Exxon Mobil Corp. and QatarEnergy delayed the start of a $10 billion natural gas export project in Texas to the end of next year after lead contractor Zachry Holdings Inc. declared bankruptcy.
The companies agreed other contractors could finish work on Golden Pass last month, paving the way for a restart after several setbacks this year. The new schedule means the 18 million-metric-ton-a-year facility, one of the country’s biggest, will begin operations about six months later than the previous plan, Exxon Chief Financial Officer Kathy Mikells said during an interview.
Read More: LNG Builder Zachry Cuts Thousands of Jobs at Exxon’s Golden Pass
Last month a Houston judge cleared a deadlock between the Exxon-QatarEnergy joint venture and Zachry after work at the site came to an impasse as thousands of workers were laid off. Zachry cited cost overruns stemming from the pandemic, along with soil conditions and supply-chain snags. It filed for Chapter 11 bankruptcy in May.
“We’re pleased the Golden Pass JV has reached a settlement with Zachary which enables us to continue working toward completion,” Mikells said.
The facility will come online in stages and is expected to supply customers in Europe and Asia. Other contractors on the project include McDermott International Inc. and Chiyoda International Corp.
QatarEnergy owns 70% of Golden Pass and Exxon owns 30%.
Copyright 2024 Bloomberg.
Topics Contractors
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