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Golden Pass LNG Terminal Authorized

The U.S. Department of Energy (DOE) has authorized Golden Pass Products LLC to export liquefied natural gas (LNG) from its LNG terminal in Sabine Pass, TX, to countries with which the United States has free trade agreements (FTA), the Houston-based company said.

Golden Pass Products, which is owned by state-run Qatar Petroleum International (70%) and ExxonMobil Corp. (30%), filed its LNG export application with DOE in August (see NGI, Aug. 27). The proposed project involves construction of liquefaction and export capabilities at the existing Golden Pass LNG facility. A final investment decision will be made following government and regulatory approvals, Golden Pass said.

The proposed project would have the capacity to send out approximately 15.6 million tons of LNG per year. New infrastructure required to export would be located on the existing property, which currently contains two berths for LNG tankers, five storage tanks and access to the Golden Pass pipeline. The expanded facility would then have the capability and flexibility to both import and export natural gas.

"If developed, the project would represent approximately $10 billion of investment on the U.S. Gulf Coast, generating billions of dollars of economic growth at local, state and national levels and millions of dollars in taxes to local, state and federal governments," Golden Pass said. "The project would generate approximately 9,000 construction jobs over five years with peak construction employment reaching about 3,000 jobs."

Federal permits must be obtained from DOE and the Federal Energy Regulatory Commission (FERC). DOE permits are required for exporting natural gas from the United States, and, under the Natural Gas Act, FERC has the final authority to approve the siting of facilities for import or export of natural gas.

Golden Pass said it also plans to submit an application to export LNG to non-FTA nations. "A final investment decision will be made following government and regulatory approvals and will be based on a range of factors," the company said.

Golden Pass Products is affiliated with Golden Pass Terminal LLC and Golden Pass Pipeline LLC, which since 2005 have constructed and operated the LNG import facility and distribution pipeline at Sabine Pass. The import terminal and pipeline were completed and became operational in 2010 (see NGI, Nov. 8, 2010).

DOE last month postponed the release of the second part of its study on the economic impact of exporting domestically produced LNG until year-end (see NGI, Sept. 24). The results of the second half of the study -- assessing the impact of LNG exports on domestic gas prices, job creation, gross domestic product and the balance of trade -- were due out by late summer, a DOE spokesman said in June (see NGI, June 4). That part of the study, which may recommend limiting exports to 6-7.4 Bcf/d, is being conducted by an independent third-party contractor.

Since April DOE has approved several export permits, including one by Cheniere units Sabine Pass LNG and Sabine Pass Liquefaction to export LNG to non-FTA countries (see NGI, April 23). Since then it has approved a number of more limited permits to export to FTA countries, but it has put the broader permitting process for non-FTA applications on hold pending the completion of the second half of the two-part study.

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