Engineering and construction firm KBR Inc., which has a contract for the Magnolia LNG project in Louisiana, is dropping most of its liquefied natural gas construction and other energy projects.
Reuters reports the Houston company told investors and employees it is refocusing on government contracts and technology businesses, as customers pull back on energy investments.
Chief Executive Stuart Bradie wrote to employees last week that KBR will “no longer engage in lump sum, blue collar construction services,” saying the COVID-19 pandemic accelerated the decision to leave fixed-contract energy projects. KBR held contracts for engineering and construction services for several LNG projects.
The changes will mean “significant realignment in some offices, a smaller office footprint as we transform to the new structure and the new way of working, and the exiting of certain markets/geographies and offices,” the email said.
Glenfarne Group LLC, a New York developer, owner-operator and industrial manager of energy and infrastructure assets, now owns Magnolia LNG.
It acquired the LNG export terminal development project in Lake Charles through its newly formed subsidiary, Magnolia LNG Holdings LLC.
Magnolia LNG is an 8 million tonnes per year LNG export business that has completed the Federal Energy Regulatory Commission permitting process. The 115-acre project site sits on the Industrial Canal near Lake Charles in Southwest Louisiana, and has a long-term Lease Option Agreement in place with the Lake Charles Harbor and Terminal District.
Magnolia LNG is permitted to receive natural gas through the existing Kinder Morgan Louisiana Pipeline, and will pretreat, liquefy and store the LNG onsite for domestic use and export. The transaction also includes the acquisition of Magnolia LNG’s patented OSMR® liquefaction technology, a low-cost, highly efficient process configured to generate lower greenhouse gas emissions than other conventional LNG processes.
