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Corpus Christi LNG Project Delayed Until 2012

FERC on Friday granted to Cheniere Energy subsidiary Corpus Christi LNG an extension of time for constructing and placing into interstate service its liquefied natural gas (LNG) terminal and associated pipeline facilities near Corpus Christi, TX.

In a motion filed earlier this month, Corpus Christi LNG requested an extension until April 18, 2012, saying the additional time was needed due to current market conditions in the LNG industry, including the delay in development of liquefaction facilities overseas.

Corpus Christi LNG -- a partnership of Corpus Christi LNG LP and Cheniere Corpus Christi Pipeline LP -- was first authorized by the Federal Energy Regulatory Commission (FERC) to site, construct and operate the LNG facility nearly three years ago (see NGI, April 18, 2005). That order required Corpus Christi LNG to complete construction of, and make available for service, the authorized facilities within three years of the date of the order.

Later the same year FERC gave the go-ahead for initial construction of the import terminal adjacent to a Sherwin Alumina plant on the northern shoreline of Corpus Christi Bay (see NGI, Dec. 19, 2005). The terminal would have the capacity to process 2.6 Bcf/d of regasified LNG and would have three LNG storage tanks, with an aggregate storage capacity of 10.1 Bcf of natural gas equivalent. The project also calls for the construction of the Cheniere Corpus Christi Pipeline, which would provide takeaway capacity from the terminal. The pipe system would consist of 23 miles of 48-inch diameter facilities, with eight interconnects to existing intrastate and interstate pipelines.

Corpus Christ was the third LNG terminal that FERC approved for Cheniere along the Gulf Coast. In December 2004 FERC granted a certificate to Cheniere for the development and operation of the $750 million, 2.6 Bcf/d Sabine Pass LNG terminal in Cameron Parish, LA (see NGI, Dec. 20, 2004). Prior to that, the agency approved the Freeport LNG terminal in Brazoria County, TX, a project Cheniere entered into with ConocoPhillips, Contango Oil & Gas and Dow Chemical (see NGI, June 28, 2004).

The extension order came just one day after Cheniere announced that the Celestine River LNG vessel had departed from the Nigeria LNG terminal carrying its first cargo of LNG destined for the Sabine Pass terminal (see related story). Several LNG cargoes are expected to be delivered into the Sabine Pass terminal from Nigeria by early April (see NGI, March 24).

Cheniere still holds a 30% limited partner interest in the $1 billion Freeport terminal, which is due to be finished by June (see related story).

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