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The Total SA company sign is seen outside their headquarters in the La Defense business district in Paris, France, on Monday, April 2, 2012. Total bought a 23-per-cent stake in the Driftwood liquefied natural gas project being developed by Tellurian Investments Inc., they said in a joint statement.Balint Porneczi/Bloomberg

Charif Souki, the ousted chief executive officer of Cheniere Energy Inc., won backing on Tuesday from French energy company Total SA for a gas-export terminal in Louisiana that will ultimately compete with the company he once led.

Total bought a 23-per-cent stake in the Driftwood liquefied natural gas project being developed by Mr. Souki's latest company, Tellurian Investments Inc., they said in a joint statement Tuesday. The deal was valued at $207-million (U.S.). Mr. Souki established Tellurian earlier this year after clashing with Cheniere's board over strategy and losing his job there. Construction on Driftwood is scheduled to begin in 2018 with production starting in 2022.

Total's investment adds to the growing optimism that gas demand will surpass a worldwide glut of LNG supplies in the coming years and spur more demand for export terminals. A rebound in crude prices has also made LNG a more attractive fuel to burn at power plants and has deepened the discount for U.S. shale gas compared with supplies elsewhere.

Tellurian has "a strong track record of developing and managing LNG assets in the U.S.," Philippe Sauquet, head of Total's gas, renewables and power business, said Tuesday. "Investing in Tellurian at an early stage will give us the opportunity to potentially strengthen our mid– and long-term LNG portfolio."

The announcement comes three months after the project developer filed an application with the Energy Department to export gas and less than a year after Cheniere sent the first cargo of U.S. shale gas overseas from a terminal nearby.

The scale of the Driftwood project is modest compared with the behemoth plants Cheniere's building in Louisiana and Texas. Total's investment is "a sign that a technological shift is under way – the majors are going big on small-scale LNG," Giles Farrer, global LNG research director at consultancy Wood Mackenzie Ltd., said by e-mail.

"For Tellurian, with no project under development, it's a big endorsement and shows that their leadership can do the deals to meet its ambitions," he said.

The Driftwood project is still in the design and pre-filing phase, Total and Houston-based Tellurian said in their statement. They didn't disclose marketing plans for the LNG or whether Total will hold capacity or have an off-take agreement for the terminal.

Total's plan is to double its gas liquefaction capacity from 2015 to 2020 to about 20 million tons a year, according to the statement.

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