Tellurian contemplates scaling back Driftwood

(Courtesy Tellurian Inc.) An artist's rendering of the proposed Driftwood LNG

Tellurian Inc. is considering changes to its Driftwood LNG export project in Louisiana that could significantly reduce overall costs for the first phase, Reuters reports.

The company did not provide details on the cost cuts, but Scotiabank analysts tell Reuters the reduction could mean the potential removal of the Permian pipeline, for a possible savings of $4.2 billion.

Tellurian has said the Driftwood project, designed to produce 27.6 million tonnes per annum of LNG, is expected to cost $27.5 billion, including pipelines. About $15.4 billion of the estimate is for a contract with Bechtel Oil, Gas and Chemicals Inc to build the export plant.

The company also last week announced the sale of 35 million shares of common stock at a price of $1.00 per share for net cash proceeds of approximately $32.5 million.

Reuters has the full story.