Energy Transfer Equity LP’s Trunkline LNG Co., Trunkline LNG Export and Trunkline Gas Co. units have filed to initiate the prefiling review process with the Federal Energy Regulatory Commission for their plan to build a natural gas liquefaction project in Lake Charles, LA.

The joint venture formed by Houston-based Southern Union and BG LNG Services LLC, a subsidiary of BG Group plc — Lake Charles Exports LLC (see Daily GPI, May 10, 2011) — has received approval from the U.S. Department of Energy (DOE) to export LNG to countries with which the United States has a free trade agreement (see Daily GPI, Aug. 8).

Energy Transfer completed its acquisition of Southern Union last month (see Daily GPI, March 27).

The parties said they expect to file a formal application under Section 3 of the Natural Gas Act by March 2013. The liquefaction project is being developed to liquefy domestic gas for export in order to meet the growing worldwide demand for liquefied natural gas (LNG). Energy Transfer and its subsidiaries are working with customer BG Group plc to develop the project.

The project is one of a handful of such ideas proposed for the U.S. Gulf Coast, the West Coast and the East Coast (see Daily GPI, March 29; March 27). Other projects are pending in Alaska (see Daily GPI, April 2) and Western Canada (see Daily GPI, Feb. 10).

The backers of the Lake Charles Liquefaction Project want to receive an order authorizing construction by January 2014 and said they expect the project to take 48 months from construction to start-up.

“The proposed Lake Charles Liquefaction Project would be located on a site approximately one-half mile west of the existing Trunkline LNG Lake Charles Terminal Facilities,” the filing said. “Trunkline LNG Co. LLC/Trunkline LNG Export LLC is currently in negotiations for an option agreement with the Lake Charles Harbor and Terminal District for a long-term lease for the property.”

The main components of the project are to be three liquefaction trains, each capable of processing up to 800 MMcf/d of domestic gas. Trunkline Gas Co. plans to extend its interstate gas pipeline about one-half mile to provide feed gas to the liquefaction facility. The project is currently planned to export up to 15 million metric tons of LNG per year, which is the equivalent of about 2 Bcf/d. Trunkline LNG Export expects to begin construction in 2014 for in-service in spring 2018.

The filing said Trunkline LNG Co. has consulted with the U.S. Coast Guard (USCG) and has been informed that since the proposed modifications to the existing facility lie outside of the marine transfer area, a new letter of intent will not be required. Further, the USCG told the company that since the project will not increase the size or frequency of vessel traffic, the most recent waterways suitability assessment will remain valid and no further modifications will be required.

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