LNG producer Venture Global raises Plaquemines project cost forecast by $2 billion

Venture Global announced on Thursday that it expects its Plaquemines LNG Plant in Louisiana project costs to be about $2 billion more than its previous estimate due to inflation and various other factors.

In premarket trading, shares of the company dropped 19.2% to $11.50.

The LNG producer now expects that the plant will cost between $23.3 and $23.8 billion. Previously, it was expected to be in a price range of $21 to $22 billion. The company paid $19.8 billion as of December 31.

Venture Global warned that costs for the completion of the project could increase. The company said it had not taken into account recent tariffs imposed by the Trump administration. These are expected to increase the cost of setting up these plants.

Last month, U.S. Federal regulators granted the company permission for the Plaquemines Plant to increase its export capacity to 27.2 metric tons annually from 24 mtpa.

Venture Global, one of the U.S.'s most valuable LNG companies, reported a 6.6% drop in revenue for the fourth quarter to $1.52 Billion, due in part to a 13% decline in LNG sales.

It posted a profit of $871m, as opposed to a loss $50m a year earlier, due to lower costs.

Venture Global said it would also begin the final investment decision process for a second LNG facility with a capacity of liquefaction of 20 mtpa, at its Calcasieu Pass site in Louisiana. As of December 31, it had already invested $4 billion in the project.

Calcasieu Pass is already home to a LNG export facility that will export 10 mtpa at minimum once completed.

Venture Global has been in dispute with BP, Shell, and Edison for non-receipts of cargoes as a result of a lengthy testing and optimization process. (Reporting and editing by Leroy Leo in Bengaluru, Tanay Dhumal from Bengaluru)

(source: Reuters)