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CB&I wins $200mn Calcasieu Pass LNG contract

05 Jul 2017 17:33 (+01:00 GMT)
CB&I wins $200mn Calcasieu Pass LNG contract

Houston, 5 July (Argus) — Venture Global LNG has awarded engineering firm CB&I a contract worth almost $200mn to build two storage tanks for the planned Calcasieu Pass LNG export terminal in southwestern Louisiana.

Washington, DC-based Venture Global has proposed building the $4.5bn Calcasieu facility and the $8.5bn Plaquemines LNG export terminal in southeastern Louisiana. The company has raised $361mn to fund permitting and engineering, but it has not signed enough long-term customer deals to finance either project.

Calcasieu would be the first of the projects to come on line. It is scheduled to start operating in 2021. It is unclear when Plaquemines would be placed in service. Venture Global did not reply to an Argus inquiry today.

Calcasieu would have baseload capacity of 10mn t/yr, equivalent to 1.4 Bcf/d (40mn m³/d) of gas, and peak capacity of 12mn t/yr.

Texas-based CB&I would start build the two planned single-containment LNG storage tanks at Calcasieu in 2018. Each tank would have capacity of 200,000m³, equivalent to 4.1 Bcf of gas. Venture Global previously said the first tank would not be ready until six months after initial operations.

Until that tank is ready, the company plans to place LNG into ships directly from its liquefaction facilities or from a storage vessel with capacity of 120,000-210,000m³. The second storage tank would be ready one month after the first.

Shell in February 2016 signed a contract for up to 1mn t/yr of LNG from the Calcasieu project, the only customer deal that Venture Global has announced for far. US LNG developers have had difficulty securing customers since oil prices fell in mid-2014, as the economics of US LNG exports are based on a wide differential between domestic gas prices and global oil prices. Most long-term Asian LNG contracts are linked to oil prices.

Plaquemines would be built in two equal phases with combined baseload capacity of 20mn t/yr and peak capacity of 24mn t/yr.

Venture Global in February selected GE Oil & Gas to provide technology for the two projects. The deal would include a comprehensive solution for liquefaction, gas pretreatment and power.