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BG Group makes early move on U.S. gas

Oct. 27, 2011 at 8:08 AM   |   Comments

LONDON, Oct. 27 (UPI) -- British energy company BG Group said a deal for liquefied natural gas from the United States gives it an early edge in an emerging energy market.

BG announced it signed a 20-year sale and purchase agreement with Sabine Gas Liquefaction, a subsidiary of Cheniere Energy Partners, for 3.5 million tons of liquefied natural gas a year from terminals in Louisiana.

"This is a ground-breaking agreement for BG Group, giving us first-mover advantage in securing LNG export volumes from the U.S. Gulf Coast," BG Group Chief Executive Frank Chapman said in a statement.

"It is the first agreement of its kind in this region and it secures us early access to the rapidly emerging commercial opportunities driven by the recent material increases in U.S. gas reserves."

BG Group added it won approval from the U.S. Department of Energy to export around 730 billion cubic feet of natural gas from an LNG terminal in the U.S. South to countries that have free trade agreements with the United States.

Lower gas prices in the United States create a commercial opportunity for BG Group.

Construction for Sabine Pass LNG facilities begins next year. Exports should start in 2015.

© 2011 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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