A proposed 8 billion ton per year FLNG project to be built by Excelerate Energy was shelved Tuesday due to flagging oil prices.
Regulatory documents seen by Reuters show that Excelerate will put its $2.5 billion export plant in Lavaca Bay, Texas on hold until April 2015.
Excelerate told the U.S. Federal Energy Regulatory Commission that oil price uncertainty forced it to undertake a “strategic reconsideration of the economic value of the project”.
In the filing, the Texas based company also suggested that low demand for capacity played a role in the suspension.
The company will update FERC on its plans for the project in April.
Excelerate reportedly told regulators that “due to the recent global market conditions, the company has determined that, at this time, this project no longer meets the financial criteria necessary in order for us to move forward with the capital investment.”
The company has not officially commented on the suspension.
The facility was set to be the first floating LNG solution in the U.S. Gulf of Mexico and was slated to begin exports in 2018.