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Kinder Morgan starts commercial service at Elba Island LNG terminal

Highlights

Smallest US export terminal reaches milestone

Progress underway on nine remaining trains

  • Author
  • Jim Magill
  • Editor
  • Keiron Greenhalgh
  • Commodity
  • LNG Natural Gas

Houston — Less than a week after federal officials gave the green light, Kinder Morgan announced the start of commercial service for the first of 10 proposed liquefaction trains at its $2 billion Elba Liquefaction project in Georgia.

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In a statement Friday, the Elba Liquefaction Co., a joint venture between Kinder Morgan and EIG Global Energy Partners, said the Elba Island project is now also able to produce LNG for export purposes.

Elba is the smallest of all the existing major US LNG export terminals. It could take as long as 100 days for the single operating train at Elba, with a nameplate capacity of around 33 MMcf/d, to fill a standard LNG cargo, according to S&P Global Platts Analytics data.

The milestone marked "an important step for the United States as the country becomes a key energy exporter," Kinder Morgan Natural Gas South Region President Norman Holmes said.

The project developers added they are also making progress on bringing the remaining nine units online. "Startup activities are underway on the second and third units, the commissioning of units four through six is ongoing, and construction on the remaining units is largely complete," Kinder Morgan said.

When completed, the Elba Island Liquefaction facility is expected to have a total capacity of about 2.5 million mt/year of LNG for export, equivalent to about 350 MMcf/d of natural gas.

With the first unit in service, the company said it is now earning about 70% of the expected total daily revenue of the liquefaction units.

On Monday, the US Federal Energy Regulatory Commission granted Kinder Morgan a permit to put the first train into commercial operation.

Kinder Morgan owns 51% of Elba Liquefaction and EIG owns the remaining 49%. Under their joint venture agreement, Elba Liquefaction will own the liquefaction units and other ancillary equipment, while Kinder Morgan owns 100% of certain other facilities associated with the project.

The project is supported by a 20-year contract with Shell, which will take 100% of the liquefaction capacity of the terminal.

-- Jim Magill, jim.magill@spglobal.com

-- Edited by Keiron Greenhalgh, newsdesk@spglobal.com