Start of Elba Island LNG Production Approved by FERC

Kinder Morgan’s request to start production of liquefied natural gas at the Elba Island export facility has been approved by U.S. regulators. This facility is one of half a dozen in the United States beginning to produce LNG for export.

The Federal Energy Regulatory Commission approved Kinder Morgan’s request to “commence service for liquefaction and export activities” at the first train in a filing dated September 30th.

The facility is able to produce around 3 million tons per day of liquefied natural gas. Periodic delays since late last year have led to start-up problems and the company had to tweak the setup of its 10 trains.

In 2018, United States has exported 22 million tons per day of LNG and this year 26 million tons per day of LNG has been exported so far.


Kinder Morgan's Gulf LNG Project Gets Green Light from FERC

The Federal Energy Regulatory Commission gave Kinder Morgan the approval to build its Gulf LNG export project in Mississippi in a 3-1 vote. The proposed project would add 11.5 million metric tons of new capacity to Kinder Morgan's terminal in Pascagoula, Mississippi, which would include two liquefaction plants.

Some Democrats opposed and concerned about LNG terminals' impacts on climate change, but FERC Chairman Neil Chaterjee praised the vote tweeting, "This is big news for the US & our allies. Today's approval of #GulfLNG is significant for the economy & America's geopolitical interests."

The company initially developed the Gulf LNG site as a liquefied natural gas import terminal in 2009. But with record production from U.S. shale plays creating a surplus of natural gas, the company filed an application with FERC in July 2015 seeking permission to redevelop part of the site as an export terminal.

The project will also modify the existing Gulf LNG Pipeline allow for bidirectional flow. It's the fifth LNG export project the agency has approved so far this year.


$30 Billion Louisiana Driftwood LNG Project Eyes Final Decision in 2019

Final investment decision to build the proposed $30 billion Driftwood liquefied natural gas (LNG) export project in Louisiana will be taken in 2019, Tellurian Inc confirmed on Wednesday.

The company said that it is on track to make a final investment decision and start construction in 2019. The operations will begin in 2023 and is project is designed to produce 27.6 million tonnes per annum (MTPA) of LNG or about 4 billion cubic feet per day (bcfd) of natural gas.

The first phase will likely comprise 16.6 MTPA and together the projects would produce over 150 MTPA of LNG. The company is also developing three pipelines in Louisiana - the 4.0-bcfd Driftwood pipe, the 2.0-bcfd Haynesville Global Access and the 2.0-bcfd Delhi Connector - and the 2.0-bcfd Permian Global Access in Texas and Louisiana.


Lake Charles LNG Construction Bid Announced by Energy Transfer and Shell

Energy Transfer and Shell have issued an invitation tender for an engineering, procurement and construction contract to convert Energy Transfer's already existing liquefied natural gas import terminal in Lake Charles into an export terminal.

"We are excited to announce this major milestone in the development of the Lake Charles LNG liquefaction project," Lake Charles LNG President Tom Mason said in a statement. "The prospective bidders are world-class EPC contractors who will bring extensive LNG experience to bear as they develop their bids."

The facility was originally developed as an LNG import terminal in 2006 by Energy Transfer but later in 2015, FERC gave permission to build an export terminal at the site shortly after the shale revolution.

Once the export terminal project is completed, it is estimated to create up to 5,000 local jobs during construction and 200 full-time positions when fully operational. In 2016, Shell entered into a 50-50 joint venture with Energy Transfer to develop the liquefaction plant that can produce up to 16.45 million metric tons of LNG per year.


Alaska's New Governor Won’t Have a Say on $43 Billion Project Until It is Fully Examined

Alaska’s Governor Mike Dunleavy will “withhold judgement” on the $43 billion liquefied natural gas project until the “administration can fully understand the costs, risks, and potential benefits.”

The 800-mile pipeline will move North Slope gas to Nikiski at a plant that would liquefy it for shipment. Sales will be mostly targeted to buyers in the Asia market.

Dunleavy is the third governor to oversee the project which launched in 2012.

An approval for the project is not expected until February 2020.

