LNG

The US Department of Energy (DoE) has issued two long-term orders authorizing additional liquefied natural gas exports from two projects of the US Gulf Coast, the QatarEnergy-backed Golden Pass LNG plant in Texas and the Magnolia LNG venture in Louisiana owned by the Glenfarne Group.

Golden Pass, an existing import terminal currently being transformed into an export facility, is a joint venture between QatarEnergy and ExxonMobil Corp. and the first liquefaction Train is scheduled to come on stream by 2024.

The Federal Energy Regulatory Commission formally approved the transformation of Golden Pass, located on the Sabine-Neches Waterway in Texas, back in December 2016.

However, the Qatar-ExxonMobil project has advanced at a slow pace because of doubts several years ago over market demand issues that have now been resolved and work has gathered pace to construct three liquefaction Trains with around 16 million tonnes per annum of output.

US regulators had previously approved construction of the Magnolia LNG plant proposed for a 115-acre site near the Calcasieu Ship Channel with 8.8 MTPA of output from four Trains.

Investment buyer

The Magnolia development had previously been owned by an Australian-listed company LNG Ltd that ceased trading amid financial difficulties.

Glenfarne, a New York-based fund specialising in energy infrastructure investment, then took over the project.

The DoE orders have authorized additional 0.5 billion cubic feet per day (Bcf/d) of natural gas flows to the plants. “The orders allow Golden Pass LNG to export the equivalent of an additional 0.35 Bcf/d and Magnolia LNG to export an additional 0.15 Bcf/d of natural gas as LNG to any country not prohibited by US law or policy,” said the statement.

The DoE had previously issued long-term non-free trade agreement export orders for the majority of the projects’ capacities, with Magnolia LNG’s authorization for 1.08 billion cubic feet per day in 2016 and an authorization for 2.21 billion cubic feet per day issued to Golden Pass LNG in 2017.

The statement explained that the two orders align the respective export authorizations to additional capacity that the FERC had approved for the projects based on optimized project designs.

“The United States is the largest global producer of oil and natural gas and a net exporter of energy. US fuel supplies, including LNG, continue to play a key role in global energy security, particularly due to Putin’s invasion of Ukraine,” said the DoE.

It noted that US LNG exports had recently reached new highs of about 12 billion cubic feet per day and are expected to grow to more than 13 Bcf per day by the end of this year as additional export capacity comes online from seven large-scale plants now operating. 

Lake Charles LNG, the US export project being pursued by pipeline and midstream company Energy Transfer and Royal Dutch Shell, has issued a tender package for engineering, procurement, and construction and for contractors to submit firm bids.

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.

Sempra Energy, the developer of two US export projects and a third in Mexico, said it received authorizations from the US Department of Energy to export US-produced pipeline natural gas to Mexico and to re-export it as LNG to countries that do not have a free-trade agreement with the US.

The US Department of Energy has issued a long-term order authorizing the export of domestically produced liquefied natural gas by the Venture Global company, developer of two LNG export projects in Louisiana.