Corpus Christi LNG Terminal

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Corpus Christi LNG Terminal is an export LNG terminal in Corpus Christi, Texas, United States. A Stage 3 expansion of the terminal is planned.

Location

The undated satellite photo below shows the LNG export terminal site located on the La Quinta Channel in San Patricio County. It is anticipated the terminal would be primarily supplied by reserves from the Eagle Ford Shale, located approximately sixty miles northwest of Corpus Christi, Texas.[1]

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Project Details, Stage 1

Project Details, Train 1

  • Owner: Corpus Christi Liquefaction[2]
  • Operator: Cheniere Energy[2]
  • Parent company: Cheniere Energy
  • Parent:
  • Location: Corpus Christi, Texas, United States
  • Coordinates: 27.913542, -97.286562 (exact)
  • Capacity: 5 mtpa[3]
  • Status: Operating
  • Type: Export
  • Trains: 1
  • Start Year: 2018[4]
  • Financing: A loan of US$8.4 billion was provided for construction of Trains 1 and 2 by a consortium comprising Korea Development Bank and 30 international private banks[5]

Note: mtpa = million tonnes per year; bcfd = billion cubic feet per day

Project Details, Train 2

  • Owner: Corpus Christi Liquefaction[2]
  • Operator: Cheniere Energy[2]
  • Parent company: Cheniere Energy
  • Location: Corpus Christi, Texas, United States
  • Coordinates: 27.913542, -97.286562 (exact)
  • Capacity: 5 mtpa[3]
  • Status: Operating[6]
  • Type: Export
  • Trains: 1
  • Start Year: 2019[6]

Note: mtpa = million tonnes per year; bcfd = billion cubic feet per day

Project Details, Stage 2

  • Owner: Corpus Christi Liquefaction[2]
  • Operator: Cheniere Energy[2]
  • Parent company: Cheniere Energy
  • Location: Corpus Christi, Texas, United States
  • Coordinates: 30.366324, -81.626135 (exact)
  • Capacity: 5 mtpa[3]
  • Status: Operating[7]
  • Type: Export
  • Trains: 1[8]
  • Start Year: 2020[2]
  • Financing: A loan of US$6.1 billion was provided for construction by a consortium comprising Korea Development Bank, 40 international private banks and undisclosed others[5]

Note: mtpa = million tonnes per year; bcfd = billion cubic feet per day

Project Details, Stage 3

  • Owner: Corpus Christi Liquefaction Stage 3, LLC[9]
  • Operator: Corpus Christi Liquefaction Stage 3, LLC[9]
  • Parent company: Cheniere Energy[10]
  • Location: Corpus Christi, Texas, United States
  • Coordinates: 30.366324, -81.626135 (exact)
  • Capacity: 11.5 mtpa (1.64 mtpa per train)[11]
  • Status: Proposed[12]
  • FID Status: FID (2022)[13]
  • Type: Export[11]
  • Trains: 7[4]
  • Cost: $8 billion[14]
  • Financing: US$4 billion Senior Secured Term Loan due 2029 and US$1.5 billion Working Capital Facility due 2027[13]
  • Start Year: 2024[12]

Background, Stage 1

Corpus Christi LNG was originally planned as an LNG Import Terminal and 23 miles of 48-inch pipeline, approved by FERC in April 2005.[15]

On December 16, 2011, Cheniere Energy, Inc. announced that its wholly owned subsidiary, Corpus Christi Liquefaction, LLC, was developing an LNG export terminal at the site, which was previously permitted for a regasification terminal. The proposed liquefaction project (Corpus Christi Project) is being designed for up to 13.5 million tonnes per annum (mtpa). Cheniere has initiated FERC's National Environmental Policy Act (NEPA) pre-filing review. The company plans for the first "trains," or facilities where gas will be liquefied, to be in operation in 2018.[1]

On March 25, 2013, UK energy company Centrica agreed to pay £10 billion (US$15 billion) over 20 years for 89 billion cubic feet of gas annually from Cheniere. The first deliveries, by tanker, are expected in 2018.[16]

