In 2023, the U.S. exported 86 million tonnes per annum (mtpa) of LNG. Cheniere Energy expects the domestic market will be the first to surpass the 200 mtpa mark by 2040.

For the LNG and natural gas industry, the potential snag is the much-maligned decision by President Joe Biden to pause on approvals related to pending LNG projects.

But Cheniere executives, speaking during a Feb. 22 earnings webcast, are undaunted, although a prolonged delay in resuming approvals could halt planned expansions at the company’s Corpus Christi, Texas, facility, potentially keeping millions of tonnes of LNG off the market. The company’s current plans could add 33 mtpa of liquefaction capacity.

“We are confident that Cheniere will be able to navigate whatever comes out of the DOE and continue to prosecute expansions on our timeline,” Cheniere CCO Anatol Feygin said.

The company will deal with whatever comes from the Department of Energy’s review of the export permitting process, including its assessment of LNG’s effects on the climate. Feygin said the company looks forward to a methodical, science-based review.

“A lot of the things that we have been doing for the last four years or five years on our life-cycle assessment and on our environmental science and tracking the emissions profiles, providing the cargo emission tags, are all things that are new in the equation,” Feygin said. “And then, of course, just the quantum of LNG exports from the U.S. and gas dedicated to LNG exports is a new component in this equation.”

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Biden’s pause, announced in late January, calls for an assessment of LNG export deals with countries that do not have a free-trade agreement with the U.S., as countries with an agreement are already approved by current law. The order impacts all LNG export projects yet to receive approval.

Cheniere continues to view long-term LNG fundamentals as robust and supportive of approximately 200 mtpa of new capacity expected by 2040, the company said in its quarterly financials.

“While this decision does not currently impact our expansion projects or our FERC [Federal Energy Regulatory Commission] processes at Sabine Pass and Corpus Christi, it does introduce regulatory and permitting uncertainty into the U.S. LNG industry as a whole,” Cheniere President and CEO Jack Fusco said during the webcast.

“I firmly believe that a fair and transparent regulatory framework is essential for the future development of natural gas infrastructure in the U.S., particularly liquefaction capacity, given the scale of investment, commercial support and time required to bring these projects online,” Fusco said.

Corpus Christi expansion and FID

Cheniere is the U.S.’  largest LNG producer and the second largest LNG operator in the world. The company owns nine liquefaction trains across its two Gulf Coast plants—Corpus Christi and Sabine Pass—with a total production capacity of 45 mtpa. Cheniere said it will maintain those levels in 2024.

In Corpus Christi, Cheniere operates three liquefaction trains with a production capacity of 15 mtpa. Cheniere has produced and exported 870 cargoes from the facility, the company reported in its fourth-quarter 2023 financial statements.

Cheniere continues to move forward with its Stage 3 expansion to add seven midscale trains and more than 10 mtpa of new capacity. The company forecast 2024 capex of $1.5 billion to $2 billion for the expansion.

“We took some important steps last year in preparation for Stage 3 to commence commissioning and operations,” Fusco said. “Construction on the ADCC Pipeline being built from Agua Dulce to support Stage 3 is progressing well, and the pipeline is expected to be in service in the third quarter [of 2024] in advance of Train 1’s accelerated startup.”

Start-up of Train 1 is expected by year-end 2024, Fusco said.

Work related to Stage 3 is 51.4% complete, including engineering (83.7% complete), procurement (72.2%), subcontracting work (66.9%) and construction (11.1%), according to Cheniere.

In late 2023, Cheniere bought an existing 400-megawatt power plant in Corpus Christi for $100 million. When Stage 3 starts operations, the nearby power plant will help mitigate risks associated with increased power purchasing needs.

Cheniere is also developing two additional midscale trains, eight and nine, in Corpus Christi adjacent to Stage 3. Once completed, the two new trains will add 3 mtpa of capacity, bringing total production capacity in Corpus Christi to 28 mtpa. Cheniere has a DOE authorization to export LNG to free-trade agreement (FTA) countries and has already applied for authorization to export to non-FTA countries.

Cheniere is targeting a final investment decision (FID) related to Corpus Christi trains eight and nine in 2025.

“If DOE permitting prolongs longer than anticipated, LNG trains 8 & 9, currently scheduled for 2027 with annual revenue of $290 million, could face delays,” Tudor, Pickering, Holt & Co. said in a Feb. 7 research report.

Sabine Pass expansion and FID

In Sabine Pass, Cheniere operates six trains with a production capacity of 30 mtpa at its LNG facility in Cameron Parish, Louisiana. Cheniere has produced and exported 2,410 cargoes from the facility, according to company statements.

An expansion planned adjacent to this facility will add 20 mtpa, inclusive of debottlenecking opportunities, according to Cheniere.

Cheneire contracted Bechtel last year to execute the FEED contract for the expansion. Cheneire expects to file an application with FERC for authorization to site, construct and operate the expansion project by the end of the first-quarter 2024, the company said

Cheniere is targeting an FID related to the Sabine Pass expansion in 2026.

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