February 28, 2019 / 6:36 PM / 4 months ago

Cheniere gets U.S. OK to start work on Oklahoma Midship natgas pipeline

(Reuters) - U.S. energy regulators said this week that they have given Cheniere Energy Inc approval to build all of the company’s roughly $1 billion proposed Midship natural gas pipeline in Oklahoma.

In December, the U.S. Federal Energy Regulatory Commission authorized Midship to build the first 186 miles (299 kilometers) of the mainline pipe and associated infrastructure.

FERC approved construction of other parts of the pipe in January and on Wednesday approved work on the remaining roughly 13 miles of mainline pipe.

Cheniere, the nation’s biggest LNG exporter and biggest consumer of gas, said it expects to complete the project in 2019. It has said it has already started limited work on the project.

Midship is designed to deliver 1.44 billion cubic feet per day (bcfd) of gas from the Anadarko basin to existing pipelines near Bennington, Oklahoma, for transport to U.S. Gulf Coast and Southeast markets, where demand for the fuel for domestic consumption and liquefied natural gas (LNG) export is growing.

One billion cubic feet of gas is enough to fuel about five million U.S. homes for a day.

Total U.S. LNG export capacity is expected to rise to 8.9 bcfd by the end of 2019 and 10.3 bcfd by the end of 2020 from the current 5.1 bcfd level. That should make the country the third-biggest LNG exporter by capacity in 2019.

Most of the U.S. LNG export terminals, including Cheniere’s Sabine Pass in Louisiana and Corpus Christi in Texas, are located or being built along the Gulf of Mexico.

Last year, at least two U.S. production companies, Gulfport Energy Corp and Marathon Oil Corp, asked FERC to approve Cheniere’s request to build Midship because current gas infrastructure could not accommodate anticipated demand from the South-Central Oklahoma Oil Province (SCOOP) and the Sooner Trend Anadarko Basin Canadian and Kingfisher (STACK) plays in Oklahoma.

Reporting by Scott DiSavino; Editing by Bill Berkrot

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