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Golar LNG leaves Delfin LNG export project

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Golar LNG leaves Delfin LNG export project

Golar LNG Ltd. has dropped out of its partnership with Delfin LNG LLC to develop the Delfin LNG export project off the Louisiana coast.

Golar Management Ltd. CEO Iain Ross said in an Aug. 29 earnings call that his company was looking to make more appropriate investments.

"So if you refer to the screening criteria that I mentioned — in that we need high-caliber customers who can reliably provide feedgas and put together an off-take that underpins the financing of the project, combined with co-investors to lift the project with us — we just didn't feel that the Delfin opportunity satisfied those criteria," Ross said. "It's really important for us to put our investment money and resources into the opportunities that have the greatest chance of getting to [a final investment decision]."

"Our portfolio is really coming along nicely, and we've got to drop off the ones that we don't think are going to get there in the near term," Ross said.

In June 2017, Golar and Delfin entered into a joint development agreement for a project in which Golar would use its floating liquefied natural gas technology. The agreement included working together on the financing, marketing, construction, development and operation of the Delfin LNG project.

Delfin had not yet responded to requests for comment Sept. 4.

The Federal Energy Regulatory Commission approved onshore facilities for the project in September 2017. The order required Delfin LNG to make the facilities available for service within two years. In June, the developer asked for an extension until March 28, 2023. The company said detailed engineering work and complex necessary commercial arrangements had caused development to move more slowly than expected. In a July 8 letter, FERC staff gave Delfin a one-year extension from the original deadline to Sept. 28, 2020, much less than the 3.5-year extension requested.

The project's onshore facilities would include metering, compression and piping infrastructure in Cameron Parish, La. The facilities would connect to four floating vessels about 40 nautical miles off Louisiana's coast that would liquefy natural gas for export. The floating gas liquefaction vessels would be capable of producing 13 million tonnes per annum of LNG.

The project, developed by Fairwood Peninsula Energy Corp.'s Delfin Midstream LLC and formerly by Golar, has secured major permits, but the developers have not made a final investment decision. (FERC docket CP15-490)