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Liquefied-gas project nearly export-ready

by ANNA SHIRYAEVSKAYA and NAUREEN S. MALIK BLOOMBERG NEWS | September 27, 2015 at 3:12 a.m.

Cheniere Energy Inc. plans to start liquefied natural gas production this December at its Sabine Pass terminal in Louisiana, according to Helena Wisden, a senior trading manager at Cheniere.

That will pave the way for the first cargo to be loaded for export onto a seagoing tanker, she said last week at the LNG Global Congress in London.

"We should have exports starting in 2015, but I think we will see how that comes together in the final few months of construction," Wisden said.

Houston-based Cheniere previously planned to ship its first cargo from the western Louisiana facility in December, making it the first of a wave of projects forecast to turn the nation into a net exporter of gas by 2017, according to the U.S. Department of Energy.

In all, Sabine Pass will have six plants, also called trains, with total liquefaction capacity of 3.5 billion cubic feet a day.

Construction on the first two trains began in August 2012, and they were 92 percent complete at the end of June, "ahead of the contractual schedule, Cheniere said in its second-quarter earnings release in July. "Based on our current construction schedule, we anticipate that Train 1 will produce LNG as early as late 2015."

Sabine Pass was planned and approved for exports as the shale boom flooded the U.S. with natural gas, causing prices to slump to a decade low in 2012 and making it an attractive source for Asian and European buyers who were buying more expensive LNG that was linked to oil.

However, the shale oil boom in the lower 48 states that is contributing to a global glut is now making it harder for U.S. gas to compete on the high seas as Australian exports climb. West Texas Intermediate crude prices have slumped more than 50 percent in the past year.

Cheniere has sold almost 80 percent of the 27 million tons of liquefaction capacity for the six plants through long- term agreements and "the rest will stay in the short-term market," Chief Executive Officer Charif Souki said at the Enercom Inc. Oil & Gas Conference on Aug. 19.

Christine Buurma with Bloomberg News contributed to this report.

SundayMonday Business on 09/27/2015

Print Headline: Liquefied-gas project nearly export-ready


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