With all eyes are on U.S. LNG exports in the early part of this year, particularly Cheniere Energy Partners (LNG), this may be a good time to blink. Cheniere is expected to usher in the era of the U.S. as a global LNG player, just not as soon as it planned.

On Jan. 14, the company, which recently went through a major change of leadership, said that it expects to export the first LNG commissioning cargo in “late February or March,” a delay from previous announcements.

Cheniere had been expected to ship its first cargo from its Sabine Pass liquefaction project in Cameron Parish, La., by late January.

Construction for Train 1 was completed well ahead of the guaranteed contractual schedule and within budget. However, instrumentation issues were discovered during the final phases of plant commissioning and cool down that will require some additional work over the next few weeks, leading to the delay.

"With construction of Train 1 finished, we ... anticipate no issues in meeting all contractual targets and guaranteed completion dates,” said Neal Shear, interim president and CEO. “Additionally, construction for Trains 2 to 5 continues to be on an accelerated schedule, and these trains are expected to come online on a staggered basis. Bechtel will hand over care, custody and control of each train as they complete its scope of work."

Bechtel, the engineering, construction and project management firm working on the Sabine Pass project, said it has been “continually working towards completing the first unit and working through a few items that will provide assurance to Cheniere Partners that plant reliability and performance will be as expected.”

Those last few unspecified items are in final resolution, according to Bechtel.

Cheniere’s milestone of first cargo is expected to be a significant event around the world. The U.S. has long been considered a sleeping giant among global LNG players.

There has been 18.5 million metric tons per annum of LNG capacity sanctioned in the U.S., mostly by Cheniere. Its projects were all able to take sanction as a result of agreements signed in previous years before the fall in prices.

The company has entered into six third-party LNG sale and purchase agreements (SPAs) that in the aggregate equate to approximately 19.75million tons per annum (mtpa) of LNG and commence with the date of first commercial delivery of Trains 1 through 5 as specified in the respective SPAs.

Cheniere has SPAs with BG Group, Gas Natural Fenosa, KOGAS, GAIL (India) Ltd, Total and Centrica. BG Group holds the largest annual contract quantity guarantee at 286.5 MMBtu.

The Sabine Pass LNG terminal located on the Sabine-Neches Waterway less than four miles from the Gulf Coast includes existing infrastructure of five LNG storage tanks with capacity of approximately 16.9 billion cubic feet equivalent, two docks that can accommodate vessels with nominal capacity of up to 266,000 cubic meters and vaporizers with regasification capacity of approximately 4 billion cubic feet per day.

Cheniere Partners owns 100% of the terminal and is developing and constructing natural gas liquefaction facilities at the Sabine Pass LNG terminal adjacent to the existing regasification facilities. The company plans to construct over time up to six liquefaction trains, which are in various stages of development. Each liquefaction train is expected to have a nominal production capacity of approximately 4.5 mtpa of LNG.

Cheniere’s journey to first cargo has been bumpy at times. In December the company ousted long-time CEO and co-founder of Cheniere Charif Souki. At the time, analysts following Cheniere expressed surprise at the timing of Charif Souki’s departure from the company he built, but not at the outcome of the inevitable confrontation with Cheniere largest investor Carl Icahn given the conflicting outlooks of the two industrial titans.

For the first nine months of 2015, the company’s net loss was $684 million compared to a net loss of $389.3 million for the first nine months of 2014.

Len Vermillion can be reached at lvermillion@hartenergy.com.

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