NEW YORK (TheStreet) -- Dominion Resources (D) - Get Report  is working to sell more liquefied natural gas to foreign buyers as a way of expanding into the export business.

The Virginia-based power and energy company is competing against several U.S. companies that want to expand exports, including Cheniere Energy (LNG) - Get Report . So it's in Dominion's interest to increase exports by signing long-term agreements with buyers to use the LNG facility it's building in the Maryland even if those buyers later resell some or all of that product. Those foreign buyers include Japan's Tokyo Gas (TKGSY) and India's GAIL (GAILF) .

Dominion shares have gained 4.6% this year to $67.50 compared to a 0.7% advance for the S&P 500.

Last month, Dominion received final approval from U.S. regulators for the construction of its Cove Point terminal in Lusby, Maryland, which will be used to ship 5.25 million tons of LNG each year to other countries, particularly in Asia and Europe. Dominion intends to fund the $3.8 billion project through the initial public offering of the spinoff of Cove Point into a master limited partnership called Dominion Midstream Partners.

In an email to TheStreet, Karl Neddenien, Dominion's spokesperson, said that "construction activities have begun" and the company expects "the export facility to be operational in late 2017."

Cove Point is located near the Marcellus Shale, the home of the largest natural gas reserves in the U.S., stretching from New York to West Virginia. Cove Point is the first project to capitalize on the booming Marcellus gas production that rose to record levels of 15 billion cubic feet per day in July, up from just 2 billion cubic feet per day in 2010. Chris Turnure, analyst at JPMorgan, said in a research report emailed to TheStreet that Cove Point is one of Dominion's "major future growth drivers."

Tokyo Gas, which has committed to purchase 1.4 million tons of LNG each year from the Cove Point terminal, has put more than half of this capacity up for sale, because of a drop in demand. Similarly, GAIL has contracted to purchase LNG from Dominion as well as Cheniere Energy, offering some of Cheniere's LNG to buyers.

This drop in LNG demand is, in part, due to the weakness in oil prices, said Tim Winter, analyst at the financial services company Gabelli, in a phone interview with TheStreet.

However, it does not pose a threat to the future prospects of Dominion's LNG export project. On the contrary, this is "encouraging for the long-term future" because the Asian companies will likely resell the gas they bought at a higher price, which reflects "even greater demand for the product," Winter explained.

Dominion, on the other hand, believes the future of its LNG export project is secured by long-term agreements with buyers. "Dominion has fully subscribed the marketed capacity of the project with 20-year service agreements" with GAIL and Tokyo Gas, Neddenien said. "So global demands and volumes will not have an impact on Cove Point."

Cheniere Energy has also signed a 20-year agreement to ship LNG to GAIL. Cheniere's spokesperson said in an email to TheStreet that GAIL's decision shows the Indian natural gas company is becoming a stronger LNG portfolio buyer. This also shows that trading on future cargoes has already started, which is a positive sign since this will bring much needed liquidity to the LNG market, the spokesperson said.

At the time of publication, the author held no positions in any of the stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

TheStreet Ratings team rates DOMINION RESOURCES INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate DOMINION RESOURCES INC (D) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins, notable return on equity and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

You can view the full analysis from the report here: D Ratings Report