Sempra Energy, Mitsubishi Corp. and Mitsui & Co. Ltd. have signed 20-year tolling capacity and joint venture (JV) agreements to support the development, financing and construction of a liquefied natural gas (LNG) export facility at the site of the Cameron LNG receipt terminal in Hackberry, LA.
The tolling agreements subscribe the full nameplate capacity of the three-train, 13.5- million tonne per annum (mtpa) facility that will provide an export capability of 12 mtpa of LNG, or about 1.7 Bcf/d, and the full regasification capacity of 1.5 Bcf/d. Each tolling agreement is for 4 mtpa.
“These agreements represent a major step forward in the development of our LNG export project at the site of the Cameron LNG facility,” said Sempra Energy President Mark A. Snell. “This project, one of the largest in Sempra Energy’s history, provides benefits to the local Louisiana economy, promotes a favorable balance of trade for the national economy, and supports national and international energy security by assuring reliable long-term gas supplies to U.S. allies and trading partners.”
The joint-venture agreement calls for affiliates of GDF Suez, Mitsubishi (through a related company jointly established with Nippon Yusen Kabushiki Kaisha) and Mitsui each to acquire 16.6% equity in the existing facilities and the liquefaction project. A Sempra Energy affiliate is to retain 50.2%.
The agreements are subject to a final investment decision by each party, finalization of permit authorizations, financing commitments and other conditions.
The anticipated incremental investment, the majority of which will be project-financed, is estimated to be approximately $6 billion to $7 billion, excluding financing costs. The total cost of the facility, including the cost of the existing facilities plus interest during construction, financing costs and required reserves, is estimated to be $9 billion to $10 billion. Construction is expected to start in 2014 with the first phase of liquefaction operations to commence in the second half of 2017. Full commercial operation of all three trains is expected in 2018.
Last year, Cameron LNG obtained approval from the U.S. Department of Energy (DOE) to export up to 12 mtpa to free trade agreement (FTA) countries; the authorization to export LNG to non-FTA countries is pending review by the DOE.
Cameron LNG initiated the pre-filing process with FERC in April 2012 and filed its permit application with the Federal Energy Regulatory Commission (FERC) last December, requesting approval to construct and operate the project. In April FERC issued a notice of schedule for environmental review that calls for the final environmental impact statement to be issued in November. “Cameron LNG is the first LNG export facility application pending before the FERC to have reached this important milestone in the permitting process and is expected to receive the FERC authorization in early 2014,” Sempra Energy said.
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