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Northeast Gateway Receives First LNG Tanker, Begins Operations

Houston-based Excelerate Energy LLC announced last Monday that its Northeast Gateway offshore system in Massachusetts Bay received its first liquefied natural Gas (LNG) tanker shipment over the weekend of May 17-18 and had begun commercial operations.

The company received 1 Bcf of LNG aboard the tanker Excellence from Trinidad Saturday (May 17), said spokesman Doug Pizzi. The off-loading of the cargo began that day and was continuing through early last week, he noted.

According to Stacy Nieuwoudt, an analyst with Tudor, Pickering, Holt & Co. Securities Inc., the Northeast Gateway facility is processing at 50% of capacity at approximately 0.4 Bcf/d.

The inaugural delivery will be used to test all of the port and pipeline systems. The delivery follows preliminary commissioning activities that were conducted in February. Ultimately the system is capable of supplying up to approximately 20% of New England's natural gas demand, Pizzi said.

The completion and commissioning of the Northeast Gateway system, which is located 18 miles east of Boston, marks the first new LNG receiving terminal to be built on the U.S. East Coast in more than 30 years, according to Excelerate Energy.

The Northeast Gateway facility consists of two submerged buoys that will attach to specialized ships capable of regasifying LNG on board and sending it into a subsea pipeline system. Exclerate Energy and Spectra Energy's Algonquin Gas Transmission have teamed up to extend a 16-mile, 24-inch diameter pipeline lateral from Algonquin's HubLine system to the Northeast Gateway port. The HubLine system runs under the ocean floor across Massachusetts Bay and connects to the New England natural gas grid.

Northeast Gateway said the system has the capacity to deliver up to 800 MMcf/d of natural gas into Algonquin's HubLine.

Excelerate Energy began the permitting process for Northeast Gateway in June 2005 and received its license for the facility in May 2007. Construction began immediately and was completed in December 2007, according to the company (see NGI, April 14).

In a related development, Excelerate Energy announced the signing of definitive agreements with Argentina's YPF S.A. to develop an LNG import facility at the port of Bahia Blanca, approximately 400 miles south of Buenos Aires. Upon completion of the facility this month, it will mark South America's first-ever LNG receiving facility and the world's second dockside regasification facility.

"This facility marks yet another milestone for Excelerate Energy and further demonstrates how the unique ability of our onboard regasification and GasPort technology can quickly and cost-effectively deliver LNG supplies and connect markets globally," said Excelerate Energy CEO Rob Bryngelson.

The jointly developed Bahia Blanca GasPort, Excelerate's fourth operational LNG facility and second dockside GasPort, will allow delivery of up to 400 MMcf/d of natural gas to Argentina's market. The facility, "which is pretty much almost done," was built with the initial capacity to import up to three LNG cargoes per month, each of which contains approximately 3 Bcf of natural gas.

The GasPort process is "very quick, very fast and very efficient," a spokeswoman said. It takes "less than a month to get it all done," enabling the first cargo to arrive at the new Bahia Blanca GasPort by the end of this month, she noted.

Excelerate Energy currently is the only LNG company in the world using GasPort technology. The company's first GasPort at Teesside in the United Kingdom was commissioned in February 2007. These facilities are designed to accommodate the proprietary technology of the company's specialized Energy Bridge vessel fleet. At the Bahia Blanca GasPort, the company's Energy Bridge vessel Excelsior will dock alongside a dedicated jetty where it will connect to the onshore facility and feed natural gas directly into Argentina's gas distribution system.

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