The Louisiana LNG Boom
Louisiana is home to the largest liquefied natural gas (LNG) projects in the world.
Data from the Federal Energy Regulatory Commission (FERC) shows at least 17 new LNG projects currently approved and proposed for the Bayou State that are estimated to increase output by over 30 billion cubic feet per day (Bcf/d).
One such project being developed by Golden Pass Products is slated to spend $10 billion to expand LNG facilities in Sabine Pass, LA. Golden Pass, a private company owned jointly by ExxonMobil (NYSE: XOM) and state-owned Qatar Petroleum, says the project will create about 9,000 construction jobs over a five-year period and over 200 full-time positions once the facility opens.
And that’s just one project.
Developer Energy Transfer Partners (NYSE: ET) and Royal Dutch Shell (NYSE: RDS-A) have also recently laid out a project framework agreement to construct a new LNG export terminal that’s estimated to cost between $12 billion and $16 billion in Lake Charles, Louisiana. They estimate this project will create at least 5,000 jobs during the construction phase and 200 permanent jobs when fully operational.
Meanwhile, the Driftwood LNG project being developed by Tellurian (NASDAQ: TELL) is estimated to cost around $30 billion. This project includes building three new LNG storage tanks, three marine berths, nearly 100 miles of pipeline, three compressor stations, and other structures. Tellurian estimates the Driftwood project will support 6,400 construction jobs and 300 permanent jobs once complete.
Here are maps from the U.S. FERC of the approved and proposed LNG projects in the United States right now. It’s clear Louisiana is the center for a boom in economic activity from LNG.
Approved LNG Projects
Proposed LNG Projects
According to a recent report from Global Energy Monitor, America will invest over $500 billion in LNG projects
But the LNG boom isn’t only happening in America. The LNG boom is global.
According to GEM, more than $1.3 trillion is being invested right now in over 200 LNG terminal projects around the world.
GEM counts 202 LNG terminal projects currently in development, including 116 export terminals and 86 import terminals worldwide. The organization estimates that these new terminals will triple global LNG export capacity once completed.
With hundreds of billions of dollars being invested in LNG facilities all over the world, investors are just now starting to earn big rewards.
Shares of Cheniere Energy (NYSE: LNG) have increased over 150% since 2016.
Heck, in 2016, Tellurian was a penny stock! Today it commands a $1.7 billion market cap, having increased almost 2,600% in just three years.
A $1,000 investment in TELL in 2016 is worth over $25,000 today!
And remember, this is a market that's just now taking off.
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LNG producers like Cheniere and Tellurian have already paid regular folks just like you millions in profits. But there are still even bigger LNG investment opportunities lying in wait. Specifically, I'm talking about shipping the stuff.
See, the whole reason LNG even exists is because it's a much more affordable way to ship natural gas. Liquefied natural gas is just regular natural gas that's been cooled and condensed into a liquid.
In order to transport regular natural gas, pipelines are needed. And if you're transporting natural gas locally, pipelines are the best option. But if you want to ship natural gas overseas for export, LNG is the much more affordable option.
And America definitely wants to export its LNG.
Back in May, the European Commission reported that LNG imports from the U.S. increased by 272% since 2018. EC data showed record U.S. LNG imports in March of this year totaling 49 Bcf.
Following that, U.S. Energy Secretary Rick Perry signed two export orders that will more than double America's LNG exports to 112 Bcf by next year.
And on top of that, the EC said LNG imports could increase from there to 282 Bcf by 2023.
What all this means is the global LNG boom isn't just about production. The companies that own LNG carriers are also positioned for massive gains.
That's why energy investors like Chris DeHaemer are piling into LNG shipping companies right now.
DeHaemer is deep into one French company that owns and operates one of the largest fleets of LNG carriers. He says, "The global demand for LNG shipments is increasing at a rate so fast, there simply aren't enough ships in the world to transport all the natural gas."
In fact, this French company he's talking about is so busy that it's already contracted out through 2022. It has 16 multi-year contracts with Royal Dutch Shell alone — and a backlog of customer contracts worth over $3.4 billion. So it's no wonder this firm just posted recorded quarterly revenue.
There are no signs of slowdown for the LNG market in sight — only growth. I don't want to suck the wind out of DeHaemer's sails, but if you're interested in learning how you can invest in this company (and I don't see why you wouldn't be), you can check out a recent report DeHaemer published here.
In that report, DeHaemer tells much more about the company and explains how you can get France to pay for your retirement. Check it out here.
Until next time,
As an editor at Energy and Capital, Luke’s analysis and market research reach hundreds of thousands of investors every day. Luke is also a contributing editor of Angel Publishing’s Bull and Bust Report newsletter. There, he helps investors in leveraging the future supply-demand imbalance that he believes could be key to a cyclical upswing in the hard asset markets. For more on Luke, go to his editor’s page.
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