U.S. Exports First LNG from Sabine Pass

Sabine Pass

By MarEx 2016-02-24 22:48:46

The United States has exported its first LNG cargo from the lower 48 states, after a tanker set sail from Cheniere Energy's Sabine Pass export terminal in Louisiana.

The Asia Vision LNG tanker left the dock at the Sabine Pass terminal at 0139 GMT (7.39 p.m. local time) shipping data showed. The data indicated the tanker was fully loaded, and Cheniere says it is headed for Brazil.

Expected to become an importer of LNG just a decade ago, the shale gas revolution in the United States unlocked cheap, abundant gas supplies, allowing the country to become an exporter instead.

The first U.S. exports come just days before production begins at the Chevron Corp-led Gorgon LNG project in Australia, the world's most expensive LNG terminal at $54 billion, and will add to a wave of supply at a time when demand is faltering in major consuming countries and prices plummeting in line with oil.

The first cargo of about three billion cubic feet (bcf) of gas will go to Petrobras in Brazil, Meg Gentle, executive vice-president of marketing at Cheniere said on the sidelines of the CERAWeek conference in Houston.

U.S. Henry Hub natural gas prices for January fell to the lowest for the month since 1999 with near-record production of shale gas outpacing demand growth.

Spot LNG prices in Asia, where the bulk of LNG is consumed, were down about three-quarters from their peaks in 2014.

Cheniere Energy has six LNG vessels under charter, including the Asia Vision. The Energy Atlantic, another tanker chartered by Cheniere, has been waiting in the Gulf of Mexico since January and is also expected to transport LNG from Sabine Pass. 

Through its wholly-owned subsidiary, Sabine Pass LNG, L.P., Cheniere Partners owns 100 percent of the Sabine Pass LNG terminal located on the Sabine-Neches Waterway less than four miles from the Gulf Coast. The Sabine Pass LNG terminal includes existing infrastructure of five LNG storage tanks with capacity of approximately 16.9 billion cubic feet equivalent (Bcfe), two docks that can accommodate vessels with nominal capacity of up to 266,000 cubic meters and vaporizers with regasification capacity of approximately 4.0 Bcf/d. Through its wholly-owned subsidiary Cheniere Creole Trail Pipeline, L.P., Cheniere Partners also owns a 94-mile pipeline that interconnects the Sabine Pass LNG terminal with a number of large interstate pipelines.

Cheniere Partners, through its subsidiary, Sabine Pass Liquefaction, LLC, is developing and constructing natural gas liquefaction facilities at the Sabine Pass LNG terminal adjacent to the existing regasification facilities. The group plans to construct up to six liquefaction trains, which are in various stages of construction and development. Each liquefaction train is expected to have a nominal production capacity of approximately 4.5 million tonnes per annum (mtpa) of LNG.