Freeport LNG Development LP last Wednesday got a two-year extension of its deadline to construct its FERC-approved liquefied natural gas (LNG) import terminal and associated gas pipeline facilities on Quintana Island near Freeport, TX.

The Federal Energy Regulatory Commission, in its June order approving the LNG project, gave Freeport LNG three years to build the terminal. But on rehearing, Freeport LNG sought a five-year construction window so that it could “meet pre-construction environmental mitigation conditions and make an allowance for unforeseen delays.”

The Commission granted Freeport LNG’s request, saying that “the five-year term is consistent with the terms authorized for the construction of other LNG terminals.”

Upon receiving FERC’s authorization in June, Freeport LNG became the second new LNG terminal project approved for construction in the United States in a little more than 25 years [CP03-75].

Freeport’s proposed terminal will include a marine terminal, LNG transfer lines and LNG storage and vaporization units. The marine terminal will have the capability to unload 200 ships each year. The sendout capacity of the facility will be up to 1.5 Bcf/d. The proposed two LNG storage tanks each will have the capacity to hold 3.5 Bcf/d.

The project, which will target the Texas market exclusively, also calls for the construction of nearly 10 miles of 36-inch diameter pipeline extending from the import terminal to a proposed meter station at Stratton Ridge storage hub in Brazoria County, TX, where the company says there is adequate takeaway capacity on intrastate pipelines.

The project is now targeted for completion and in-service on June 18, 2009, according to the FERC order [CP03-75]. Dow Chemical has signed a 20-year agreement to reserve 500 MMcf/d of the plant’s capacity. ConocoPhillips has entered into an agreement to fund the construction of the LNG facility (more than $500 million) in exchange for the remaining 1 Bcf/d of capacity, Freeport LNG said.

Freeport LNG, which is 60% owned by privately held Freeport Investment, also is partially owned by two Houston-based independents, Cheniere Energy Inc. and Contango Oil & Gas.

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