Cheniere’s Sabine Pass facility has been expanding since its production began in 2016 but needs additional natural gas beyond current supplies to reach its planned “Stage 5” capacity, top company officials said.

“We will likely build a pipeline to where we can access other pipelines. That will get us Haynesville (shale gas), any additional Marcellus (gas) that will come down, mid-continent, Permian as well as Eagleford as it continues to be developed,” Corey Grindal, Cheniere’s chief operating officer, told journalists last week.

Cheniere previously retooled some of its pipeline infrastructure to send gas to its Sabine Pass facility in Louisiana, but those pipelines now shoulder additional demand and are unavailable, Grindal said.

The exporter already spends $800 million a year in pipeline transit fees to transport 7.5 billion cubic feet per day (bcfd) of natural gas from 26 different pipelines to its LNG plants in Texas and Louisiana, CEO Jack Fusco also said in the interview with reporters at an LNG conference in Vancouver. He gave no detail about the new pipeline’s cost or size.

Oren Pilant, a pipeline analyst with midstream industry experts East Daley Analytics, said the project likely requires a small header system that aggregates gas from several lines.

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The renewal would allow the supervisory board that oversees Citgo to continue efforts to reach settlements with nearly a dozen firms seeking an auction of shares in the parent of the seventh-largest U.S. oil refiner.

A negotiating team representing the South American country has held settlement talks with some of those creditors and holders of defaulted PDVSA bonds.

The U.S. has shielded Houston-based Citgo from creditors since the company in 2019 severed ties with its ultimate parent, Venezuela’s state oil firm Petroleos de Venezuela, which is controlled by President Nicolas Maduro.

Wednesday’s Treasury license bars transactions in PDVSA debt through Oct. 19.

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Oil and gas prices came under pressure during the April-June quarter as rising interest rates in key economies and a slower-than-expected manufacturing and consumption recovery in China dented fuel demand.

Energy output has yet not reached pre-pandemic levels as companies have kept a tight rein on production, also pressuring pipeline operators’ transport volumes.

Kinder Morgan faced lower commodity prices, higher interest expense in the second quarter as well as higher sustaining capital expenditures versus the prior year period, President Kim Dang said.

The Houston-based company said earnings from its products pipelines fell about 4.3% to $286 million, while earnings from the transportation of CO2 fell about 17.4% to $175 million, due to lower realized prices.

Kinder Morgan’s revenue fell about 32% to $3.50 billion in the quarter, and missed estimates of $4.55 billion, according to Refinitiv data.

On an adjusted basis, the company earned 24 cents per share, in line with estimates.

Reporting by Tanay Dhumal in Bengaluru; Editing by Vinay Dwivedi and Shounak Dasgupta
Our Standards: The Thomson Reuters Trust Principles.

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September Brent futures climbed 6 cents, or 0.1%, at $79.52 a barrel by 0645 GMT, while August U.S. West Texas Intermediate (WTI) crude gained 5 cents, or 0.1%, to $75.40 a barrel.

The August WTI contract expires on Thursday. September WTI crude was higher by 6 cents, or 0.1%, to $75.35.

“Following some heavy selling pressure overnight, there is an attempt for oil prices to stabilise this morning,” said Yeap Jun Rong, market strategist at IG.

Prices fell in the previous session as investors took profits after data showed U.S. inventories fell less than analysts expected.

Meanwhile, the U.S. dollar (.DXY) was largely unchanged at 0645 GMT, edging down 0.1%.

The outlook for demand in China, the world’s biggest crude buyer, was also unclear amid its slowing economy.

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