Dominion announced Monday that it has fully subscribed the marketed capacity of its proposed export liquefaction facility under 20-year terminal service agreements.

Pacific Summit Energy LLC, a U.S. affiliate of the Japanese trading firm Sumitomo Corp., and GAIL Global (USA) LNG LLC, a U.S. affiliate of GAIL (India) Ltd., have each contracted for half of the marketed capacity. Sumitomo in turn has announced agreements to serve Tokyo Gas Co. and Kansai Electric Power. GAIL is the largest natural gas processing and distributing company in India.

Dominion has awarded its engineering, procurement and construction (EPC) contract for the new liquefaction facilities to IHI/Kiewit Cove Point, a joint venture between IHI E&C International Corp. of Houston and Kiewit Corp. of Omaha, NE, following completion of the front-end engineering and design work.

Dominion Cove Point LNG LP (DCP), a subsidiary of Richmond, VA-based Dominion, also filed an application at FERC seeking authorization to proceed with its $3.4-$3.8 billion liquefied natural gas (LNG) export facility, to be sited along with its import facility in Calvert County, MD, and associated interstate natural gas pipeline facilities. The export facility will have a marketed capacity of up to 5.75 million metric tons per annum (MTPA), of which only 4.6 MTPA is being marketed now, said Dominion spokesman Dan Donovan.

DCP also has proposed adding compression to its existing Pleasant Valley Compressor Station and modifying its existing Pleasant Valley M&R site and existing Loudoun M&R site, which, together with the use of turnback transportation capacity, will enable DCP to transport on a firm basis 860,000 Dth/d of natural gas from existing pipeline interconnects near the end of the Cove Point Pipeline to the LNG terminal for the export customers.

Dominion has called on the Federal Energy Regulatory Commission (FERC) to act on its application by February 2014 so that it can place the export facilities into service by mid-2017.

“We believe that having achieved these milestones of signed terminal service agreements, an EPC contract and our FERC filing, we are well positioned to obtain permission from the U.S. Department of Energy [DOE] to move forward with this vital infrastructure project,” said Dominion Chairman Thomas F. Farrell II.

Dominion has received permission from DOE to act as an agent for LNG exports to countries that have free trade agreements (FTA) with the United States. It is awaiting action on its application to export to non-FTA countries (see Daily GPI, Jan. 7).

The customers also have signed 20-year precedent agreements for first transportation service on the 88-mile Cove Point pipeline, which connects the facilities to a nexus of interstate natural gas pipelines in northern Virginia. The customers will procure their own gas and deliver it to the Cove Point pipeline.

While the gas liquefied at Cove Point may be sourced from a wide variety of areas, Farrell noted that Cove Point — located on the Chesapeake Bay — will be a premier facility in terms of direct access to Marcellus and Utica shale plays, two of the most prolific natural gas basins in North America.

©Copyright 2013Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.