Lake Charles Exports LLC (Lake Charles) Wednesday became the third prospective liquefied natural gas (LNG) terminal tapped by the U.S. Department of Energy (DOE) to export domestic natural gas worldwide, bringing authorized export volumes to 5.6 Bcf/d.
Exports to countries that do not have a free trade agreement with the United States are to take place from the Trunkline LNG Co. LLC terminal in Lake Charles, LA. Lake Charles, a jointly owned unit of BG Group plc and Southern Union Co., previously received approval for more limited exports to FTA countries on July 22, 2011 (seeDaily GPI, Aug. 8, 2011).
"Subject to environmental review and final regulatory approval, the facility is conditionally authorized to export at a rate of up to 2 Bcf/d for a period of 20 years," DOE said.
BG's BG LNG Services LLC (BGLS) and Trunkline plan to modify existing LNG importation and regasification facilities at Lake Charles to permit LNG to be unloaded from the terminal's existing storage tanks onto vessels berthed at existing marine facilities. Gas liquefaction facilities also would be added to receive and liquefy pipeline gas.
With the proposed modifications, the Lake Charles terminal would be bidirectional, with the ability to receive and regasify LNG and liquefy domestic gas for export. The project still must receive authorization for construction from the Federal Energy Regulatory Commission.
Gas to be exported would be sourced primarily from Louisiana and Texas as well as the offshore, but it could come from anywhere in the Lower 48 states, the project backers said.
The proposed liquefaction and export facilities would be the subject of a long-term service agreement between BGLS and Trunkline. Lake Charles plans to enter into a long-term LNG export contract with BGLS "on a date closer to the date of first export," DOE's order said.
DOE granted the first authorization to export LNG to non-FTA countries in May 2011 from the Sabine Pass LNG Terminal in Cameron Parish, LA, at a rate of up to 2.2 Bcf/d (see Daily GPI, May 23, 2011), and the second authorization in May 2013 from the Freeport LNG Terminal in Quintana Island, TX, at a rate of up to 1.4 Bcf/d (seeDaily GPI, May 20).
"The development of U.S. natural gas resources is having a transformative impact on the U.S. energy landscape, helping to improve our energy security while spurring economic development and job creation around the country," DOE said. "This increase in domestic natural gas production is expected to continue, with the Energy Information Administration forecasting a record production rate of 69.96 Bcf/d in 2013."