Houston — Kinder Morgan's Elba Liquefaction has encountered unspecified "minor issues" during commissioning of equipment that will be resolved before the Georgia export facility starts up, a spokeswoman said Tuesday.
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The spokeswoman, Katherine Hill, declined to offer any details, nor say how long it will be until the official startup of Train 1. Officials had previously said they expected to begin LNG production by the end of April. In-service had been targeted for May 1, but US regulatory approval remained pending as of Tuesday afternoon.
The planned 2.5 million mt/year terminal near Savannah is utilizing Shell's Movable Modular Liquefaction System. These small-scale liquefaction trains are largely assembled off-site, and they allow for relatively easy disassembly and redeployment should underlying market conditions change. The 10 units being installed at Elba mark the first time this specific technology is being deployed in the US.
"Since this is the first project using this specific configuration of liquefaction technology, we have experienced some minor issues that are being resolved as part of the process," Hill said in an email responding to questions. "We will release a formal statement when we go in service."
Backed by a 20-year offtake agreement with Shell, Elba is by far the smallest of the existing crop of major US LNG export terminals. Still, Kinder Morgan's terminal will provide a stable revenue driver in a new and growing sector for the pipeline operator.
The Houston-based company's network already moves more than a third of the gas consumed in the US, and feedgas demand from LNG export terminals, including its terminal, is expected to boost volumes on that network.
The operator expects that some 70% of the revenue associated with the project will be recognized with the first liquefaction unit in service. The subsequent nine trains are expected to come online sequentially, with one each month after the other, putting completion in February 2020 if startup of Train 1 occurs in May.
The company has said that the first export cargo will likely go out when sufficient LNG from the first train is accumulated in storage tanks, though the exact timing will be up to Shell.
Elba has taken delivery of roughly 3 MMcf/d of gas over the past three days, suggesting that commissioning at the facility is ongoing, but with volumes this low, it's unlikely that liquefaction is currently underway, S&P Global Platts Analytics data shows.
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