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FERC Orders Bring Trains at Cheniere’s Corpus Christi, Sabine Closer to Service

A pair of FERC orders Thursday brought Cheniere Energy Inc. a step closer to starting up trains at its Corpus Christi and Sabine Pass liquefied natural gas (LNG) terminals in the Gulf Coast.

Federal Energy Regulatory Commission staff granted a request from Cheniere’s Corpus Christi Liquefaction LLC to introduce refrigerants into Train 1 at the South Texas LNG facility. In a separate order, FERC authorized Cheniere’s Sabine Pass Liquefaction LLC and Sabine Pass LNG LP to introduce refrigerants into the Cameron Parish, LA, facility’s Train 5.

In 2016, Cheniere became the first in a wave of U.S. LNG export projects when Sabine Pass shipped the first major LNG export volumes from the Lower 48.

Cheniere has said it plans to bring Train 5 at Sabine and the first two trains at Corpus Christi into service by next year. Cheniere began construction on a third train at Corpus Christi after reaching a final investment decision earlier this year.

Cheniere’s Corpus Christi and Sabine trains are part of an anticipated ramp up in U.S. LNG export capacity over the next few years. In August, analysts with Barclays Capital cited the potential for earlier-than-expected start-ups at the two Cheniere facilities in raising the firm’s Henry Hub natural gas price forecast.

Earlier this week, the Energy Information Administration (EIA) cited increased natural gas demand from LNG exports as part of its rationale for a forecast $3.20/MMBtu average Henry Hub price this winter, an 8% increase year/year (y/y). This comes as U.S. natural gas exports more than doubled y/y through the first half of 2018 thanks to LNG.

With LNG export projects slated to enter service all along the Gulf Coast, U.S. pipeline capacity into the region has been ramping as producers and midstreamers aim to capture the new demand. EIA estimated that natural gas pipeline capacity into the South Central region will reach 19 Bcf/d this year.

Last month, FERC authorized service on the first phase of Natural Gas Pipeline Company of America LLC’s Gulf Coast Southbound Expansion Project, which would help expand delivery capacity into the Cheniere Corpus Christi Pipeline to serve its new terminal.

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