LNG Companies Aim to Move Ahead with Projects

It’s shaping up to be an incredible year for U.S. LNG growth, with record levels of feedgas demand and exports along with progress on the regulatory front, as the Trump administration has cleared away hurdles that had previously stalled project development. Now, Cheniere Energy has announced a positive final investment decision (FID) on its Corpus Christi Midscale expansion. In today’s RBN blog, we take a closer look at the Midscale project and others that could move forward this year. 

The cascade of LNG export project news continues. In the past week, yet another “second-wave” U.S. LNG export project — NextDecade’s Rio Grande LNG — cleared FERC’s environmental review process. That follows news of three other projects that received their environmental approvals this month; plus two other projects — Tellurian’s Driftwood LNG and Sempra’s Port Arthur LNG — got final FERC authorization to construct their facilities, should they make the financial commitment to proceed; and, finally, plans for a brand new export terminal, Venture Global’s Delta LNG, were unveiled. All in all, there are more than 20 announced projects totaling 235 MMtpa (~35 Bcf/d) that are looking to catch the second wave of U.S. LNG exports in the next decade. The timing of their regulatory approvals and final investment decisions will determine, in part, when this next wave — or shall we say tsunami — of export demand will materialize. Today, we wrap up our second-wave LNG project update series with a look at the progress made by some of the remaining projects that we’re tracking.

There’s a tough race underway among U.S. LNG developers jockeying for position in the global LNG market. U.S. supply growth has spurred the development of more than two dozen LNG export projects, the bulk of them along the Texas/Louisiana Gulf Coast. But regulatory bottlenecks and deepening oversupply conditions in international markets are creating strong headwinds and slowing the momentum for some of these massive projects, making it harder and harder for them to reach the regulatory and commercial milestones they need to pass before they can progress to the construction phase. That said, several projects have eked out big wins in recent weeks, including Tellurian’s $7.5 billion memorandum of understanding with India’s Petronet LNG Ltd for its Driftwood LNG project, signed just this past weekend, and LNG Ltd.’s 2-MMtpa sales and purchase agreement for its Magnolia LNG, inked early last week. Today, we provide highlights of recent regulatory and commercial developments that are pacing the proposed export capacity additions.