Trinidad and Tobago, the largest exporter of liquefied natural gas (LNG) to the United States, is in negotiations with Freeport-McMoRan Energy on a possible ownership stake in Freeport’s Main Pass Energy Hub LNG regasification project offshore Louisiana, Trinidad Energy Minister Eric Williams announced last week.

Williams made the announcement at the opening of the Latin America and the Caribbean Gas Summit in Trinidad. A spokesman for Freeport-McMoRan could not confirm the negotiations, but he said the company has been “actively discussing supply arrangements with LNG exporters in the Atlantic Basin for some time.”

Williams said the government of Trinidad and Freeport-McMoRan have signed a memorandum of understanding on a partnership in the Main Pass project, which already has been filed with the U.S. Coast Guard. The facilities could be operational by late-2007.

The $440 million, 1 Bcf/d LNG project at Main Pass Block 299 would be developed at a discontinued sulfur mining operation at one of the largest platform configurations in the Gulf, about 16 miles east of the mouth of the Mississippi River in 210 feet of water. McMoRan also is planning to develop 28 Bcf of working gas storage capacity in a salt formation at the site. Aggregate peak gas deliverability from the proposed terminal, including deliveries from storage would total 2.5 Bcf/d.

Sen. Mary Landrieu (D-LA) and Louisiana Governor Kathleen Babineaux Blanco have publicly expressed their support for the project, which they believe would provide needed supply for Louisiana end users and significant economic benefits for the state.

Williams said Trinidad has received a dozen proposals for partnerships in proposed regasification terminals in the United States, but selected the Freeport project. “The large number of companies seeking some form of alliance with our country reflects the attractiveness of the opportunity for establishing more regasification terminals in the U.S. and for sourcing secure supplies of LNG,” Williams said, according to Reuters.

Accessing supply is a key piece of the LNG chain. LNG developers have estimated the upstream costs to develop the resources, gasify and deliver the LNG are 80% of the overall costs, with the receiving terminal representing only 20%.

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