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Sempra LNG Begins FERC Process to Expand Still-to-Be-Built Cameron Terminal

Sempra Energy's liquefied natural gas (LNG) unit received FERC approval last week to begin the mandatory pre-filing process to expand the Cameron, LA, LNG terminal's production capacity up to 2.65 Bcf/d from the 1.5 Bcf/d capacity now being built. Driven by growing supplier interest, the formal expansion application will be filed later this year when the pre-filing process is completed with a final federal decision expected early next year, Sempra LNG said.

Sempra said the initial construction phase of Cameron near Lake Charles, LA, is underway with a targeted completion in late 2008. The proposed expansion could start in 2007 and be finished in 2010, the company said, noting it is timed to be ready for what Sempra sees as an expanding market at the Gulf of Mexico location.

"Because of its prime location on the Gulf Coast with access to the Midwest and East Coast markets, we have received enough interest from LNG suppliers for addition capacity at our Cameron terminal to begin the approval process," said Darcel L. Hulse, president of Sempra LNG. "We want to be prepared to meet the needs of the market as it develops."

Under the 2005 federal Energy Policy Act, all LNG facility applications must now undergo the pre-filing process, which is the same process Sempra said it voluntarily used on its third proposed LNG project at Port Arthur, TX, before the federal regulatory commission made the pre-filing process mandatory. Sempra is in the final stage of permitting the Port Arthur LNG facility, and it is hoping to begin construction at that site next year.

The expansion of Cameron, located along the Calcasieu River, 15 miles south of Lake Charles, is estimated by Sempra as a $250 million project, adding gas sprocessing facilities and one new LNG storage tank, requiring the development of an added 15 acres at the 275-acre site. Ultimately, there would be four LNG storage tanks at Cameron, each capable of storing 160,000 cubic meters of LNG.

The Cameron project gained FERC approval in 2004, and early last year Sempra LNG awarded the engineering/construction/procurement contract to a consortium comprised of Aker Kvaerner of Norway and Tokyo-based Ishikawajima-Harima Heavy Industries.

Sempra's other LNG terminal site along the Pacific Coast of North Baja in Mexico, Energia Costa Azul, is under construction with a target of operations beginning in early 2008.

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