FERC gave final environmental clearance to Sabine Pass LNG LP’s liquefied natural gas (LNG) terminal and associated pipeline facilities, putting the project to be sited in Cameron Parish, LA, one step closer to receiving a certificate, parent Cheniere Energy reported Friday.

The Commission staff, in a final environmental impact statement (FEIS), concluded that approval of the 2.6 Bcf/d Sabine Pass LNG terminal and pipeline project would have limited adverse environmental impact if recommended mitigating measures were used.

Agency staff further said the onshore terminal and LNG tanker traffic would pose little risk to the public. “The likelihood of a cargo containment failure and subsequent LNG spill from a vessel casualty — collision, grounding or allision [contact with fixed object] — is highly unlikely. For similar reasons, an accident involving the onshore LNG import terminal is unlikely to affect the public. As a result, the risk to the public from accidental causes should be considered negligible.”

By issuing the FEIS, staff removed the last hurdle in the way of the Federal Energy Regulatory Commission granting Section 3 authorization to Sabine Pass LNG. FERC typically approves a project just weeks after a FEIS is issued. The Commission has approved two new LNG facilities so far — Freeport LNG Development LP’s proposed terminal and pipeline facilities on Quintana Island in Brazoria County, TX; and Sempra Energy’s $700 million Cameron LNG facility in Hackberry, LA. Sabine Pass LNG would be the third new LNG terminal built in the continental United States.

In related developments last week, Total LNG USA Inc. and an affiliate of ChevronTexaco Global Gas reported they signed separate 20-year agreements with Sabine Pass LNG to buy a total of 1.7 Bcf/d of regasification capacity at the company’s proposed receiving terminal on the Gulf Coast

Total LNG USA, a unit of French-based Total SA, exercised its option to acquire 1 Bcf/d of regasification capacity at the proposed facility, while the Chevron Texas Global Gas sister company signed an initial deal for 700 MMcf/d of capacity at the Sabine Pass LNG project. In addition, the ChevronTexaco Global Gas affiliate reported it has the option to obtain a 20% limited partner interest in the Sabine Pass LNG project.

The ChevronTexaco and Total agreements came only one day after Cheniere Energy announced it signed financing agreements with HSBC Securities (USA) Inc. and SG Corporate & Investment Banking, an arm of Societe Generale, for the $741 million debt component of the project financing for the construction of the Sabine Pass project.

Since the disclosure of the two agreements, Cheniere Energy stock has shot up from $26.21 a share at the close of trading last Monday to $44.42 in afternoon trading Friday.

The LNG project, which would be located on the Texas-Louisiana border not far from the Henry Hub, would have a send-out capacity of 2.6 Bcf/d and total plant capacity of 2.8 Bcf/d, and three 160,000 cubic meter storage tanks. The in-service date is targeted for late 2007.

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