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Energy Bridge Terminal Prepares for First 3 Bcf LNG Delivery This Month

Excelerate Energy's Gulf Gateways Energy Bridge is scheduled on March 20 to become the world's first operational deepwater liquefied natural gas (LNG) port. The port, which is located 116 miles off the south coast of Louisiana in 298 feet of water, will deliver about 3 Bcf of regasified LNG into the pipeline grid via the Sea Robin and Blue Water subsea systems at a rate of about 500 MMcf/d.

"Some of these pipelines have not seen this much gas, they told us, for 15 years," said Excelerate Energy CEO Kathleen Eisbrenner in an interview with NGI. "They are pretty happy. They've been running at a 30% load factor and here comes a 500 MMcf/d well!"

Excelerate estimates its first LNG vessel will arrive at its specialized buoy on March 17. There will be a couple of days of equipment commissioning and then it will begin regasification March 20.

The company has been working with the pipelines to prepare contractually and physically for the large amount of new gas that will enter the pipeline grid. "The metering platform and associated pipes are gassed up and ready to go, all the valving is in place and the pipelines have been pigged," said Eisbrenner.

Another 3 Bcf cargo is expected to arrive next month and by the end of the year Excelerate could be receiving three cargoes/month, or about 9 Bcf/month, she said. "We are working on cargoes through the end of the year but we're not really focused on beyond that at this point. We'll start with one cargo a month and probably end the year with two to three. We can ramp up to 4-5 cargoes a month next year. That would bring the [average sendout] to 500-600 MMcf/d.

"We have one ship commissioned now. We'll have another in April and then a third in October of 2006," she said. "We also are looking at some other ways to increase our capacity utilization despite the finite number of Energy Bridge vessels."

Excelerate's model is unique in the LNG business. The company has commissioned the construction of specialized 138,000 cubic meter LNG vessels with onboard regasification and specialized equipment that facilitate deliveries directly into a special buoy that is connected to existing offshore subsea pipelines.

One major fault in the business model is that conventional LNG vessels cannot deliver into Excelerate's deepwater port. In the LNG business, which is built around 20-year contracts with only occasional bids for excess cargoes, that's a major problem.

However, Eisbrenner said Excelerate already is planning a way around that. "We've designed a couple other technologies that could be built very quickly that might facilitate the transshipment of LNG and/or the use of our existing port for a regasification facility that will allow conventional vessels to dock," she said.

"We have a physically permitted port in the Gulf of Mexico. We could use the port for a barge that would have onboard regas equipment which would then allow conventional vessels to come and off-load through that. We would have to have it built. But we are more than just looking at that right now." Eisbrenner would not say when Excelerate would be prepared to handle conventional vessels.

For now the privately-owned company is content to move forward with what will be the first new LNG terminal in North America. The Energy Bridge facility was the second application for a deepwater port received by the Maritime Administration (MARAD) on Jan. 23, 2003. MARAD has permitted two other deepwater LNG ports to date: Shell's Gulf Landing port in Cameron Block 213 and ChevronTexaco's Port Pelican port in Vermillion Block 140, which was the first port application filed. Gulf Gateways Energy Bridge received a favorable record of decision on Dec. 31, 2003 and a license to construct, operate, and decommission the facility on May 26, 2004. MARAD has applications for six others on file.

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