LNG

Saudi Arabian Oil Company (Aramco), which recently signed two US LNG accords in Texas, has awarded contracts worth $25 billion to boost its own strategic natural gas production in the Middle East Kingdom.

The US Department of Energy has published its latest LNG monthly export data showing the Netherlands, South Korea, France, Spain and the UK receiving the most cargoes and the most expensive shipments departing from a Louisiana plant at the highest price from the export point so far in 2022.

German LNG Terminal GmbH, the development company of the onshore import facility at Brunsbüttel on the Elbe River south of the port of Hamburg and adjacent to the Kiel Canal, has signed up three leading energy companies as long-term foundation customers for regasification capacity.

One of the most respected meteorologist groups in the United States has forecast a more active US Gulf Coast hurricane season in 2022 that would lead to the temporary shutting of oil and gas production and LNG export facilities.

Commonwealth LNG, the export venture proposed for Cameron Parish in the US Gulf Coast state of Louisiana, has overhauled its management and named the former Chief Executive of Sempra’s Cameron LNG project, Farhad Ahrabi, to serve as Commonwealth’s new President and CEO.

Ahrabi joins Commonwealth following a seven-year tenure at Cameron during which he oversaw the development, construction and subsequent operations of a 14.5-million tonnes per annum liquefaction and export facility at Hackberry in Louisiana.

Commonwealth’s plan is for an export plant consisting of six liquefaction Trains, each with a nominal production capacity of 1.4 MTPA and totalling 8.4 MTPA.

The project is also proposing to construct six LNG storage tanks, each with capacity of 50,000 cubic metres and one marine berth capable of accommodating vessels of up to 216,000 cubic metres capacity.

The liquefaction plant requires about 182 acres to construct and would occupy about 107 acres during operations.

The Commonwealth project’s founder and Chairman, Paul Varello, said he was delighted to recruit Ahrabi to head the team.

Leadership

“The depth of Farhad’s leadership experience, both at Cameron and the preceding 28 years with BG Group, will be of immeasurable value to our team as we move through the final stages of development and into construction and operation,” said Varello.

“Projects of this magnitude involve a complex convergence of technical, financial, political and community support elements that require the kind of high-level thinking and pragmatic solutions that Farhad can bring,” Varello added.

Ahrabi said he was particularly attracted to the Commonwealth opportunity because of the company’s engineering-focused approach.

The new CEO said that Commonwealth’s advantage is that it will keep liquefaction costs low and ultra-competitive in the global market at a time when there is a growing demand for US-sourced gas.

“Commonwealth has staked its ground by securing an excellent location, developing a highly modularized approach to provide clean and affordable energy, and offering creative and flexible commercial terms,” said Farhad.

“I’m humbled and excited to have the opportunity to lead the organization in delivering its promise in a way that not only serves the interests of this company, its employees, the local communities and all other stakeholders, but is part of the overall advancement of the next generation US LNG facilities,” he stated.

BG veteran

In addition to his prior roles at Cameron LNG and BG Group of the UK, Ahrabi has also served over the past two years as an Independent Director at ARC Resources Ltd, a leading Canadian energy company with a diverse asset portfolio focused on responsible energy development.

Ahrabi holds a PhD in Reservoir Engineering from the University of Exeter (England) and a Bachelor of Science degree in Chemical Engineering from the University of Wales.

Commonwealth said its remaining pre-final investment decision activities were underway for a projected start of construction in 2023.

The project is expected to have an accelerated schedule that will allow building to be completed in three years using a predominantly modular approach for a projected start of commercial operations in 2026.

French major TotalEnergies and North American US LNG plant owner and developer Sempra are expanding their strategic alliance with the signing of an accord covering the Vista Pacífico LNG export project in Mexico.

The Vista Pacífico LNG project is planned to be a mid-scale facility on Mexico’s West Coast with cargoes pointing at the high-demand markets such as Asia and South America.

California-based Sempra, the main owner and operator of the Cameron LNG plant in Louisiana, has already signed a non-binding agreement with Mexico’s state-owned utility company, the Comisión Federal de Electricidad, for the potential joint development of this project

Sempra said the accord signed with TotalEnergies was in the form of a memorandum of understanding (MoU) for the French oil and gas company to offtake one-third of future LNG production at Vista Pacífico LNG and to become a shareholder in the project with a minimum stake of 16.6 percent.

