UK markets open in 1 hour 42 minutes

Coronavirus outbreak slows Energy Transfer's LNG push in China -CEO

FILE PHOTO: The logo of Royal Dutch Shell is seen at a petrol station in Sint-Pieters-Leeuw

(Reuters) - Fears about China's fast-spreading coronavirus outbreak are hampering Energy Transfer LP's <ET.N> efforts to lock in contracts with Chinese customers to deliver liquefied natural gas from the U.S. Gulf, the company's chief executive said at a conference on Wednesday.

Energy Transfer has brought U.S.-based employees back from its Beijing office, CEO Kelcy Warren said at the Argus Americas Crude Summit in Houston.

The company and Royal Dutch Shell <RDSa.L> have an agreement to develop Energy Transfer's existing Lake Charles LNG import facility on the U.S. Gulf Coast for LNG export, but the project has not received final investment approvals.

China was "very key" to the success of the project, and Energy Transfer was close to reaching contract agreements with "several Chinese customers" now that U.S.-China trade tensions have eased, Warren said.

"But I can't in good conscience let our people go over there at this time," he added, explaining how the company's work on the ground in China had been disrupted by the new coronavirus.

"We have a Beijing office and it's essentially unoccupied at this point because we brought everybody home."

The United States is on track to become the biggest global LNG exporter by 2024.

"The market is pretty glutted right now with LNG," Warren said, adding that the company was "giving it all we've got," to get the Lake Charles project done.

LNG is seen as an alternative for Asian countries that have relied on coal-fired power plants. LNG exports have surged in recent years out of Qatar and Australia, as well as the United States. The trio of countries are the world's biggest exporters of the super-cooled fuel.

China pledged this month to buy an additional $18.5 billion in U.S. energy products this year, but the Phase 1 deal of the U.S.-China trade agreement left tariffs in place for now, including a 25% levy on LNG imports.


(Reporting by Jennifer Hiller; Editing by Chizu Nomiyama and Tom Brown)