Background, Stage 2

In February 2021 it was reported that Cheniere Energy had filed a request with the US Federal Energy Regulatory Commission (FERC) to place the third train at the Corpus Christi terminal project into commercial operation.[17] In March 2021, Cheniere disclosed that it had commissioned Train 3.[7]

Stage 2 Timeline

As of February 2020, the timeline had been updated to:[8]

  • August 31, 2012 – Filed FERC Application
  • October 8, 2014 – Issuance of Environmental Impact Statement
  • December 30, 2014 – Issuance of FERC order
  • December 31, 2014 – File Initial Implementation Plan
  • May 13, 2015 – Commence Construction on Trains 1 - 2
  • March 1, 2019 – Train 1 In Service
  • August 2019 – Train 2 In Service
  • 2021 – Train 3 Expected In Service

Background, Stage 3

Cheniere is also developing an expansion which would feature up to seven midscale Trains. The company expects to commence construction of the Corpus Christi Stage 3 project after entering into an engineering, procurement, and construction contract and additional commercial agreements, and obtaining adequate financing.[7]

In June 2018, an application had been filed with FERC to site, construct and operate the Midsize LNG Facilities. On March 29, 2019, FERC issued an Environmental Assessment for the project. Stage 3 received its FERC Order in November 2019. The first phase of the Stage 3 Project is expected to be brought online in 2024.[12]

In February 2020, the U.S. Department of Energy issued an approval for the Corpus Christi expansion project to ship LNG to nations that aren't part of free trade agreements, such as Japan, South Korea and India.[18]

In April 2020, the energy and shipping brokerage Poten & Partners disclosed that the final investment decision (FID) for the terminal expansion had been delayed beyond the original FID timing of 2022. It cited COVID-19, plunging demand and the crash in oil prices as the reasons for the delay.[19]

In June 2021, Cheniere made a sale and purchase agreement with the French utility Engie for 0.4-1.1 mtpa over 11 years, although it was not specified whether this volume would come from Corpus Christi Stage 3.[20]

By July 2021, Cheniere had made three, 15-year gas supply deals tied to the proposed Corpus Christi Stage 3 expansion with US gas producers Apache and EOG Resources and the Canadian oil and gas producer Tourmaline. Combined, the three integrated product marketing agreements represent a total of 2.55 mtpa of the facility's expected capacity of 10 mtpa.[21] Cheniere also reached a 6-year gas supply deal with New Fortress affiliate NFE North Trading for 0.6-1 mtpa to begin that year from the Corpus Christi facility.[22]

In September 2021, Cheniere announced that it expected to take a FID in 2022.[23] Anatol Feygin, Cheniere's chief commercial officer, expressed confidence that, due to soaring Asian spot LNG prices, potential customers would be more likely to enter into cheaper long-term contracts which Cheniere was offering. For the company to advance the Corpus Christi Stage 3 project, it believes it needs to reach a threshold of 4 mtpa in secured offtake agreements out of the expansion project's total capacity of 10 mtpa.[24]

In October 2021, a subsidiary of China's ENN Natural Gas signed a 13-year sales and purchase agreement with Cheniere Energy for 0.9 mtpa of LNG to be delivered on a free-on-board basis from July 2022, with the purchase price indexed to the US Henry Hub price. It was unclear from the companies' statements if the LNG supply would derive from Corpus Christi Stage 3, though Cheniere CEO Jack Fusco said the agreement marked another milestone in its commercial efforts "in anticipation of an FID of Corpus Christi Stage 3, which we expect will occur next year".[25] A further 13-year sales and purchase agreement between Swiss-based commodities trader Glencore and Cheniere Energy for 0.8 mtpa of LNG was announced in late October.[26] Again it was not specified if the deal would involve LNG being supplied from Corpus Christi Stage 3, though Cheniere's Fusco commented that the agreement "further builds upon Cheniere's commercial momentum, marking another important milestone in contracting our LNG capacity ahead of an FID of Corpus Christi Stage 3, which we expect to occur next year."[27]

