DOE Grants G2 LNG Authority to Export to Countries with U.S. Free Trade Agreements

The U.S. Department of Energy Office of Fossil Energy (DOE-FE) recently granted G2 LNG long-term, multi-contract authorization to export LNG to any country with which the U.S. has a free trade agreement.

In a July 17 order, DOE-FE approved G2 LNG’s March 19 application to export LNG produced from domestic sources in a volume equivalent to approximately 672 billion standard cubic feet per year (Bcf/yr) of natural gas (1.84 Bcf per day (Bcf/d). G2 LNG plans to export the LNG by vessel from its proposed natural gas liquefaction terminal to be built on a 500-acre site along the Calcasieu Ship Channel in Cameron Parish, La.

DOE-FE authorized G2 LNG to export to Australia, Bahrain, Canada, Chile, Colombia, Dominican Republic, El Salvador, Guatemala, Honduras, Jordan, Mexico, Morocco, Nicaragua, Oman, Panama, Peru, Republic of Korea, and Singapore, as well as to any nation with which the U.S. subsequently enters into a free trade agreement.

On March 19, G2 LNG also filed an application with DOE-FE for authority to export LNG to countries that do not hold a free trade agreement with the U.S. In a July 24 notice in the Federal Register, DOE-FE said it is in the process of reviewing that application, and invited public comment.

G2 LNG’s liquefaction project for the export of LNG in an amount up to 672 Bcf/yr will have 14 million metric tons per annum liquefaction capacity. The project will include two LNG trains, LNG storage tanks with approximately 10 days of storage, and vessel loading facilities.

Natural gas will be received by pipeline at the liquefaction facility, where it will be liquefied, stored and loaded from storage tanks to LNG carriers at the terminal. G2 LNG already has secured the land for the facility in Cameron Parish, and the company plans to submit an application to FERC for approval to build the project.

According to G2 LNG’s application to DOE-FE, the company plans to use its export authorization on its own behalf and as an agent for other entities holding title to the LNG at the time of export. G2 LNG said that, as the liquefaction project development proceeds, it expects to enter into a variety of natural gas supply arrangement that will result in a mix of long-term and spot market agreements.

G2 LNG expects to begin delivery by early 2020.

In its order, DOE-FE directed G2 LNG to file with the Office of Oil and Gas Global Security, on a semi-annual basis, written reports describing the progress of the liquefaction project in Cameron Parish. The reports are due on April 1 and October 1 of each year, and must include information on the progress of the project, the date the facility is expected to be operational, the status of the long- term contracts associated with the port of LNG, and any long-term supply contracts associated with DOE-FE’s authorization to export.

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