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Cove Point LNG export facility gets federal authorization to start service

The Federal Energy Regulatory Commission allowed Dominion Energy Cove Point LNG LP to place in service its Cove Point natural gas liquefaction and export project on the Chesapeake Bay.

The project is expected to enter commercial service in early March after service was delayed from late 2017. When it does, GAIL (India) Ltd. and a joint venture between Sumitomo Corp. and Tokyo Gas Co. Ltd. will receive LNG produced at the terminal under 20-year contracts.

Cove Point became the second major U.S. terminal to move LNG offshore March 1 when a tanker left the $4 billion export facility. With the LNG cargo, Cove Point joined Cheniere Energy Inc.'s Sabine Pass. Cove Point's LNG was produced during the commissioning process for the export terminal, built on the site of an LNG import terminal in Lusby, Md. In November 2017, the commission granted Cove Point authorization to export LNG produced in commissioning.

"At this time, the Cove Point liquefaction project is mechanically complete and able to physically flow gas. All engineering order conditions and commissioning demonstration tests required at Cove Point's LNG terminal are complete," the Cove Point developer said in a filing with FERC.

Shell NA LNG has an agreement with Dominion to provide gas to the Cove Point facility and take LNG that is produced before the terminal's in-service date.

FERC granted the Dominion Energy Inc. company authorization to commence service on the Virginia and Maryland facilities of the project in a March 5 letter.

The Cove Point export terminal has an LNG production capacity of 5.25 million tonnes per annum, equivalent to 8.3 million gallons per day. The facility will bring total U.S. liquefaction capacity to more than 23 mtpa. (FERC docket CP13-113)