In November 2021, Cheniere announced that it had entered a binding sales agreement with Sinochem Group Co., Ltd. for an initial volume of 0.9 mtpa which would increase to 1.8 mtpa over the course of the 17.5-year agreement, although it was not specified whether some of this volume would come from Corpus Christi Stage 3.[28] Cheniere also announced that it had entered a binding 20-year sales agreement with Foran Energy Group Co., Ltd., under which Foran will purchase 0.3 mtpa beginning in 2023, although again it was not specified whether some of this volume would come from Corpus Christi Stage 3.[29]

In December 2021, Cheniere requested that the Federal Energy Regulatory Commission (FERC) extend the amount of time it has to build the Stage 3 expansion. Cheniere's existing permit allows it until 2024 to complete the terminal, and the company has asked that FERC allow construction through 2027.[30]

In February 2022, Cheniere reached with supplier EOG to triple the amount of gas supplied under its previous agreement. With this contract in place, Cheniere announced that it had secured the remaining commercial support needed to advance its Stage 3 expansion.[31]

In May 2022, Cheniere announced a gas supply deal with a unit of Canada's ARC Resources, in which ARC Resources U.S. would provide the proposed Stage 3 expansion project with 140,000 MMBtu per day (1.5 bcm/y) of gas.[32] Cheniere also announced a sales and purchase agreement that month under which South Korea's POSCO would purchase 0.4 mtpa LNG for 20 years.[33]

In May 2022, Cheniere's request to FERC for an extension on the time it has to build Stage 3, submitted in December 2021, was approved by the agency. Cheniere has been granted until June 2027 to complete the project.[34]

In June 2022, Cheniere took a positive FID, indicating it will move forward with constructing Stage 3.[13] Cheniere also announced a sales and purchase agreement with Chevron under which it would purchase 2 mtpa from 2026 to 2042, and an agreement with Equinor under which it would purchase 1.75 mtpa for 15 years beginning in 2026.[35][36]

In July 2022, Cheniere announced a new sales and purchase agreement with PetroChina which will purchase 1.8 mtpa from the facility between 2026 and 2050. Whether PetroChina purchases half of the contractual amount depends on whether Cheniere expands the facility beyond Stage 3.[37] Cheniere also announced a sales and purchase agreement with a Thailand's PTT Global LNG Company Limited for 1 mtpa over 20-years, beginning in 2026 (although not explicitly tied to Corpus Christi Stage 3).[38]

Background, Additional Stages

In July 2022, Cheniere submitted applications for Texas Chapter 313 value limitation agreements to construct three additional expansions, which could include 6 to 24 trains each, and would be completed between 2037 and 2041.[39] As of July there has not yet been a public announcement around these expansions.

