Just in time for the holidays, Cheniere Energy Inc. filed with the Federal Energy Regulatory Commission (FERC) applications for permits to construct liquefied natural gas (LNG) receiving terminals in Sabine Pass, LA and Corpus Christi, TX along with two related natural gas pipelines

Cheniere CEO Charif Souki first announced plans for the applications at the Department of Energy’s LNG Ministerial Summit in Washington, DC in mid-December. At that time, Souki said Cheniere had completed “exhaustive” studies on its proposed sites, which included 13 resource reports necessary for the Federal Energy Regulatory Commission applications. (see NGI, Nov. 24; Dec. 22).

One of the proposed connecting pipelines will run 120 miles from the Sabine Pass terminal site to the Henry Hub and the other one will run from the Corpus Christi terminal site to interstate pipelines located approximately 25 miles to the northwest. The company said it expects the Sabine pipeline to cost approximately $350 million and the Corpus Christi pipeline to come in at around $60 million. Each line is expected to have a capacity of 2.7 Bcf/d. The Houston-based company added that it expects the Sabine facility to cost $600 million and the Corpus Christi facility to run $500 million.

The filings mark a milestone in what has been an extended process. In June 2001, Houston-based independent Cheniere Energy Inc. acquired three land lease options in Texas to develop LNG terminals along the Gulf Coast (see NGI, June 18, 2001). The company picked up the lease site for the Sabine facility in December of that year (see NGI, Dec. 10, 2001).

The filing news follows an announcement earlier in December that its first project, Freeport LNG Development LP., in which Cheniere holds a 30% limited partner interest, has signed an agreement with ConocoPhillips whereby ConocoPhillips will fund the construction costs presently estimated at $400-450 million for a proposed LNG receiving terminal in Freeport, TX. Approval from FERC for this project is expected in the first quarter of 2004 with construction to start in the second half of 2004, aiming at a 2007 in-service date.

Cheniere currently owns a lease on a fourth proposed LNG import terminal site in Brownsville, TX, but the company said there is no current activity on those plans. A company spokesman noted that the Brownsville site has good water access, but is currently a good distance from tying into current pipeline infrastructure. He noted the Brownsville site is being held for the future and could make a “nice play” for Mexico.

“Since all of the 1.5 Bcf/d LNG receiving capacity planned for Freeport has been allocated to ConocoPhillips and Dow Chemical, we are now totally focused on our next two sites, Sabine Pass and Corpus Christi,” Souki said in announcing the applications. “Because of the strong interest our first project received, these terminals will be larger, each with two unloading docks, three 160,000 cubic meter tanks (10.1 Bcf), and the ability to import 2.6 Bcf per day of natural gas.”

Speaking on the proposed pipelines, Souki added, “The 120-mile Cheniere Sabine Pass pipeline will provide our LNG receiving terminal customers with a significant amount of downstream optionality. The pipeline will be an attractive commerce point, in that it will have a near limitless supply on one end, and the Henry Hub liquidity point on the other. The 25-mile Cheniere Corpus Christi pipeline will link the Corpus Christi LNG receiving terminal with a significant corridor of pipeline capacity providing access not only to the significant markets of Texas, but also to the interstate and Mexican markets.”

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