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Sempra, Woodside Sign Pact For Liquefaction Project at Port Arthur Site

Units of Sempra Energy and Australia-based Woodside Petroleum Ltd have entered into a project development agreement to further boost their plans for the development of a liquefied natural gas (LNG) facility on property Sempra owns at Port Arthur, TX.

The agreement expands on a memorandum of understanding signed last year by outlining a framework for how the Sempra and Woodside units will contribute their experience and share costs related to the development, technical design, permitting and commercial development of the liquefaction and LNG export facility.

Last August, Port Arthur LNG LLC was granted authorization to export U.S. LNG to free trade agreement (FTA) countries from the proposed terminal (see Daily GPIAug. 27, 2015).

The export project is located at a site previously permitted for an LNG regasification terminal along the Sabine-Neches Ship Channel. It initially would have two natural gas liquefaction trains with a total export capability of approximately 10 million tonnes annually (mtpa), or 517 Bcf per year, along with LNG storage tanks and marine facilities for ship berthing and loading.

San Diego-based Sempra officials said the plans call for a three-mile portion of Highway 87 between the Intracoastal Waterway and Keith Lake Pass to be relocated and upgraded to accommodate construction of the marine terminal berth for docking and loading of LNG ships.

In March 2015, the pre-filing process with the Federal Energy Regulatory Commission was started for the Port Arthur project with completion expected later this year (see Daily GPIMarch 23, 2015).

Both parties said the ultimate development of Port Arthur will depend upon completing commercial agreements, gaining all regulatory permits, securing financing, "achieving other customary conditions," and making the final investment decision to proceed.

Octavio Simoes, president of Sempra LNG & Midstream, said the latest agreement builds on "our experience developing safe, reliable energy infrastructure in North America and Woodside's core strengths in construction and operation of LNG assets."

Sempra LNG successfully permitted Cameron LNG in Louisiana, whose liquefaction/export facilities are in construction. Port Arthur LNG is one of three liquefaction projects being developed by Sempra Energy. The other projects are the proposed expansion of Cameron LNG with trains No. 4 and No. 5 and liquefaction facilities at the existing Energia Costa Azul in Baja California, Mexico (see Daily GPI, Feb. 19, 2015; Nov. 5, 2014).

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