Cheniere sanctions third LNG train for Corpus Christi

Cheniere Energy has made a final investment decision (FID) on the construction of a third liquefaction train at its LNG export terminal in Corpus Christi, Texas. Corpus Christi Train 3 is the first new LNG production project worldwide to be given the green light this year and the first FID for new US output since 2015.

Like the terminal’s first two trains, now under construction, Train 3 will have the capacity to produce up to 4.5 million tonnes per annum (mta) of LNG. Added to the five 4.5 mta trains the company is providing at its Sabine Pass terminal in neighbouring Louisiana, Cheniere Energy will boast a nameplate production capacity of 36 mta at its two US Gulf facilities when Corpus Christi Train 3 is completed in 2021.

Cheniere has concluded long-term supply deals with state-owned China National Petroleum Corp, Portugal’s EDP and commodity trader Trafigura covering an aggregate 2.97 mta, or 66%, of the Train 3 output. That volume was deemed adequate to support a FID on the liquefaction unit.

Of the new US LNG export projects underway and under construction, Corpus Christi is the first greenfield scheme. The others – Sabine Pass, Cove Point, Elba Island, Cameron LNG and Freeport LNG – have involved the construction of liquefaction trains at existing, largely idle LNG import terminals to give them a bidirectional capability.

To date, Sabine Pass and Cove Point are the only US liquefaction facilities in service. Cheniere Energy achieved a two-year jump on its rivals with Sabine Pass, where four trains are now in operation and a fifth is nearing completion. The facility loaded its first cargo in February 2016 and accounted for all of the 12.24M tonnes of LNG that the US shipped to world markets in 2017.

Cove Point despatched its first export cargo in March 2018 and later this year the first of Elba Island’s 10 modular, small-scale liquefaction units will be in service. Sabine Pass Train 5 is also due for commissioning this year, while the first trains at the Corpus Christi, Cameron and Freeport terminals will begin liquefying gas in 2019.

Looking ahead, Cheniere Energy has plans on the table for a sixth Sabine Pass train and additional liquefaction facilities at Corpus Christi. Originally, the next, Stage 3 Corpus Christi expansion phase called for the construction of Trains 4 and 5, each of 4.5 mta. However, the company has also been studying an alternative approach.

Rather than building two 4.5 mta trains, Cheniere now believes that seven 1.4 mta liquefaction units of modular design totaling 9.5 mta in capacity represent a better option. The smaller trains would eliminate the need for costly excavation and foundation work and provide the requisite export capacity more quickly than would be possible with larger processing units.

Also, the smaller output per train is expected to make it easier to line up prospective LNG buyers and enable construction to proceed on a train-by-train basis. While the energy company still supports the efficacy of traditional, large-scale liquefaction trains, it is keen to explore the small-to-mid-scale option to ensure the buildup of in-house expertise across the range of options.