LNG

The cancellation of LNG cargoes from Gulf Coast export plants amid over-supply and a price collapse is set to be offset by an increase in pipeline exports to Mexico, the largest component of US natural gas trade and a key take-away portion of still high production levels.

Tellurian Chief Executive Meg Gentle said the Houston company is lean, resolved and focused on delivering the Driftwood LNG export project near Lake Charles in Louisiana.

Feb 13 (LNG) - Annova LNG, the small export project planned for the Port of Brownsville in south Texas, has received a 20-year permit from the Department of Energy to export cargoes to nations without a Free Trade Agreement with the US. The liquefaction plant will produce around 7 million tonnes per annum of LNG.

   “This authorization from the DoE allows us to reach more customers worldwide and is another milestone accomplished as we make progress towards a final investment decision,” said Omar Khayum, Chief Executive of Annova. 

The leading US liquefied natural gas industry body said it expected five export projects along the Gulf Coast to take positive final investment decisions in the next 12 months after just two were sanctioned so far in 2019 while American supplies could be directed at Europe in particular.

The American Gas Association has welcomed the balanced perspective taken in the draft guidance released by the White House Council on Environmental Quality in relation to the greenhouse-gas emissions of major energy, pipeline and liquefied natural gas projects.

The new draft guidance is aimed at helping to clarify how federal agencies should consider the greenhouse-gas impacts of major project permitting decisions when conducting environmental reviews under the US National Environmental Policy Act.

“The draft guidance from the White House Council on Environmental Quality will help facilitate the environmentally-responsible construction of natural gas pipelines and other infrastructure that our customers want and need,” said AGA President and Chief executive Karen Harbert.

“Streamlining and clarifying the permitting process helps the natural gas industry provide timely, safe, reliable and affordable service to the 178 million Americans who enjoy the benefits of natural gas and the millions more that want it, but do not yet have access,” added Harbert.

In particular, the draft guidance would help focus agency resources on evaluating the reasonably foreseeable greenhouse-gas impacts of agency permitting decisions, rather than “expending resources on evaluating remote or speculative matters” that do not have a sufficiently close causal relationship with an agency’s permitting decision.

The guidance directs agencies to consider greenhouse-gas emissions when “substantial enough to warrant quantification.”

Agencies do not have to consider how a project might impact greenhouse emissions if doing so would be “overly speculative.”

It reverses a 2016 rule from the same Council under the previous presidency that directed agencies to analyze how the projects they approve will contribute to climate change.

President Donald Trump withdrew the previous guidance in April 2017.

Environmental groups have said the proposal would reduce environmental protection.

The US Congress has been divided along party lines on the proposal, with Republicans praising the Trump Administration for removing hurdles for energy development as the nation embarks on boosting domestic natural gas use in power generation and LNG exports.

“This proposed guidance will help ensure that major energy projects in Wyoming and across the country can move forward without needless delays and litigation,” said John Barrasso, Republican Senator for Wyoming and head of the Environment and Public Works Committee.

The American Petroleum Institute also approved, saying it would “streamline” the National Environmental Policy Act (NEPA).

“NEPA, which is a procedural statute only, increasingly has been misused to delay and prevent development, which negatively affects jobs, tax revenue and investment in communities across the country,” said Howard Feldman, senior director of regulatory and scientific affairs for the American Petroleum Institute.

The US is in the midst of an LNG export build-out focused mostly on the Gulf Coast to earn billions of dollars for the American economy from the shale-gas glut by providing foreign countries with cleaner natural gas to replace coal.

At present four LNG export plants are on stream, Sabine Pass and Cameron LNG in Louisiana, Corpus Christi in Texas and Cove Point in Maryland.

The Elba Island LNG plant in Georgia and the Freeport facility in Texas are also scheduled for start-up to give the US six exporting plants. 

At least a dozen more liquefaction and export plants and feed-gas pipelines are making progress along the regulatory route.

The Panama Canal Authority said it expected LNG carrier traffic to increase by around 50 percent by the fourth quarter of 2018 as more US cargo export capacity comes on stream.

Cheniere Energy’s Sabine Pass LNG export plant in Louisiana sent out 15 cargoes and narrowed its monthly delivery count to seven different nations compared with nine previously and the majority went to South American and Latin American countries, according to the latest detailed data from the US Department of Energy.