Energy Transfer has signed a project framework agreement (PFA) with Shell US LNG to accelerate the development of a proposed large-scale LNG export facility in Lake Charles, Louisiana, US.

The PFA is seen as a significant step in taking the Lake Charles LNG project closer to a potential final investment decision (FID).

If the companies make an FID on the project, Energy Transfer’s existing Lake Charles LNG import and regasification terminal would be converted into an LNG export facility.

The project is expected to have three LNG trains with a total liquefaction capacity of 16.45Mtpa to export US natural gas to customers in Asia, Europe and the Americas.

“We believe the combination of our assets and Shell’s LNG experience will create a platform for exporting natural gas from the US Gulf Coast to the global marketplace that is unmatched.”

Lake Charles LNG president Tom Mason said: “We believe the combination of our assets and Shell’s LNG experience will create a platform for exporting natural gas from the US Gulf Coast to the global marketplace that is unmatched.”

According to S&P Global Platts, the project was delayed due to various factors, including difficulty in signing sufficient long-term offtake agreements and the recent trade war between the US and China.

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Differences between Shell and Energy Transfer about costs and other issues also caused the delay, the trade publication added.

Shell and Energy Transfer have commenced talks with potential LNG engineering, procurement and contracting (EPC) companies for the project.

The partners expect to issue an invitation to tender (ITT) in the coming weeks.

Shell Lake Charles LNG vice-president Frederic Phipps said: “Lake Charles presents a material, competitive liquefaction project with the potential to provide Shell with an operated LNG export position on the US Gulf Coast by the time global supply is expected to tighten in the mid-2020s.”

Once the project is sanctioned, Shell will assume the role of construction manager and operator of the facility.

The decision to go ahead with the construction of the LNG project will be subject to assessment of the outcome of the EPC bidding process, project competitiveness and LNG market conditions.

During the construction phase, the project is expected to generate up to 5,000 jobs.

Energy Transfer expects to bring the project online in 2024 or 2025. The company owns a 50% stake in the Lake Charles LNG project and Shell holds the remaining 50%.