NEW YORK, Feb 11 (Reuters) - BP has signed an agreement to export natural gas overseas from the United States, becoming the latest energy giant seeking to profit from a huge rise in domestic production which has pushed prices far below global levels.
The London-based oil and gas producer has signed a 20 year deal with Freeport LNG, a company which is planning to build an export plant in Texas that will cool U.S. natural gas to a liquid for shipping to needy markets in Europe and Asia, Freeport said in a statement on Monday.
Pending approval from regulators, Freeport hopes to start construction on the plant by the end of this year, with completion expected four years later, it said.
Under the agreement, BP will be able to use the plant and export up to 4.4 million tonnes per year of liquefied natural gas (LNG) per year - the equivalent of the capacity of the plant's second production unit, called a train.
The capacity for the first train has already been sold to Japanese utilities Osaka Gas and Chubu Electric Power.
'With the first two liquefaction trains of the project fully contracted, we intend to approach the financing markets imminently so that we can begin construction on the initial two-train facility,' said Freeport LNG Chief Executive Michael Smith.
The export plant will be built on the site of Freeport's existing import terminal which has sat largely idle over the past few years as a rise in domestic output evaporated import needs.
A string of U.S. export plans have emerged over the past two years as companies aim to make the most of difference between low U.S. gas prices and high prices in markets such as Asia where LNG is at least four times dearer.
However, so far only one project has approval to export LNG - Cheniere Energy's Sabine Pass project in Louisiana - and the U.S. government is taking a cautious approach amid concerns that shipping gas abroad will push prices higher at home.
(Reporting By Edward McAllister; editing by Andrew Hay) Keywords: LNG FREEPORT/BP
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