The US Federal Energy Regulatory Commission (FERC) today authorized the Freeport LNG export project in Texas to begin construction of the liquefaction and gas pretreatment plants, but it is unclear when such construction will start because the project has not yet made a final investment decision (FID).
FERC on 30 July authorized construction of the project, which would be located at the site of the existing Freeport LNG import terminal, about 70 miles (113km) southwest of Houston. But the developer is required to submit implementation plans to get final clearance to begin specific parts of the project.
Today's order also said Freeport could proceed with initial site preparation.
FERC said some work cannot proceed yet because specified mitigating conditions to reduce environmental impacts from that work have not been implemented.The work that cannot yet begin is construction of the pretreatment plant's electric line and the pipeline-utility line system. It also said the project cannot yet use related ancillary areas for staging, storage and temporary work area, including the seaway dredged material placement area and new roads, or roads scheduled to be improved.
The company did not return an Argus inquiry asking when it might make an FID. The project previously said it would make an initial FID on its first two planned liquefaction trains soon after receiving FERC approval, and then a separate FID on the third train six to nine months later.
The company previously said the first train would come on line in mid-2018, the second in early 2019 and the third in late 2019. Each train would have a baseload capacity of 4.4mn t/yr, equivalent to 0.6 Bcf/d (17mn m³/d) of gas, and peak capacity of 5.13mn t/yr. The three trains and the associated facilities have an estimated cost of about $14bn.
Freeport has signed 20-year tolling deals for all of the nameplate capacity from the three trains.
Japanese utilities Osaka Gas and Chubu Electric Power have agreed to buy 2.2mn t/yr each, starting when the first train comes on line. The UK's BP has contracted for 4.4mn t/yr of capacity, beginning when the second train starts operating. South Korean utility SK E&S and Japan's Toshiba have each signed contracts for 2.2mn t/yr, starting when the third train comes on line.
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