UPDATE 1-Cheniere gives green light for US LNG export plant build

Fri Aug 10, 2012 3:07am IST

Related Topics

Stocks

   
Kishore Pandey, 82, lies on a bed as his daughter, Usha Tiwari, holds him and a priest stands by them (L) at Mukti Bhavan (Salvation House) in Varanasi, in the northern Indian state of Uttar Pradesh, June 19, 2014. REUTERS/Danish Siddiqui

Waiting to die at Salvation House

The city of Varanasi is Hinduism's holiest city and many Hindus believe that dying there and having their remains scattered in the Ganges allows their soul to escape a cycle of death and rebirth.  Slideshow 

* Bechtel to begin building the $5.6 bln project

* Sabine Pass export plant completion expected in 2015

* First U.S. LNG export plant to be built since 1969

NEW YORK, Aug 9 (Reuters) - U.S. liquefied natural gas terminal developer Cheniere Energy has given the green light for construction of the first U.S. LNG export plant in a generation, which is expected to be ready by 2015, the company said in a statement on Thursday.

Bechtel Oil, Gas and Chemicals will now begin construction on the $5.6 billion project in Sabine Pass, Louisiana, that will open up vast reserves of cheap U.S. gas to needy import markets in Asia and Europe where prices for the fuel are many times higher.

The export plant, which will cool natural gas to a liquid for shipping overseas, will be built on the site of Cheniere's existing LNG import terminal which came online in 2008 but has since sat idle as record rises in U.S. domestic gas production dented import needs.

Sabine Pass LNG is expected online nearly 50 years after the Kenai export plant in Alaska - the only other U.S. LNG export terminal - was built in 1969. It will initially comprise two production units, the first arriving six to nine months before the second, the Houston-based company said. Two other units, called trains, are scheduled for 2017 and 2018.

Cheniere has already signed supply deals with buyers across the globe for nearly all the 2.2 billion cubic feet per day of capacity from the four production trains, approval for which was granted by federal regulators in April.

The customers include global LNG trader BG Group, Spain's Gas Natural Fenosa, South Korea's KOGAS and India's GAIL. BG will take supply from the first train and Gas Natural Fenosa will be supplied by the second train.

Cheniere's move to build the export plant comes as U.S. natural gas inventories sit at record highs due to prolific production from newly developed shale gas deposits.

A string of other export projects have been proposed in the United States to supply Europe and Asia.

However, for now, Cheniere looks likely to be the only project to get the go ahead. The U.S. government has suspended decisions on expanding U.S. gas exports until a study on the price impact of such exports on domestic consumers is completed late summer.

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

India-Nepal Ties

REUTERS SHOWCASE

Tackling Food Prices

Tackling Food Prices

India to free up extra 10 million tonne wheat in open market  Full Article 

Facebook Results

Facebook Results

Facebook beats Wall Street targets, stock hits record high  Full Article 

GM Recall

GM Recall

GM recalls 717,950 vehicles in U.S., not for ignition switches  Full Article 

Hyundai Motor Results

Hyundai Motor Results

Hyundai Motor Q2 profit slips as firmer won, U.S. discounts hurt  Full Article 

Nokia Results

Nokia Results

Nokia raises networks outlook after Q2 profit beats estimates  Full Article 

Factory Sector

Factory Sector

China July HSBC flash PMI at 18-month high of 52.0   Full Article 

Breakingviews

Breakingviews

Apple winds up earnings hope for new gadgets  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage