LNG

Tellurian Inc., the developer of the Driftwood LNG plant in Louisiana, said it ended 2021 with more than $300 million in liquidity and over $360M in standardized measure of discounted future net cash flows of proved natural gas reserves.

Tellurian said in its earnings report that it continued advancing the Driftwood LNG project in 2021 with several listed accomplishments, including sales and purchase agreements (SPAs) totaling nine million tonnes per annum of LNG output.

The Driftwood plant in Calcasieu Parish in Louisiana, near Lake Charles, has permits to produce 27.6 MTPA of LNG and the 10-year offtake agreements are with Shell North America and global commodities firms Vitol and Gunvor.

Tellurian said it ended its 2021 fiscal year with a strong balance sheet consisting of around $621.8M in total assets.

The company generated about $71.3M in revenues from natural gas and LNG sales and reported a net loss of around $114.7M, or $0.28 per share (basic and diluted), for all of 2021.

The Tellurian project involves constructing 20 mid-scale processing Trains, each with 1.38MTPA of capacity, and built as five blocks of four Trains to reach the maximum planned capacity.

First phase

The Phase One development would include the first two of these blocks with 11 MTPA of output and two of three planned 235,000 cubic metres storage tanks and the first of three planned loading berths for LNG carriers.

Tellurian noted in its earnings that it had executed a long-term ground lease agreement with the Lake Charles Harbor and Terminal district and paid some debts to strengthened the balance sheet.

“The global economy is in the early stages of an energy super cycle driven by strong demand for natural gas and several years of underinvestment in energy infrastructure,” said Tellurian President and Chief Executive Octávio Simões.

“Tellurian is optimally positioned with fully executed market-based LNG SPAs and a permitted project,” added Simões.

The CEO confirmed a statement made in early February 2022 by Tellurian Executive Chairman Charif Souki that US engineering firm Bechtel would begin construction of Driftwood LNG in April and the company would seek to conclude the financing process shortly thereafter.

Shale-gas wells

Tellurian added in the report that it had drilled and put into production four new Haynesville Shale operated natural gas wells, increasing proved developed reserves by around 51 billion cubic feet (Bcf) as of the end of December 2021.

“Tellurian will continue our natural gas development program and expects to drill, complete and place into production additional operated Haynesville wells during 2022,” stated Simões.

The Haynesville gas resources produced 14.3 Bcf of natural gas for the year to the end of December and existing natural gas assets include 11,060 net acres, interests in 78 producing wells and estimated proved reserves of 323.3 Bcf.

“The reserve estimates were determined under US Securities and Exchange Commission guidelines and were prepared by an independent petroleum consulting firm,” said the company.

Vitol, the global commodities company, has set up a joint venture with the National Hydrocarbons Company of Mozambique (ENH) to market liquefied natural gas from the stakes held by the Mozambicans in the various LNG projects under development in the country.