* FERC expected to approve Cheniere plant in Louisiana
* First US liquid natural gas export facility in 50 yrs
* International prices seven times higher
NEW YORK, April 13 U.S. regulators will vote
next week on Cheniere Energy Inc's proposed liquefied natural
gas (LNG) export plant at Sabine Pass in Louisiana. It would be
the first U.S. facility of its kind in the United States in
nearly 50 years.
The Federal Energy Regulatory Commission (FERC) will decide
whether to approve construction of the project in its monthly
meeting on April 19, according to the commission's website,
potentially providing the last approval needed for work to
Cheniere, which aims to start sending natural gas
abroad by 2015 pending a FERC environmental review, already has
government approval to do so.
Sabine Pass LNG would be built on the same site as
Cheniere's existing LNG import plant, which analysts say
increases the company's chances of getting the FERC go-ahead.
"We expect the project to be approved, with conditions,"
said Baird Equity Research analysts in a note on Friday. "We
don't know whether any conditions would constitute a requirement
that could potentially delay the start of construction."
FERC's decision is being watched closely by U.S. natural gas
producers and consumers as they debate the benefits and
drawbacks of shipping an abundant domestic resource overseas.
A number of other U.S. projects have also been proposed to
export LNG (natural gas cooled to a liquid for shipping) to
international markets where prices are more than seven times
higher than at home. Only Cheniere has government approval to
export LNG globally.
U.S. natural gas production has rocketed in recent years
because of new technologies that have allowed drillers to tap
vast shale deposits dotted across the country. Once expected to
be a major importer, the United States now has decades of
Surging natural gas production has swamped the U.S. market
this year, pressuring prices to 10-year lows that have crimped
profits for drillers.
Consumer critics are concerned that export will push
domestic prices higher. The U.S. government said in January that
exporting natural gas could add between 3 and 9 percent a year
to prices over the next two decades.