Sempra’s development of Vista Pacífico LNG is in addition to its Energía Costa Azul LNG export project, which is transforming an existing import terminal into an export plant.

TotalEnergies and Sempra are already partners in the Cameron LNG plant in Hackberry, Louisiana and in the Cosa Azul project.

Global player

TotalEnergies is already one of the world’s leading LNG export developers and traders with interests in liquefaction plants in Angola, Australia, Egypt, the United Arab Emirates, Nigeria, Norway, Oman, Russia and Qatar. It is also developing the Mozambique LNG project.

Mexico’s other LNG export plans also include the US Mexico-Pacific Ltd (MPL) LNG project.

The MPL company is based in Houston and has joined with LNG engineering firm Bechtel Inc. on developing a liquefaction and export facility on the Pacific Coast using US natural gas as the feed gas and processing technology from ConocoPhillips.

The MPL plant is proposed for near Puerto Libertad in the northwest state of Sonora and would have just over 14 million tonnes per annum of output.

Sempra’s LNG interests have been transferred into the Sempra Infrastructure entity under a corporate restructuring and one of its shareholders is the US investment fund Kohlberg Kravis Roberts, now known as just KKR.

A second MoU with Sempra and TotalEnergies provides for the co-development of several renewable energy projects in North America.

This could see Sempra’s acquisition of 30 percent of the TotalEnergies equity interest in a wind project off the coast of California that is preparing for an upcoming auction.

“We are pleased to further strengthen our partnership with Sempra in North America in LNG and to extend it to renewables,” said Patrick Pouyanné, Chairman and Chief Executive of TotalEnergie.

“Over the past years, TotalEnergies has become the leading exporter of US LNG and has built up a pipeline of 4 gigawatts of solar projects and 3 GW of offshore wind projects currently under development in the US,” added Pouyanné.

US energy executive Whitney “Whit” Fairbanks, who has previously managed the Peru LNG export plant for Hunt Oil, has been named President of Cameron LNG, the export plant at Hackberry in Louisiana developed by US utility Sempra Energy.

Sempra Infrastructure, the US company controlling Sempra LNG and its Cameron export plant at Hackberry in Louisiana and related assets in Mexico, has sold a 10 percent stake to the Abu Dhabi wealth fund in the United Arab Emirates.

TC Energy Corp. of Canada, the North American pipeline natural gas supplier including for two LNG export projects in British Columbia, said it intended to unlock a wealth of untapped demand in Mexico, where it already has major operations.

Sempra Energy has been communicating with the US Federal Energy Regulatory Commission to make sure certain final design enhancements for the already approved fourth liquefaction Train at the Cameron LNG plant in Louisiana will not be subject to any pre-filing processes.

Sempra said it had requested a determination from the Director of the Office of Energy Projects in November 2021 that the scope of the amendment would not be caught up in new regulatory hold-ups.

Cameron LNG has since provided additional information regarding the scope of the altered design.

The company emphasized that the prospective modifications to the previously-approved Train 4 project as proposed by the amendment will not “involve significant state and local safety considerations that have not been previously addressed”.

These include the addition of LNG storage tanks, increasing throughput requiring additional tanker arrivals or the use of larger vessels.

Sempra stated that the proposed design enhancements for Train 4 would not alter or impact the existing marine facilities and would not change Cameron LNG’s current Waterway Suitability Assessment (WSA).

Coast Guard

The company said it had engaged with the United States Coast Guard regarding the proposed amendment and the USCG had determined that Cameron LNG was not required to submit a new “Letter of Intent” or revision to its current WSA for the amendment.

While some parts of the design have been enhanced, others have been withdrawn.

Importantly, there is the removal of the construction of a fifth Train and associated utilities and condensate storage tanks permitted with the original expansion permit.

One of two boil-off gas compressors previously permitted would not be needed and the construction will be wholly within the footprint authorized by the FERC.

However, Sempra noted that the expansion amendment would include about a dozen other design enhancements and additions for Train 4.

Among them are the addition of a feed-gas booster compressor to increase feed-gas pressure to Train 4, a propane refrigeration package to cool the dehydration unit feed gas within Train 4 and the use of “open art technology” on the NGL extraction process in lieu of a proprietary process.