to 2031.
Lake Charles LNG is permitted to export a cumulative 851 billion cubic feet a year of natural gas equivalent, under two DOE orders originally issued July 2016 and June 2017.
Energy Transfer says the project, a conversion from an existing regasification site, has all authorizations from the Federal Energy Regulatory Commission. In September 2024, it awarded an engineering, procurement and construction contract to a joint venture between KBR Inc and Technip Energies NV.
Concurrent with the pause announcement, Energy Transfer said it has increased the capacity of the Transwestern Pipeline’s planned Desert Southwest expansion project.
“To meet the need for additional capacity identified through a recent open season, the project’s mainline pipeline diameter will be upsized from 42 inches to 48 inches, which will increase the project’s capacity to up to 2.3 billion cubic feet per day, depending on final compression configuration”, Energy Transfer said in a separate statement.
“There is significant demand growth in the Desert Southwest region, including the potential to retire and or convert coal-fired power plants to natural gas, which could further benefit the project.
“The ultimate capacity of the Desert Southwest expansion project will be based on market demand”.
Energy Transfer still expects to put the expansion into service by 2029.
“The upsized project is now expected to cost up to approximately $5.6 billion excluding Allowance for Funds Used During Construction”, Energy Transfer said. “As a result, Energy Transfer’s total growth capital expenditures for 2026 are expected to increase by approximately $200 million”.
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