Plaquemines LNG Terminal

From Global Energy Monitor
This article is part of the Global Fossil Infrastructure Tracker, a project of Global Energy Monitor.
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Plaquemines LNG Terminal is a proposed LNG terminal in Louisiana, United States. The project's sponsor Venture Global reached a final investment decision (FID) for Phase 1 in May 2022.[1]

Location

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Project Details

Phase 1 (Trains 1–18)

  • Owner: Venture Global Plaquemines LNG, LLC[2]
  • Operator: Venture Global LNG, LLC[3]
  • Parent Company: Venture Global LNG[2]
  • Location: Plaquemines Parish, Louisiana, United States
  • Coordinates: 29.600411, -89.886404 (exact)
  • Type: Export[4]
  • Trains: 18 trains (2 trains per block, and 9 blocks per phase)[4]
  • Capacity: 13.33 mtpa (0.74 mtpa per train)[1]
  • Cost: US$13.2 billion (Phase 1)[1]
  • Financing: Initial US$500 million loan from Bank of America, JPMorgan Chase, Mizuho and Morgan Stanley (Phases 1 and 2)[5]
  • Status: Proposed, FID[1]
  • Start Year: 2024[6]
  • Associated Infrastructure: Gator Express Gas Pipeline[7]

Phase 2 (Trains 19–36)

  • Owner: Venture Global Plaquemines LNG, LLC[2]
  • Operator: Venture Global LNG, LLC[3]
  • Parent Company: Venture Global LNG[2]
  • Location: Plaquemines Parish, Louisiana, United States
  • Coordinates: 29.600411, -89.886404 (exact)
  • Type: Export[4]
  • Trains: 18 trains (2 trains per block, and 9 blocks per phase)[4]
  • Capacity: 10 mtpa (0.56 mtpa per train)[8]
  • Financing: Initial US$500 million loan from Bank of America, JPMorgan Chase, Mizuho and Morgan Stanley (Phases 1 and 2)[5]
  • Status: Proposed, pre-FID[4]
  • FID: 2022[9]
  • Start Year: 2025[6]
  • Associated Infrastructure: Gator Express Gas Pipeline[7]

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

Background

Venture Global's Plaquemines LNG Terminal is a proposed LNG terminal in Louisiana, United States. The 632-acre site is located on the Mississippi River.[10]

Construction was expected to begin in 2018. The company is also proposing the construction of two natural gas pipelines to connect existing pipelines to the site, including the Gator Express Gas Pipeline.[7]

In July of 2017, the project received approval from the Department of Energy (DOE) to export LNG to Free Trade Agreement nations.[11] In October of 2019, the project received approval from the Department of Energy (DOE) to export up to 3.4 billion cubic feet per day (Bcf/d) to non-Free Trade Agreement nations.[12]

In September of 2019, the project received full Federal Energy Regulatory Commission (FERC) approval. FERC also approved the associated Gator Express Gas Pipeline system, which is intended to bring natural gas from existing pipelines to the new facility in Plaquemines Parish.[13]

In June of 2019, the company struck a deal with PGNiG to buy 2.5 million tons per annum (mtpa) of liquefied natural gas from the yet-to-be-built Plaquemines terminal, up from 1 mtpa in an earlier agreement, suggesting that the project is still proceeding.[14]

In April 2020, Venture Global Plaquemines LNG LLC and Electricite de France SA (EDF) entered into a 20-year sales and purchase agreement (SPA) for 1 mtpa. Under this agreement, EDF will purchase LNG on a free onboard basis for a 20-year term starting from the commercial operation date of the export facility.[15] The energy and shipping brokerage Poten & Partners also disclosed that the final investment decision (FID) for the terminal had been delayed beyond the original FID timing of 2020. It cited COVID-19, plunging demand and the crash in oil prices as the reasons for the delay.[16]

In February 2021, with the securing of initial project financing, Venture Global LNG said that it expected to reach FID by mid-2021, with construction also expected to start before the end of the year. Thereafter the first liquefaction unit would be expected to enter service in 2024 with the project projected to be fully operational in 2025.[6]

In September 2021, Venture Global and Poland's PGNiG amended their existing sales and purchase agreement and increased the volume of LNG purchased from Plaquemines LNG to 4 mtpa for 20 years on a free-on-board basis. Taken together with the 1 mtpa contract agreed with EDF in 2020, Plaquemines has half of its First Phase's 10 mtpa capacity under contract.[17] Although FID had not been reached, very initial construction activities were reported to have started at the project site also in September.[18]

In December 2021, Venture Global signed two gas export contracts with China's CNOOC Gas & Power Group Co, one of which for 2 mtpa over 20 years from Plaquemines LNG.[19]

In March 2022, Venture Global announced that Shell had signed a contract to purchase 2 mtpa LNG for 20 years from the Plaquemines facility.[20] Later that month Venture Global announced that New Fortress Energy had agreed to purchase 1 mtpa from the facility for 20 years.[21]

In May 2022, Venture Global announced two sales and purchase agreements. ExxonMobil LNG Asia Pacific agreed to purchase 1 mtpa of LNG for an unspecified, long-term duration,[22] and the Malaysian state-owned oil and gas company Petronas agreed to purchase 1 mtpa of LNG for 20 years.[23]

In May 2022, Venture Global announced that it would be taking FID on the first phase of the project after closing US$13.2 billion in financing from a syndicate of banks led by Bank of America, Goldman Sachs, ING, JP Morgan, Mizuho, Morgan Stanley and RBC.[1]

In June 2022, Venture Global announced a sales and purchase agreement with Chevron under which it will sell 2 mtpa split between Plaquemines LNG and its proposed CP2 LNG Terminal.[24] Venture Global also announced a deal with the German utility EnBW Energie Baden-Wuerttemberg AG, which will buy 1.5 mtpa for 20 years starting in 2026. Venture Global did not specify whether this supply will come from Plaquemines LNG or one of Venture Global's other projects.[25]

