Exxon Mobil (NYSE: XOM) is teaming up with Qatar Petroleum to make a roughly $10 billion investment in American natural gas exports in Texas. The companies are planning to turn Golden Pass, a facility in Texas built to import gas, into an export hub for shale gas extracted from fields in the southern U.S. The facility was built about a decade ago at a cost of roughly $2 billion, but has been dormant for the last eight years.
According to reports, the companies are planning to reverse some pipelines and add several refrigerant plants to the location. The expanded terminal would have the capacity to produce about 16 million tons of LNG per year. Over a planned five years of construction, Golden Pass is expected to create about 9,000 jobs, with 200 of the positions being permanent. The facility is expected to start up in 2024.
Qatar Petroleum will own 70 percent of the project, with Exxon Mobil in the position of junior partner. The deal is designed in part to strengthen Qatar’s ties with the United States. It would also give the company quicker access to Latin America at a lower cost. The two companies have also collaborated on projects in Argentina, Brazil, and Mozambique.
Qatar Petroleum is already the biggest liquefied natural gas exporter in the world. Qatar Petroleum is also expanding in Argentina, Brazil, Cyprus, Mexico, Morocco, Mozambique, and South Africa. Last year, the United States became the fastest growing exporter of liquefied natural gas. The Energy Department approved exports from Golden Pass in 2017.
Saudi Arabia and its allies launched a trade embargo against Qatar nearly two years ago. Qatar removed investments from countries around the Middle East in retaliation. The country also announced in December that it was resigning its membership in the Organization of the Petroleum Exporting Countries (OPEC). President Trump’s administration has attempted to mediate the dispute, but progress has been slow at best.