A natural gas liquids production facility is undergoing a $1 billion investment to replace its aging equipment.
Natural Gas Equipment LLC, a subsidiary of ConocoPhillips, said Friday it will purchase equipment from Texas-based Texas-Pacific LNG and purchase gas tanks from Texas Southern LP for $1,260 per tank, a cost that will be paid for by the company.
The company said the $1-billion investment will allow it to complete a two-year project to replace more than 200 million gallons of liquid natural gas storage tank storage that has been sitting in storage at its facilities in Houston, Texas, and Dallas, Texas.
The tanks were originally built in the 1960s, according to the company, and have been used to store compressed natural gas for over two decades.
They were upgraded in the 1990s to be used for natural gas liquified products, and then in the 2000s to use for the liquefied natural gas that is now being used in natural gas pipelines.
Natural gas liquids have a high melting point, and the tanks are also susceptible to being damaged during storage and transport.
In addition, the liquids are volatile and can leak and explode.
The announcement came after a federal court last month approved the loan agreement.
The loan will pay for equipment to replace the older tanks, as well as other upgrades to the facility, which is also known as the Super LNG facility.
The plant, which was built in 2008, is owned by Conoco-Phillips and the federal government.
The Super LNGL facility was designed to store up to 1 million barrels of liquid gas and is expected to generate up to $200 billion in revenue annually.
The U.S. Environmental Protection Agency estimates the facility would produce up to 3.5 billion cubic feet of natural gas annually.