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LNG Infrastructure Progressing on Multiple Fronts

Train 2 of the Gladstone LNG project on Curtis Island in Australia has begun producing liquefied natural gas (LNG), contractor Bechtel said Wednesday. Meanwhile, work at Cheniere Energy's Sabine Pass Terminal in Louisiana is advancing. And a widened Panama Canal is expected to see transit of larger vessels beginning next month.

Santos, operator of Gladstone LNG, said the project's first train sent out its first cargo, bound for South Korea, last October. At the time, the company said production from the second train would begin during the second quarter this year. Santos, Malaysia's Petronas and France's Total are partners in the project.

"Successfully delivering LNG production units for our three customers on Curtis Island will go down among the most significant achievements in Bechtel's 118-year history," said Alasdair Cathcart, general manager of Bechtel's LNG business. "Our teams have worked with the customers to overcome considerable challenges of megaproject construction, building the Curtis Island projects safely, on time and budget with the three facilities already producing above required capacity..."

In the United States, Train 1 of Cheniere's Sabine Pass terminal continues export operations while work on Train 2 advances. In a note Thursday, Genscape Inc. said the Valencia Knutsen, a 3.68 Bcf capacity vessel, arrived at Sabine early Wednesday morning to load a cargo. "With this cargo being loaded, Train 1 can continue to liquefy," Genscape said. "Had this cargo not been lifted, the 17 Bcf of LNG storage would have been full based off Genscape's revised Sabine LNG storage number."

In an update filed at the Federal Energy Regulatory Commission on Tuesday, Cheniere said, "Overall progress supports the achievement of substantial completion for Trains 1 and 2 by late May 2016 and September 2016, respectively. Trains 3 and 4 targeted substantial completion dates are April 2017 and August 2017, respectively..."

And the widening of the Panama Canal is coming to fruition as well. A third set of locks and deeper channels will allow the canal to accommodate a majority of the world's LNG tankers, providing shorter transit times and lower costs for cargoes moving between the Atlantic and Pacific oceans (see Daily GPIJan. 9, 2015).

Last month, the canal began taking transit reservations for Neopanamax vessels for passage through the canal beginning June 27. During the first period of transit reservations, 25 Neopanamax vessels reserved transit through the canal's new locks, according to the canal's operator. "This initial phase of transit reservations corresponds to transit dates between June 27, 2016 and Sept. 30, 2016," the operator said.

The first reservation was granted to liquefied petroleum gas tanker Linden Pride of Nippon Yusen Kaisha Line.

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