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First Sabine Pass Cargo Delayed Until Late February, Early March

The Sabine Pass liquefied natural gas (LNG) terminal will ship its first cargo later than initially thought, according to an announcement Thursday by Cheniere Energy Partners LP.

The Cameron Parish, LA, liquefaction projection was previously expected to begin service later this month (see Daily GPI, Dec. 23, 2015), but Cheniere said what is expected to be the first LNG export from the Lower 48 would have to be pushed back to late February or early March.

The company said construction of Train 1 at Sabine Pass “was completed well ahead of the guaranteed contractual schedule,” but “instrumentation issues” discovered “during the final phases of plant commissioning and cooldown” will require additional work, thus delaying the project.

Interim CEO Neal Shear added that “construction for Trains 2-5 continues to be on an accelerated schedule and these trains are expected to come online on a staggered basis.”

Cheniere said it has entered into six third-party LNG sale and purchase agreements totaling roughly 19.75 million metric tons a year that will begin with the first commercial delivery of Trains 1-5.

In its latest Short-Term Energy Outlook, the Energy Information Administration (EIA) said it expects LNG exports to help sustain domestic natural gas production in 2016 and 2017. EIA forecasts 0.7 Bcf/d of LNG exports in 2016, increasing to 1.4 Bcf/d in 2017 (see Daily GPI, Jan. 13a). Analysts, meanwhile, have noted weaker demand for LNG from Asia in 2015, a key market for U.S. exports (see Daily GPI, Jan. 13b).

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