Update to Lake Charles natural gas liquefaction project

Source:Energy Transfer Partners, L.P.

Energy Transfer and BG Group have agreed on preliminary terms to jointly develop an LNG liquefaction project at the facility. Lake Charles Exports, LLC (“LCE”), a jointly-owned subsidiary of BG Group plc (“BG Group”) and Southern Union Company (“SUG”), a joint venture owned by Energy Transfer Equity, L.P. (NYSE: ETE) and Energy Transfer Partners, L.P. (NYSE: ETP) (collectively, “Energy Transfer”), has received an order from the Department of Energy conditionally granting authorization to export liquefied natural gas to non-free trade agreement nations from the existing LNG import terminal owned by Trunkline LNG Company, LLC (a wholly-owned subsidiary of Energy Transfer) which is located in Lake Charles, Louisiana. LCE previously received approval to export LNG from the facility to FTA countries on July 22, 2011.

Energy Transfer and BG Group, through their respective subsidiaries Trunkline LNG Export, LLC, Trunkline LNG Company, LLC and BG LNG Services, LLC, have agreed on preliminary terms to jointly develop an LNG liquefaction project at the facility.

The potential project will entail the construction of three liquefaction trains with a total capacity of 15 million metric tonnes of LNG per annum and utilize the existing LNG storage and marine berthing facilities.

BG Group will have exclusive rights to the full export capacity (with renewal rights) on a tolling basis and oversee the design and construction management of the potential project. Additionally, BG Group will continue to retain contractual rights for import capacity of the facility throughout the term of the potential project.

Further, to facilitate BG Group’s sourcing of natural gas for the potential project, Trunkline Gas Company, LLC (also a wholly-owned subsidiary of Energy Transfer) will provide BG Group with pipeline transportation for the potential project’s upstream natural gas requirements.

The Front End Engineering & Design Study for the potential project has been awarded. SUG has been participating in the Federal Energy Regulatory Commission’s mandatory pre-filing process and expects to file a formal application for Section 3 authorization under the Natural Gas Act in or before the first quarter of 2014.

Pending final investment decisions from both Energy Transfer and BG Group, Energy Transfer will complete financing for the potential project and begin construction in mid-2015, with an anticipated project in-service date in mid-2019.

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