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FERC Approves Commercial LNG Service From Dominion Cove Point

FERC has granted permission for Dominion Energy to begin commercial service for its liquefied natural gas (LNG) export facility on Chesapeake Bay in Maryland.

In a letter order Monday, the Federal Energy Regulatory Commission authorized Dominion Energy Cove Point LNG LP to commence service for facilities in Maryland and Virginia involved in the Cove Point Liquefaction Project, which includes its terminal at Lusby, MD [CP13-113]. The letter was in response to a request by Dominion last Friday to begin commercial service.

"Based on Commission staff inspections and review of the commissioning activities, Dominion has demonstrated that the above-mentioned facilities have been constructed in accordance with Commission approval and applicable standards and can be expected to operate safely as designed," wrote Rich McGuire, a director at FERC. "Further, based on Commission staff inspections, I note that project areas within the Virginia and Maryland facilities have been satisfactorily stabilized and are in compliance with the terms of the order."

An LNG tanker owned by a subsidiary of Royal Dutch Shell plc arrived at Cove Point last week and departed on Friday. Dominion confirmed that the Gemmata, a Singapore-flagged, G-Class tanker owned by Shell NA LNG, had been loaded with the first export cargo and that final commissioning work at the facility was underway.

Cove Point is the second U.S. facility to export LNG sourced from domestically produced natural gas in the Lower 48. Cheniere Energy Inc.'s Sabine Pass LNG terminal in Cameron Parish, LA, began exporting gas in February 2016.

Cove Point's marketed capacity is fully subscribed under 20-year service agreements. Pacific Summit Energy LLC, a U.S. affiliate of Japan's Sumitomo Corp., as well as Gail (India) affiliate Gail Global (USA) LNG LLC, have each contracted for half of the marketed capacity. Sumitomo has agreements to serve Tokyo Gas Co. and Kansai Electric Power Co. Inc.

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