Carbon capture and storage facility

In May 2021, Venture Global LNG announced that it plans to capture and sequester carbon at both its Plaquemines LNG Terminal and Calcasieu Pass Terminal in Louisiana. This is part of a growing trend among energy firms to reduce greenhouse gas emissions to meet increased customer and government demand for cleaner energy to reduce damage caused by climate change. The carbon capture and storage (CCS) project would compress carbon dioxide at its sites and transport the gas to be permanently stored in subsurface saline aquifers. The company estimates that it will capture and sequester an estimated 500,000 tons of carbon per year from both Plaquemines and Calcasieu.[26] Commenting on the CCS project in June 2021, the company's CEO Michael Sabel said: "We don't need any new technology to do it. We don't need any additional outside funds to do it. We're able to do it as soon as the permitting process allows us to go forward."[27]

Financing

A US$500 million loan to partly pay for construction of the terminal was agreed with Bank of America, JPMorgan Chase, Mizuho and Morgan Stanley in February 2021.[5]

A bank syndicate led by Bank of America, Goldman Sachs, ING, JP Morgan, Mizuho, Morgan Stanley and RBC provided US$13.2 billion in financing to develop Phase 1 of the facility.[1]

Articles and resources

A June 2022 report on the potential impacts of Plaquemines LNG was published by the organizations Sierra Club and Healthy Gulf that urges the U.S. Federal Energy Regulatory Commission (FERC) agency to deny the facility's request to produce an additional 3.2 mtpa of fracked gas. The organizations argue that FERC must prepare a new Environmental Impact Statement (EIS) that fully analyzes the facility's potential impact on the environment, climate, and environmental justice communities during its construction.[28]

References

  1. 1.0 1.1 1.2 1.3 1.4 1.5 LNG, Venture Global. "VENTURE GLOBAL ANNOUNCES FINAL INVESTMENT DECISION AND FINANCIAL CLOSE FOR PLAQUEMINES LNG". www.prnewswire.com. Retrieved 2022-05-25.
  2. 2.0 2.1 2.2 2.3 "Plaquemines • Venture Global LNG". Venture Global LNG. Retrieved 2022-05-16.
  3. 3.0 3.1 U.S. Liquefaction Capacity. EIA. Accessed May 2022.
  4. 4.0 4.1 4.2 4.3 4.4 Plaquemines LNG Terminal Hydrocarbons Technology, accessed April 14, 2021
  5. 5.0 5.1 5.2 Venture Global gets loan for Louisiana Plaquemines LNG construction, Reuters, Feb. 11, 2021
  6. 6.0 6.1 6.2 Two LNG export projects move forward in the United States, Enerdata, Feb. 15, 2021
  7. 7.0 7.1 7.2 $8.5 billion natural gas project in Plaquemines Parish to create 250 jobs Nola.com, 22 December 2016
  8. U.S. Liquefaction Capacity, Energy Information Administration, November 3, 2020
  9. Venture Global to decide on Louisiana Plaquemines LNG phase 2 by year end. Reuters. May 26, 2022.
  10. Venture Global Plaquemines LNG, Plaquemines LNG, accessed May 2017
  11. Venture Global LNG, Plaquemines LNG Project, accessed July 2017
  12. Nick Blenkey, Plaquemines LNG export project gets DOE approval Marine Log, October 17, 2019
  13. Rachael Thomas, $8.5 billion natural gas liquefaction facility coming to Plaquemines Parish WAFB9, September 30, 2019
  14. Marissa Luck,Venture Global raises $675M more for LNG projects Houston Chronicle, June 28, 2019
  15. Venture Global Plaquemines LNG, EDF enter agreement BIC Magazine, April 20, 2020
  16. John Snyder FID’s delayed by global uncertainty Riviera Maritime Media, Apr. 24, 2020
  17. Venture Global LNG and PGNiG Finalize Expansion of LNG Partnership, Venture Global LNG press release, Sep. 2, 2021
  18. Claudia Carpenter, Harry Weber, GASTECH 2021: Venture Global LNG's Calcasieu Pass said to be nearing completion, S&P Global, Sep. 22, 2021
  19. Chapa, Sergio. "Venture Global Signs Another Pair of LNG Supply Deals With China." BNN Bloomberg. December 20, 2021.
  20. De Luna, Marcy. Venture Global says Shell to buy LNG from Louisiana Plaquemines plant. Reuters. March 7, 2022.
  21. LNG Global. Venture Global LNG Sales and Purchase Agreements with New Fortress Energy. March 16, 2022.
  22. "Venture Global inks long-term LNG sale and purchase deals with ExxonMobil". Offshore Energy. 2022-05-11. Retrieved 2022-05-11.
  23. "VENTURE GLOBAL AND PETRONAS ANNOUNCE SALES AND PURCHASE AGREEMENT • Venture Global LNG". Venture Global LNG. Retrieved 2022-05-11.
  24. Chevron Taps Into LNG Boom With Cheniere, Venture Global Deals. U.S. News & World Report. June 22, 2022.
  25. News, Bloomberg (2022-06-21). "German Utility Signs Long-Term Deal to Buy LNG From the US - BNN Bloomberg". BNN. Retrieved 2022-07-07.
  26. Venture Global Launches Carbon Capture and Sequestration Project, Venture Global LNG press release, May 27, 2021
  27. Scott DiSavino, Venture Global can build Louisiana carbon capture after getting permits, Reuters, Jun. 23, 2021
  28. "Safety and Environmental Review of Plaquemines LNG", Sierra Club and Healthy Gulf, Jun. 10, 2022

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