Three new LNG export projects have reached a final investment decision (FID) in the past year: Venture Global’s Plaquemines LNG, Cheniere’s Corpus Christi Phase III expansion and, most recently, Sempra’s Port Arthur LNG. What do these projects have in common? All are being developed by companies that are already exporting US LNG. These companies are arguably the “Big Three” of US LNG, with Cheniere the reigning king, at least for now. Not only do all have at least one terminal in operation and at least one under construction, but all three have multiple pre-FID projects under development, including some that are decently close to FID. With its proven track record and deep balance sheets, being one of the greats is a definite advantage when it comes to getting a project to the finish line. With a total of 43.5 MMtpa (5.8 Bcf/d) of capacity currently under construction and more than 100 MMtpa (13.4 Bcf/d) under development for these three, there’s even room for one more ? In today’s blog, we look at the pre-FID projects being developed by the Big Three, starting with Sempra.
With global energy markets recovering in 2021 and 2022, and Europe’s energy fallout from the Ukraine war, there is a new wave of interest in developing US LNG. After a deep lull and lack of progress due to oversupplied markets in 2019 and the COVID-19 pandemic in 2020, existing terminals are operating above contracted levels, new ones are announced projects and long-term capacity is being sold. Many projects have started to move forward and seem to be heading towards an FID, but so far, only the Big Three have been able to do so. RBN first addressed the dominance of these three companies in December (see We three Kings), by which time Venture Global had already taken FID in Plaquemines Phase 1, as had Cheniere in Corpus Christi Phase III. High interest rates, backward global prices and regulatory uncertainty (see Life in the fast lane for more information on recent rule changes) have dampened enthusiasm—or at least slowed progress—for many projects that had appeared near the IDF in the past year. But Cheniere, Venture Global and Sempra have continued to move forward with their projects and, in Cheniere’s case, have announced new ones, even as others’ projects have stalled. Since our December blog, Venture Global took FID in Plaquemines Phase 2 and Sempra in Port Arthur. Beyond these FIDs, each of these companies has also continued to move forward with its next round of projects.
Sempra currently has one operating terminal, Cameron LNG (solid purple diamond in Figure 1 below) in Louisiana. The three-train terminal can export 12 MMtpa (1.59 Bcf/d) of LNG. In addition to Cameron, Sempra currently has two FID projects under construction: Port Arthur LNG (striped orange diamond), the most recent US project to reach FID, and ECA LNG (striped blue diamond), the only project of US LNG that took FID. in 2020. The ECA LNG terminal will consist of a single 2.5 MMtpa (0.33 Bcf/d) train in Baja California on Mexico’s Pacific coast and is expected to begin producing LNG in 2025 This will be Mexico’s first LNG export terminal. , at least on land, as New Fortress Energy’s Altamira Floating LNG (FLNG) project is expected to come online later this year. ECA LNG is supported by toll agreements with TotalEnergies and Mitsui (see Figure 2 for details). Sempra’s next North American terminal will be Port Arthur LNG (for more information on Port Arthur see Jump in the Line, Part 5) in southeast Texas. Sempra took FID in Phase 1 of the terminal in March. The project will consist of two large trains with a combined capacity of 13.5 MMtpa (1.8 Bcf/d). It is expected to start producing LNG in 2027.
