US pipeline expansion that would feed Plaquemines LNG gets environmental nod - S&P Global

Houston — US regulators issued a positive environmental review March 16 for Columbia Gulf Transmission's East Lateral XPress project that would feed gas to Venture Global's proposed 20 million mt/year Plaquemines LNG terminal in Louisiana.

The development came as total gas deliveries to existing US liquefaction terminals rose to just shy of a record.

Moving in to summer, S&P Global Platts Analytics is forecasting that momentum to continue, with the global LNG market shifting from the shoulder season into growth mode. That will be highlighted by full dispatch economics out of the US, due in part to supportive summer prices on the back of a tighter than expected winter, with greater room available in European storages for injections.

Plaquemines LNG is the second of four liquefaction projects proposed by Venture Global, all in Louisiana. The first, Calcasieu Pass, is under construction and ahead of schedule, with the possibility of a startup of the 10 million mt/year facility as early as this fall. Plaquemines LNG and the two other projects, Delta LNG and CP2, have not yet been sanctioned.

Columbia Gulf's East Lateral XPress expansion would add 183,000 Dt/d of incremental gas transportation capacity. Combined with existing capacity, the project would allow for open access firm transportation service of up to 725,000 Dt/d on the East lateral.

The project would involve the construction of more than 8 miles of new 30-inch-diameter pipeline lateral within Barataria Bay. The lateral would connect Columbia Gulf's EL-300 pipeline in Jefferson Parish, Louisiana, to a new meter station in Plaquemines Parish. The meter station would interconnect with the Venture Global Gator Express pipeline, which would supply the Plaquemines LNG terminal.

In its Environmental Assessment, the Federal Energy Regulatory Commission said it determined the project would not significantly impact the environment, if it is built and operated within the framework of Columbia Gulf's application and follows mitigation measures recommended by agency staff, including limiting construction noise and visual impacts.

The EA did note, however, that the construction and operation of the project would increase atmospheric concentration of greenhouse gas emissions, in combination with past and future emissions from all other sources and would contribute incrementally to future climate change impacts.

According to the EA, the state of Louisiana established executive targets in 2020 to reduce net GHG emissions 26%-28% by 2025 and 40%-50% by 2030, compared with 2005 levels. Direct GHG emissions from the operation of the project's Centerville and Golden Meadow compressor stations would result in an annual increase in carbon emissions that represent 0.11% and 0.15% of Louisiana's 2025 and 2030 projected GHG emission levels, the EA concluded.

Besides the two new compressor stations, other components of the project include two new mainline valves, a tie-in facility, and launcher and receiver facilities. Gas would be delivered primarily from the pipeline system's Gulf Onshore Pool.

Developer activity

There are currently six major liquefaction facilities operating in the US. Calcasieu Pass, when it is completed, will be the seventh. An eighth, at the Qatar Petroleum- and ExxonMobil-backed Golden Pass terminal in Texas, is also under construction.

More than a dozen other developers are actively pursuing LNG export terminal projects in the US. Many have faced challenges reaching long-term contracts with buyers of their planned supplies. In recent months, however, commercial talks have started to pick up due to the volatility in prices in end-user markets in late 2020 and early 2021, according to several developers.

Feedgas demand at existing US terminals totaled 11.54 Bcf/d on March 16. The current record, set Dec. 13, 2020, is 11.58 Bcf/d, Platts Analytics data show.