The Annova LNG project proposed by Chicago-based Exelon is still waiting on a permit decision from federal regulators, but recent filings with the U.S. Energy Department show that Enbridge acquired a 10.5 percent ownership stake in the proposed export terminal.
“This minority equity investment aligns with our strategic priority of maintaining a low-risk model that generates reliable, growing cash flow and dividends,” Enbridge said in a statement.
Financial terms were not disclosed but the ownership deal comes less than a year after Enbridge’s Houston office completed work on the Valley Crossing Pipeline, a $1.5 billion project to move natural gas from the Agua Dulce hub near Corpus Christi to the Port of Brownsville and then south of the border to Mexico.
Under the ownership deal, Exelon will remain as the project developer and operator of the proposed LNG export terminal.
“Enbridge is not considering, nor is it being considered, to operate the liquefaction and export facility,” the pipeline operator said.
Enbridge also is working with Houston’s NextDecade for another Brownsville project called Rio Grande LNG. They have an agreement for Enbridge to build a natural gas pipeline to the terminal if it ultimately moves forward.
As for Annova LNG, the company was launched in 2013 and is headquartered in Houston. Annova LNG is seeking permission from the Federal Energy Regulatory Commission to build a plant along the south shore of the Brownsville Ship Channel that will produce up to 6 million metric tons of LNG per year. The company’s application is in the final stages of review by FERC officials.
Following the Enbridge deal, Annova LNG is now owned by a consortium of four companies. Chicago utility company Exelon owns 80.55 percent while Enbridge now holds a 10.5 percent stake. Nebraska engineering, procurement and construction firm Kiewit and Kansas-based energy technology firm Black & Veatch each own 4.475 percent.
“All of those of investors have investment-grade balance sheets and that’s one of our key competitive advantages,” Annova LNG CEO Omar Khayum told the Houston Chronicle. “We have a team that is trustworthy, reliable and bankable.”
Annova LNG, Rio Grande LNG a third proposed proejct named Texas LNG face stiff opposition from a coalition of Rio Grande Valley shrimpers, fishermen, environmentalists, neighbors and communities working under the banner Save RGV From LNG.
The projects are still waiting on FERC permit decisions but environmental reviews expressed concern about the cumulative traffic, noise and habitat fragmentation they would have on the endangered ocelot, jaguarundi and aplomado falcon when combined with other projects in the area.
In its regulatory filings, Annova LNG said the company plans to use noise and pollution-reducing electric motors for its plant and to develop an 185-acre wildlife corridor. The company plans to build a concrete wall along the boundary of the wildlife corridor that will further reduce noise and light — and keep animals out of the plant.