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LatAmOil COMMENTARY LatAmOil

The export terminal will be built on the site of an existing import facility (Photo: ECA LNG)

Finally, an FID for ECA LNG

Sempra’s joint venture with its Mexican subsidiary IEnova has become the first

party to push an LNG export project to the FID stage since the beginning of 2020

US-BASED Sempra Energy and its Mexican likely to amount to $2bn, the company added.
subsidiary IEnova have become the first – and, It said ECA LNG was due to begin commercial
WHAT: thus far, the only – investors to make a final production in late 2024.
The ECA LNG venture has investment decision (FID) on an LNG export
decided to proceed with project since the beginning of 2020. Pandemic and permits
work on a new LNG export Sempra announced the FID in a statement The joint venture’s FID is a notable event for sev-
facility. dated November 17, saying that ECA Lique- eral reasons.
faction (ECA LNG), its joint venture with IEn- First, it marks the first time since the begin-
WHY: ova, had taken this step. The FID will allow the ning of the year that investors have taken a
The decision follows venture to move ahead with the development, chance on a large-scale LNG export project.
several quid pro quo pro- construction and operation of the Energía Costa Many other companies have opted instead to
posals from the Mexican Azul LNG facility near Ensenada in Baja Cali- delay FID in light of the drop in global energy
government. fornia State, it explained. consumption and prices that has followed the
The new natural gas liquefaction plant and coronavirus (COVID-19) pandemic.
WHAT NEXT: export terminal will be built at the site of an Second, it comes after nearly a year of wait-
Sempra is not the only existing LNG import facility. Sempra said in ing for the Mexican government to grant the
company hoping to make its statement that the LNG plant would have a last permit needed in advance of the FID.
Mexico’s Pacific coast
a point of origin for LNG single production train with a design capacity Mexico City has repeatedly floated the idea of
shipments to Asia. of 3.25mn tonnes per year and an initial off-take making issuance of the permit conditional on
capacity of around 2.5mn tpy. Capacity could ECA LNG’s willingness to perform other tasks.
then rise later, if the parties decide to build Earlier this year, for example, it indicated that
another train in the second phase of the project. it might insist that Sempra and IEnova build
The cost of establishing the first phase of the another LNG export facility in Topolobampo, a
gas liquefaction plant and export terminal is city in Sinaloa State, in exchange for the permit.

P4 www. NEWSBASE .com Week 46 19•November•2020