Articles and resources

References

  1. 1.0 1.1 "Cheniere plans Corpus Christi export terminal," LNG World News, Dec 16th, 2011.
  2. 2.0 2.1 2.2 2.3 2.4 2.5 2.6 International Group of Liquefied Natural Gas Importers (May 24, 2022). "Annual Report 2022 Edition" (PDF). GIIGNL. Retrieved July 11, 2022.
  3. 3.0 3.1 3.2 "GIIGNL 2021 Annual Report”, page 41, GIIGNL, accessed May 4, 2021.
  4. 4.0 4.1 2020 World LNG Report, page 102, International Gas Union, April 27, 2020
  5. 5.0 5.1 "Corpus Christi LNG - Trains 1 and 2," IJGlobal, accessed May 25, 2020
  6. 6.0 6.1 Cheniere starts LNG production from Corpus Christi Train 2 LNG World News, June 14, 2019
  7. 7.0 7.1 7.2 Adnan Bajic, Cheniere commissions Train 3 at Corpus Christi LNG, Offshore Energy, Mar. 29, 2021
  8. 8.0 8.1 "Project Schedule," Cheniere Energy, updated June, 2019
  9. 9.0 9.1 U.S. Liquefaction Capacity, Energy Information Administration. Accessed May 2022.
  10. "Bloomberg - Are you a robot?". www.bloomberg.com. Retrieved 2022-05-11.
  11. 11.0 11.1 U.S. Liquefaction Capacity, Energy Information Administration, November 3, 2020
  12. 12.0 12.1 12.2 Project Schedule Cheniere, accessed April 24, 2020
  13. 13.0 13.1 13.2 Cheniere to go ahead with Texas Corpus Stage 3 LNG export plant. Reuters. June 22, 2022.
  14. "Cheniere Energy authorizes expansion at Texas LNG export plant". Reuters. Retrieved 2022-11-08.
  15. "North American LNG Import Terminals: Status of Proposed and Existing Facilities," Natural Gas Intelligence, accessed April 2012.
  16. Fiona Harvey, "US shale gas to heat British homes within five years," guardian.co.uk, March 25, 2013.
  17. Two LNG export projects move forward in the United States, Enerdata, Feb. 15, 2021
  18. Four LNG projects along Texas coast land non-FTA export permits Houston Chronicle, Feb. 11, 2020
  19. John Snyder FID’s delayed by global uncertainty Riviera Maritime Media, Apr. 24, 2020
  20. Weber, Harry (2021-11-11). "Cheniere to supply LNG from Texas export facility under new deal with France's Engie". www.spglobal.com. Retrieved 2021-12-03.
  21. Harry Weber, Cheniere gas supply deal with Canada's Tourmaline lifts LNG expansion in Texas, S&P Global, Jul. 15, 2021
  22. Weber, Harry. Cheniere reached LNG supply deal with New Fortress affiliate over summer: DOE. S&P Global. December 14, 2021.
  23. Caroline Evans, Cheniere Eyes 2022 to Sanction Corpus Christi LNG Stage 3, Natural Gas Intelligence, Sep. 10, 2021
  24. Harry Weber, GASTECH 2021: Platts JKM surge said to be making spot LNG buyers rethink strategy, S&P Global, Sep. 22, 2021
  25. Harry Weber, China's ENN signs 13-year contract with Cheniere for 900,000 mt/year LNG, S&P Global, Oct. 11, 2021
  26. Marcy de Luna, Cheniere, Glencore reach 13-year LNG deal, Houston Chronicle, Oct. 25, 2021
  27. Cheniere and Glencore Sign Long-Term LNG Sale and Purchase Agreement, Cheniere Energy press release, Oct. 25, 2021
  28. "Cheniere and Sinochem Group Sign Long-Term LNG Sale and Purchase Agreement," Cheniere, November 5, 2021.
  29. "Cheniere and Foran Energy Group Sign Long-Term LNG Sale and Purchase Agreement," Cheniere, November 24, 2021.
  30. Disavino, Scott. Cheniere Asks for More Time to Build Texas Corpus LNG Expansion. Reuters. December 8, 2021.
  31. Weber, Harry (2022-02-24). "Cheniere secures remaining commercial support needed to advance US expansion". www.spglobal.com. Retrieved 2022-03-22.
  32. "Cheniere pens Corpus Christi deal with ARC Resources". LNG Prime. 2022-05-05. Retrieved 2022-05-10.
  33. "South Korea's POSCO to buy LNG supplies from US LNG exporter Cheniere: company". Retrieved 2022-09-01.
  34. "Cheniere gets more time to build Corpus Christi LNG expansion project". LNG Prime. 2022-05-10. Retrieved 2022-05-11.
  35. Chevron Taps Into LNG Boom With Cheniere, Venture Global Deals. U.S. News & World Report. June 22, 2022.
  36. Cheniere and Equinor Sign Long-Term LNG Sale and Purchase Agreement. Cheniere. June 9, 2022.
  37. "Cheniere Mulls Bigger Boost to Texas LNG Exports With China Deal - BNN Bloomberg". BNN. 2022-07-20. Retrieved 2022-07-20.
  38. "Cheniere and PTT Sign Long-Term LNG Sale and Purchase Agreement". Retrieved 2022-07-26.
  39. Corpus Christi LNG Terminal. Oil and Gas Watch. Accessed July 2022.

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