FERC has given the proposed Magnolia liquefied natural gas (LNG) export project near Lake Charles, LA, and an associated Kinder Morgan Inc. pipeline expansion five additional years to be placed in service because of the difficulty in securing long-term customers to finance the project.
The 8.8 million metric ton/year (mmty) project and the so-called Lake Charles Expansion Project on the Kinder Morgan Louisiana Pipeline (KMLP) must be placed in service by April 15, 2026, the Federal Energy Regulatory Commission said Wednesday. The proposed KMLP line would supply up to 1.4 Bcf/d to the project for 20 years.
Magnolia owner Glenfarne Group LLC and Kinder Morgan last month requested the time extension because “unforeseeable developments in the global LNG market have affected Magnolia LNG’s ability to enter into long-term LNG offtake contracts with international customers, which are critical to securing project financing and achieving” a positive final investment decision (FID).
FERC authorized construction in April 2016 with a five-year time frame to place it in service. The developers could seek additional time extensions if necessary.
Glenfarne founder Brendan Duval told NGI in June that the New York-based company expects to reach an FID by the end of 2021 on both Magnolia and its Texas LNG export project near Brownsville, TX.
Glenfarne acquired Magnolia in June for $2 million from Australia’s Liquefied Natural Gas Ltd. after two previous deals fell through.
“We believe Magnolia LNG has the right size and scope to best compete in the current and future LNG market and is well-positioned to meet global demand starting in the middle of this decade,” Duval said Thursday.
© 2020 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 | ISSN © 1532-1266 |