Washington — The Federal Energy Regulatory Commission continued advancing LNG projects May 16, granting approval to a fourth train at the Freeport LNG export terminal in Texas that would add up to 5.1 million mt/year of liquefaction capacity to the facility.
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For a fourth time this year, FERC voted 3-1 to advance an LNG facility, with Democratic Commissioner Cheryl LaFleur joining Republicans to back the project despite her ongoing concerns about FERC's approach to greenhouse gas considerations. LaFleur also said the commission's decision to do an environmental assessment, rather than an more extensive environmental impact statement heightened the legal risk in this case.
FERC Chairman Neil Chatterjee said he was pleased to be acting again on a bipartisan basis, noting FERC has certificated nearly 8 Bcf/d in LNG export capacity since February. "This capacity will spur economic growth in the US and abroad while helping improve the environment internationally," he said.
Unlike the others LNG projects approved this year -- Venture Global's Calcasieu Pass, Tellurian's proposed Driftwood LNG, and Sempra Energy-led Port Arthur LNG -- May 16's action entailed an add-on to an approved facility. FERC staff previously found the added Freeport train would not constitute a major federal action significantly affecting the environment.
The first Freeport three trains, currently under construction, are expected to have a capacity of 5 million mt/year each.
Michael Smith, CEO of Freeport LNG, said having FERC's approval in hand "brings us one significant step closer to our goal of moving ahead with Train 4 construction later this year."
Train 4 operations are anticipated to commence in 2023, the company said. The first train at Freeport is scheduled to begin commercial operations in Q3-19, the company said, adding the full three-train operation is expected by mid-2020. The project hit a delay caused in part by flooding following Hurricane Harvey in 2017.
A Freeport LNG spokeswoman said as recently as last month that the developer was continuing to try to commercialize a fourth train at the Texas facility.
In September 2018, a unit of Japan's Sumitomo reached a preliminary agreement that would make it Freeport LNG's first foundation customer for the fourth liquefaction train. The heads of agreement was for 2.2 million mt/year of LNG. To date, a firm deal has not been announced. Freeport LNG also has not disclosed any deals with other counterparties tied to the expansion plan.
The 3-1 approvals of projects this year have hinged on the inclusion of an estimate of direct GHG emissions associated with the terminals and a comparison of the emissions to a national net emissions inventory. The comparison was a compromise designed to win over LaFleur, a Democrat who acts as a swing vote on a commission currently split between two Republicans and two Democrats.
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