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This year looks to be the best ever for liquefied natural gas (LNG) terminal stocks.
LNG terminal stocks refer to the companies building facilities to export LNG from the United States to areas where natural gas prices three or four times higher – like Asia.
This massive new LNG industry comes from the United States' abundance of natural gas resources. It has triggered a race among energy companies to turn former import terminals into export facilities.
In fact, Money Morning Global Energy Strategist Dr. Kent Moors calls the coming increase in LNG traffic is the "single most decisive change in worldwide energy transfers this decade."
LNG Terminal Stocks in 2014
LNG stock news in 2013 highlighted how this price difference is encouraging companies to partner in exporting deals.
And after a standstill of several years, the Obama administration is moving ahead with LNG project approvals – which means more LNG terminal stocks will soar in 2014.
Prior to 2013, only one company – Cheniere Energy Inc. (NYSEMKT: LNG) – had been granted approval to export LNG to countries without a free trade agreement with the United States. Its well-advanced Sabine Pass, La. facility may be exporting some LNG by the end of 2015.
That is one project out of a total proposed 27 LNG facilities that have applied to the U.S. Department of Energy for a green light.
To date in 2013, another three LNG projects have been given the okay to proceed from the Obama Administration.
These other projects receiving government approval are: Cove Point, Md. – owned by Dominion Resources (NYSE: D); Lake Charles, La. – controlled by BG Group PLC (BRGYY) and Energy Transfer Partners (NYSE: ETP); and Freeport LNG in Freeport, Texas – a partnership between Michael S. Smith and ConocoPhillips (NYSE: COP).
The key to success for these projects and others waiting in the government's queue will be the ability to get customers to sign long-term LNG contracts…