Entergy Corp. Withdraws from TransGas Pipeline Project Amid Changing Market Conditions

The U.S. energy company, Entergy Corp., has decided to withdraw from the TransGas consortium project, which aimed to build a 500-mile natural gas pipeline from Argentina to Chile. This move comes on the heels of Entergy's decision to scrap plans for two 350 megawatt power plants in Santiago, Chile, on which it had yet to start work. The project's terms, under which Entergy was to take 99 MMcfd of gas, were deemed unsatisfactory, allowing the company to pull out of the arrangement.

Key Takeaways:

• Entergy Corp. has withdrawn from the TransGas consortium project to build a natural gas pipeline from Argentina to Chile.
• The withdrawal was made possible due to Entergy's agreement with the consortium, which allowed it to pull out if the terms were deemed unsatisfactory.
• Entergy had planned to build two 350 megawatt power plants near Santiago, Chile, but has since scrapped those plans.
• The TransGas consortium will press on with the project, despite Entergy's departure, with two other companies, Southern Electric and Intergen, set to take gas from the pipeline to supply their own power plants.
• The Chilean government has approved a concession for TransGas to build its gas pipeline and for GasAndes, a rival consortium, to build a gas pipeline between Argentina and Chile.
• Industry analysts express doubts about the viability of two pipelines in the small Chilean market.

Statistics:

• The pipeline project is expected to cost $690 million.
• The pipeline will be 500 miles long.
• Entergy Corp. was to take 99 MMcfd of gas from the pipeline.
• Two other companies, Southern Electric and Intergen, will take gas from the pipeline to supply their own power plants.

Sources:

• Univision Noticias
• Reuters