TOKYO, Sept 10 Freeport LNG expects to take the
final investment decision on its third processing unit at its
liquefied natural gas (LNG) project in Texas near the end of
2014, the head of the company told Reuters on Tuesday.
The Houston-based firm signed separate liquefaction tolling
contracts on Monday with Japan's Toshiba Corp and South
Korea's SK E&S for the plant's third production unit, or train,
to freeze natural gas for shipping.
The processing capacity from the first two trains has
already been contracted to Britain's BP and Japanese
utilities Osaka Gas Co and Chubu Electric Power Co
. The final investment decision on the first two trains
is expected in the first quarter of next year.
"We're on the schedule for a final EIS (Environment Impact
Statement) on Dec. 27 ... which will allow us to get approved in
January, February and start construction in March," CEO Michael
Smith said on the sidelines of an LNG conference in Tokyo,
speaking of the construction plans for the first two trains.
Asian and European companies have been queuing up to import
U.S. natural gas, supplies of which are at record highs thanks
to horizontal drilling and hydraulic fracturing that have
unlocked vast reserves of the fuel from shale rock formations,
pushing U.S. prices far below global levels.
LNG prices in Asia at the same time have risen since the
Fukushima disaster in March 2011 closed most of Japan's large
fleet of nuclear power stations and left the country scrambling
for substitute fuel for power generation.
Cheap U.S. gas has attracted other Japanese companies, as
well as firms in India and Europe, that have agreed to buy LNG
from other proposed export plants in the United States.
The U.S. Department of Energy granted the Freeport LNG
project, just south of Houston, Texas, conditional authority in
May to export at a rate of up to 1.4 billion cubic feet of
natural gas a day (Bcf/d) for a period of 20 years.
That would be equivalent to more than 10 million tonnes of
LNG a year, and would cover the project's first two trains, each
with an annual capacity of 4.4 million tonnes.
Freeport is still waiting for a construction permit for the
first two trains from the Federal Energy Regulatory Commission,
which the company expects will be granted in the first three
months of next year.
First exports are targeted for early 2018. The third train -
also with a capacity of 4.4 million tonnes a year - is expected
to come online near the end of 2018.