Port Arthur 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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Port Arthur LNG Terminal is a proposed LNG export terminal in Texas, United States.

Location

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Phase I Project Details

  • Owner: Port Arthur LNG
  • Parent: Sempra LNG, Midstream, Woodside, Saudi Aramco
  • Location: Port Arthur, Texas, United States
  • Coordinates: 29.885, -93.94 (approximate)
  • Capacity: 11 million tonnes per annum[1]
  • Status: Proposed
  • Type: Export
  • Trains: 2[1]
  • Start Year: Expected 2023

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

Phase II Project Details

  • Owner: Port Arthur LNG
  • Parent: Sempra LNG, Midstream, Woodside, Saudi Aramco
  • Location: Port Arthur, Texas, United States
  • Coordinates: 29.885, -93.94 (approximate)
  • Capacity: 11 million tonnes per annum[2]
  • Status: Proposed
  • Type: Export
  • Trains: 2[2]
  • Start Year: Expected 2023

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

Background

Port Arthur LNG Terminal is a proposed LNG terminal in Texas, United States.[3] The proposed export facility received approval from the US Department of Energy to export LNG to Free Trade Agreement (FTA) countries in August of 2015.[4] The project expects to receive Federal Energy Regulatory Commission approval and Department of Energy non-FTA authorization in mid 2018, with operation in 2023.[5]

The original proposal was only for Phase I, which included 2 trains with a total of 11 million tonnes per year (mtpa) production capacity. Eventually, Phase II was proposed for an additional 2 trains and another 11 million tonnes per year (mtpa) production capacity. This brings the proposal to 4 trains with a total of 22 mtpa.[2]

In December 2018, Port Arthur LNG, LLC and the Polish Oil & Gas Company (PGNiG) announced they had agreed on a 20-year sale-and-purchase agreement for supply of LNG. The agreement is for the sale and purchase of 2 Mtpa, or approximately 2.7 billion cubic meters per year. Sempra Energy said this was enough natural gas to meet approximately 15% of Poland's daily needs. The agreement is dependent on Port Arthur LNG making a final investment decision.[6]

In April of 2019, the U.S. Federal Energy Regulatory Commission (FERC) approved the construction of Phase I of the Port Arthur Terminal.[7]

In May of 2019, Sempra Energy got approval to export LNG to countries that do not have a free-trade agreement with the U.S. The approval to export to non-free trade agreement countries is necessary for American LNG operators that want to tap into Asian markets.[8]

In June of 2019, Sempra Energy asked the Federal Energy Regulatory Commission (FERC) to approve a significant expansion of the associated pipeline that would boost the export capacity.[9]

Also in May of 2019, Saudi Aramco agreed to a buy a stake in Sempra Energy’s Port Arthur LNG export terminal, giving the world’s biggest oil exporter a foothold in the U.S. gas trade The proposed deal, which also includes an agreement to buy gas from the plant, would mark Aramco’s first entry into production of oil or gas outside Saudi Arabia. Aramco can potentially ship the LNG home to the kingdom’s power plants or trade it globally. The state-owned company and Sempra signed a preliminary agreement to acquire a 25% stake in the plant, but didn’t disclose the value of the potential deal.[10]

In March of 2020, Sempra Energy selected Bechtel for the engineering, procurement, and construction (EPC) of the Port Arthur LNG export terminal in Houston, Texas.[11] At the same time, the company pulled back from its previous intention to reach a final investment decision in the third quarter of 2020 owing to unfavourable LNG market conditions which have been exacerbated by the coronavirus pandemic.[12]

In April 2020, the Federal Energy Regulatory Commission (FERC) released its environmental review schedule for Phase II, and expects to issue its official Environmental Assessment on January 15, 2021. Other federal agencies with jurisdiction over the project will have until April 15, 2021 to complete their review.[13]

The final investment decision (FID) was originally expected in 2020, but in May 2020 Sempra announced that they were delaying the decision until 2021.[14]

In September 2020, Bloomberg reported that Saudi Aramco's mooted acquisition of a 25% stake in the Port Arthur project was under review by the company as it looked to cut back on its capital expenditure as a result of increasing pressure for it to deliver on its $75 billion annual dividend commitment to shareholders. It was reported that Saudi Aramco had withdrawn some staff members from the project.[15]

Articles and resources

References

  1. 1.0 1.1 Port Arthur LNG moves closer to FID with FERC authorization Oil and Gas Journal, Apr 18th, 2019
  2. 2.0 2.1 2.2 Sempra Energy and Saudi Aramco advance plans for Port Arthur LNG Hydrocarbon Technology, January 7, 2020
  3. About Port Arthur LNG, Port Arthur LNG, accessed May 2017
  4. Port Arthur LNG Facility, Texas, United States of America, Hydrocarbons Technology, accessed 17 June 2017
  5. About Port Arthur LNG: Project Schedule, Port Arthur LNG, accessed 17 June 2017
  6. Sempra Energy Subsidiary And Polish Oil & Gas Co. Sign Definitive Agreement To Export US LNG To Europe, Sempra Energy press release, Dec. 19, 2018
  7. U.S. FERC approves two new LNG export terminals in Texas and Louisiana Reuters, Apr. 18, 2019
  8. Marissa Luck,Sempra Energy's Port Arthur LNG hits another milestone Houston Chronicle, May 3, 2019
  9. Carl Surran,Sempra seeks pipeline expansion for Port Arthur LNG Seeking Alpha, June 24, 2019
  10. Anthony DiPaola,SLNG megadeal in works for Port Arthur terminal Beaumont Enterprise, May 22, 2019
  11. Charlie Bartlett, Sempra Energy and Bechtel team up on Port Arthur LNG project Dredging and Port Construction, March 26, 2020
  12. Scott DiSavino and Shradha Singh, Sempra confirms decision on Mexico LNG project, may delay decision on Texas plant Reuters, March 24, 2020
  13. FERC Releases Environmental Review Schedule for Port Arthur Expansion Lexology, April 20, 2020
  14. Final investment decision on Port Arthur LNG project in Texas delayed until 2021 S&P Global Platts, May 4, 2020
  15. Verity Ratcliffe, Anthony DiPaola, Matthew Martin, Aramco Shelves $20 Billion Petrochemical Plan After Oil’s Crash, Bloomberg, Sep. 3, 2020

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