LNG

McDermott International, the company involved in some of the world’s leading LNG construction projects, including several on the US Gulf Coast and the North Field Expansion in Qatar, said it had been formally notified by the New York Stock Exchange that it was not meeting price requirements for future listing.

The Sempra Energy-led Cameron LNG export project in Hackberry Louisiana has formally asked the federal Energy Regulator for permission to begin the facility's first shipments of commissioning cargoes to free trade agreement countries and non-FTA states as authorized by the Department of Energy.

“Commissioning activities are progressing well for Train 1 and Cameron LNG anticipates exporting LNG produced during commissioning according to the schedule provided,” the Cameron project told the FERC.

“To meet the schedule provided, Cameron LNG is requesting authorization for the commissioning cargoes on or before May 16, 2019,” said the Sempra joint venture.

“With the first production of LNG from Train 1, Cameron LNG will file weekly commissioning reports as requested by the Commission,” the company added.

Sempra, the San Diego, California-based utility has also said it expected to begin posting earnings from the first processing Train by mid-2019.

Sempra has also increased its projected share of full run-rate earnings from the first three Trains at Cameron to be between $400 million and $450M annually, up from the previous projection of $365M to $425M.

The Cameron project’s first phase includes three Trains with export capability of almost 15 million tonnes per annum.

At least two of the three Trains are expected to be producing LNG by the end of 2019.

The Cameron project is jointly owned by Sempra, French major Total, Japanese trading house Mitsui & Co and Japan LNG Investment, a venture owned by Japan’s Mitsubishi Corp. and the shipping company Nippon Yusen Kabushiki Kaisha, known as NYK Line.

When Cameron ships its first cargo it will be the fourth US LNG export plant to begin commercial operations after Cheniere Energy’s Sabine Pass and Corpus Christi plants and Dominion Energy’s Cove Point facility.

Sempra has a strategy to achieve around 45 MTPA of LNG production by the mid-2020s through three plants it is developing, the Cameron facility, Port Arthur LNG in Texas and the Costa Azul terminal on the Pacific Coast of Mexico.

Kinder Morgan, the US pipeline and infrastructure company, has encountered minor issues relating to the commissioning of equipment at the facility near Savannah in the state of Georgia vying to enter the start-up phase ahead of the Cameron LNG plant in Louisiana.

Elba Island is an existing import terminal that has been transformed into an export plant to produce an initial 2.5 million tonnes per annum of LNG from 10 small liquefaction Trains.

Kinder had previously expected the first liquefaction Train to come on stream in April and the remaining Trains following in sequence.

However, the project has been hit by minor construction delays. The start-up had previously been expected by the end of 2018.

According to the Federal Energy Regulatory Commission, the mini liquefaction Trains 1-6 at Elba Island are expected to start entering service at one-month intervals.

Elba Island’s Trains 7-10 are then scheduled to come on stream in the third quarter of 2019.

The 10 units being installed at Elba mark the first time this specific technology is being deployed in the US.

The Elba plant is using Royal Dutch Shell’s Movable Modular Liquefaction System. These small-scale liquefaction Trains are mostly pre-assembled then brought to the site.

“Since this is the first project using this specific configuration of liquefaction technology, we have experienced some minor issues that are being resolved as part of the process,” said Kinder.

The Georgia project is supported by a 20-year supply contract with Shell and is the smallest of the three US plants being completed in 2019. Shell was a stakeholder in the Elba Island plant when it operated as an import terminal.

Start-ups for Elba Island, Sempra Energy’s Cameron LNG in Louisiana and the Freeport plant in Texas will double the number of US LNG export terminals in operation.

The Cameron facility is also set for production, ahead of Freeport, though both have suffered various holds ups and problems in construction.

Kinder and several equity fund partners are also developing the Gulf LNG export project proposed at the site of the existing import terminal at Pascagoula in Mississippi.

Mitsubishi Corp. of Japan is planning to refinance the Japanese energy and LNG engineering company Chiyoda Corp. with a capital injection of at least $1.4 billion to help it recover from project setbacks and to secure some of the liquefaction plant work in a new wave of forthcoming contracts.