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Freeport LNG Poised To Begin Fourth Liquefaction Train

Freeport LNG Development LP said it has filed an application with FERC seeking authorization to site, construct and operate a fourth liquefaction train at its liquefied natural gas (LNG) export facility near Freeport, TX, and has begun front-end engineering and design for the proposed Train 4.

"Following closely on the heels of our successful development of the initial three trains of the Freeport Liquefaction Project, Train 4 will position Freeport LNG to supply the next wave of U.S. Gulf Coast LNG," said Freeport LNG CEO Michael Smith.

Train 4 is being designed with a nominal production capacity of 5.1 million tonnes per annum (mtpa), the Houston-based company said. Freeport LNG anticipates being ready to begin construction of Train 4 by the end of 2018, with operations beginning as early as 2022.

The initial three liquefaction trains of the Freeport Liquefaction Project are under construction and are scheduled to begin operations sequentially between 4Q2018 and 3Q2019. Each liquefaction train has a capacity in excess of 5.0 mtpa. Approximately 13.4 mpta of the production capacity from the first three liquefaction trains has been contracted under use-or-pay liquefaction tolling agreements with Osaka Gas Co. Ltd., JERA Energy America LLC, BP Energy Co., Toshiba Corp. and SK E&S LNG LLC.

Thailand's PTT Public Ltd. Co. at the end of 2016 struck an agreement with BP plc for about 1 mtpa of LNG for 20 years beginning this year, with the LNG sourced from BP's supply portfolio, including the Freeport LNG export project.

Freeport LNG was authorized by the Federal Energy Regulatory Commission in 2014 to modify its existing terminal facilities in Texas for LNG exports, and by the Department of Energy (DOE) to export domestically-produced LNG to countries that do not have free trade agreements (FTA) with the United States.

In December, DOE followed in the Federal Energy Regulatory Commission's footsteps in authorizing what was essentially a true-up of authorized export volumes with production capacity of Freeport LNG's three-train FLEX project. FLEX (composed of Freeport LNG Expansion LP, FLNG Liquefaction LLC, FLNG Liquefaction 2 LLC, and FLNG Liquefaction 3) had asked DOE to amend an existing export authorization for exports from the Freeport, TX, terminal of 146 Bcf/year. Subsequent to that authorization and an approval from FERC, Freeport determined that the terminal would be capable of producing and exporting more LNG than initially thought.

DOE effectively added 125 Bcf/year to the previously authorized non-FTA export volume.

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