Houston Chron

Cheniere Decides to Move Forward with Third LNG Unit in Corpus Christi

Cheniere Energy is moving forward with building a third unit to process liquefied natural gas at its export facility that is currently under construction in Corpus Christi.

Cheniere said this will be the first commitment to build new U.S. liquefaction capacity since 2015.

Bechtel is Cheniere's builder for this third unit and had started limited construction on it last year.

Two long-term deals to sell LNG to PetroChina International sparked Cheniere's decision to construct the third processing unit. The sale contracts extend through 2043.

Cheniere has been exporting natural gas through its Sabine Pass facility in Louisiana since 2016 and continues to expand in order to support more production and exports.

The number of foreign markets that receive LNG imports from the U.S. has been increasing. Freeport LNG and Kinder Morgan are scheduled to begin exporting LNG later this year.

Fuel Fix

U.S. Pipeline Permit Approvals May Be Tested as More LNG is Exported Overseas

As more liquefied natural gas comes into the U.S. market and is exported overseas, energy analysts say that FERC may have to grapple with arguments against pipeline approvals for public interest for the energy that isn't staying in the U.S.

When pipeline companies ask federal regulators for permits to construct proposed interstate natural gas pipelines in the U.S., they point to the necessity of ensuring adequate supplies of natural gas as an argument for receiving approval.

When FERC approves pipeline construction and issues permits, pipeline companies then have the right to force landowners to sell their private property for the project that is argued to be in the public interest.

But as more liquefied natural gas is sent overseas with increasing LNG export facilities in the U.S., the argument of public interest may be tested, especially by landowners who do not want to sell their land.

Energy lawyer Emily Mallen, who was in Houston recently talking about challenges facing the energy industry, said that FERC commissioners will most likely favor pipeline projects of companies who have already received permissions from landowners.

Houston Chronicle

Protestors Demand Enbridge's Line 5 Pipeline Be Shut Down

Over 60 people against the Enbridge Energy’s Line 5 pipeline located beneath the Straits of Mackinac gathered and protested at the home of Michigan Attorney General Bill Schuette demanding he shut down the line.

Protestors outside the Midland home held banners as they called on Schuette to take action on the line. Authorities were on the scene but did not make any arrests.

Calgary-based Enbridge Energy owns Line 5, a 63-year-old oil pipeline that carries about 23 million gallons of light crude oil and liquefied natural gas daily. It runs underground from northern Wisconsin and the southern tip of Michigan’s Upper Peninsula before it splits into two sections of pipe that run across the bottom of the Straits of Mackinac. It then continues into the refineries in Sarnia, Ontario.

Schuette and other elected officials have voiced their concerns of the line ever since a pipeline owned by Enbridge ruptured in Michigan and leaked over 800,000 gallons of oil into the Kalamazoo River and a tributary creek in 2010. Protestors urge Schuette to use his authority to shut down the line in order to protect the Great Lakes.

Enbridge is confident the line poses no risk to its environment as it is in good shape and has never leaked in its 63 years of operation.

New York Times

Kinder Morgan Receives FERC Approval for $2 Billion Liquefaction Project

Kinder Morgan reported Thursday that it received approval from the Federal Energy Regulatory Commission (FERC) for its $2 billion Elba Liquefaction Project, which is proposed for construction and operation at the existing Elba Island LNG Terminal near Savannah, Georgia.

The first of 10 liquefaction units will be placed and online by the second quarter of 2018 with the rest of the nine units starting operations by the end of 2018. This project is supported by a 20-year contract between Shell and Kinder Morgan and is expected to produce roughly 350 million cubic feet a day of liquefied natural gas.

Once the final regulatory approvals are granted for the project, construction could begin in as little as 60 days following the approval. Kinder Morgan reported earlier this year that it planned to sell a stake in the project to private equity groups in order to help with the financing of the project. Kinder Morgan’s idea is to cut capital costs during the current oil recession.

Kinder Morgan is headquartered in Houston, Texas and is the largest energy infrastructure in North America, owning interest or operating roughly 84,000 miles of pipeline and owning about 180 terminals.

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