The LNG projects are being developed around the world to fulfill the ever increasing demand from Asia Pacific nations including Malaysia and Indonesia, as well as Australia.
In the U.S., the shale gas boom has created an excess supply of LNG, which has dragged down prices. As a result, the exploration and production companies turned towards international markets where LNG commands a higher price. This led to an increase in demand for construction of LNG export facilities, which bodes well for CB&I.
Meanwhile, the Obama administration has been busy giving approvals to LNG export projects. A new LNG export project by Veresen (VSN) has recently received the green light from the U.S. government. The leading U.S. oil majors, including Exxon Mobil (XOM) and Chevron, are also tapping into this demand by investing in these projects.
CB&I is bidding for several major projects that could be awarded through 2015. These include the $10 billion Golden Pass LNG project by Exxon Mobil and Qatar Petroleum, the $15 billion Mozambique LNG project by Anadarko Petroleum (APC) and the $15 billion Russian Far East LNG project by Exxon Mobil and Rosneft.
At the time of publication, the author held no positions in any of the stocks mentioned.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.