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ConocoPhillips to Divest Kenai LNG Export Terminal in Alaska

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ConocoPhillips (COP - Free Report) is looking to divest its Kenai liquefied natural gas (“LNG”) export terminal in Alaska.

Kenai has been the only LNG export terminal in North America for nearly five decades now. The majority of the LNG generated at the plant is sold to Japan.

ConocoPhillips cited the current market conditions as the reason for the divestiture plans. The company also mentioned its intention of focusing on the North Slope operations as it has recently explored new ground on the western edge of the state’s North Slope oil fields. This provided the company access into federal territory in the National Petroleum Reserve –Alaska.

The company’s efforts are in line with its strategy to regularly appraise assets and optimize their value for shareholders.

Earlier this year, ConocoPhillips sold its stake in the Beluga River Gas field in Cook Inlet in South-central Alaska for $152 million to the municipality of Anchorage and Chugach Electric Association.

The LNG plant in Nikiski on the Kenai Peninsula was brought online in 1969. The plant is believed to be a strategic asset which can offer ample opportunities for the right buyer.

In 2015, the Kenai LNG plant was operational for only six months and it liquefied 20 billion cubic feet of gas for delivery. However, this year, it has not exported any gas so far owing to the prevailing market conditions. But the plant, which currently employs about 23 people, is operational and ready to continue exports.

Earlier in 2016, Cheniere Energy, Inc. (LNG) became the second U.S. exporter of LNG from its facility in Sabine Pass, LA.

ConocoPhillips currently has a Zacks Rank #3 (Hold). Some better-ranked players in the same sector include SunCoke Energy Inc. (SXC - Free Report) , Suncor Energy, Inc. (SU - Free Report) and TransCanada Corporation (TRP - Free Report) . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

SunCoke Energy posted a positive earnings surprise of 177.78% in the last reported quarter. It reported a positive earnings surprise in three of the four preceding quarters.

Suncor Energy posted a positive earnings surprise of 300.00% in the preceding quarter. It reported an average earnings surprise of 40.55% for the four preceding quarters.

TransCanada posted a positive earnings surprise of 22.92% in the last reported quarter.

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