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Pieridae delays FID on Goldboro LNG
INVESTMENT
CANADA’S Pieridae Energy said last week that it had decided to delay a final investment decision (FID) on its proposed Goldboro LNG terminal in Nova Scotia until after September 30. The company had previously been aiming to reach FID in the third quarter of this year, but it said that market conditions and the fallout from the coronavirus (COVID-19) pandemic had forced it adjust its schedule.
Pieridae is aiming to bring the CAD10bn ($7bn) project into service between November 2024 and May 2025. While the company did not announce any adjustments to the start-up sched- ule, construction is anticipated to take around 56 months, and a delay in reaching FID will also likely push back the in-service date.
“Work continues on multiple fronts with our Goldboro LNG Facility, primarily with KBR to finalise a fixed price contract to design and build the facility,” Pieridae’s CEO, Alfred Sorensen, said in a statement. “Market conditions and the global fallout from COVID-19 have impacted our ability to make a final investment decision [FID] this fall but we are confident it will happen once conditions improve and we can better ana- lyse the landscape.”
The project will be located on Canada’s East Coast in order to target European markets. Pieri- dae has a 20-year agreement to sell 5mn tonnes per year (tpy) of LNG – all of the LNG from the first liquefaction train at the facility – to German utility Uniper. The company said it was negoti- ating with Uniper to extend the FID deadline to June 2021, adding that it expected to obtain the extension.
The Goldboro facility will also have a sec- ond train that will also produce around 5mn tpy. Sorensen said the company was con- tinuing to lobby the federal and provincial governments for financial help to build the terminal.
“There is no doubt there is a significant over- supply of LNG in the marketplace today, but our primary customer, Uniper, remains very com- mitted to our project,” Sorensen said on a con- ference call last week. “We are building for the future, not for the current economic situation,” he added.
Indeed, Pieridae is hopeful that other LNG projects around the world will be delayed or can- celled this year, leading to less competition when Goldboro starts up.
Sempra introduces feed gas to third Cameron LNG train
PROJECTS & COMPANIES
SEMPRA LNG, a subsidiary of US-based Sempra Energy, announced on April 22 that it had started introducing pipeline feed gas to the third liquefaction train at its Cameron LNG project on the Louisiana Gulf Coast. This marks the start of the final commissioning stage for Phase 1 of the three-train project, the company noted.
Feed gas deliveries to the third train are being ramped up after Sempra received authorisation from the US Federal Energy Regulatory Com- mission (FERC) to introduce the gas. Commer- cial operation of Train 3 remains on track to begin in the third quarter of 2020, the company said.
The three trains that comprise Phase 1 of the project have a combined capacity of 12mn tonnes per year (tpy) of LNG, or around 1.7bn cubic feet (48mn cubic metres) per day. Sempra experienced some delays in initially bringing the facility online, partly in relation to Hurricane Harvey, which hit the Gulf Coast in 2017. Train 1 entered commercial service in August 2019, with Train 2 following in March 2020.
A second phase of development at Cameron LNG has been proposed, comprising two addi- tional trains, but given collapsing demand and global oversupply, it appears unlikely that Sem- pra will pursue the second phase anytime soon. The company recently announced that it was delaying a final investment decision (FID) on its proposed Costa Azul LNG project in Mexico by a quarter, to the second quarter of 2020. The firm is also no longer committing to a third-quarter FID on its Port Arthur LNG project in Texas, having previously been targeting that quarter for a decision.
“The current economic environment may impact the schedule,” Sempra LNG’s president, Justin Bird, said on a conference call in late March. However, he added that the company remained confident in long-term demand for LNG and had commitments for about 70% of Port Arthur’s output.
Sempra Energy indirectly owns 50.2% of Cameron LNG. The company’s share of full-year run-rate earnings from Phase 1 is anticipated to be $400-450mn per year starting in 2021.
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