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Tellurian plans to start building Louisiana LNG export plant in 2019

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Reuters are reporting that Tellurian Inc says it remains on track to begin construction of its Driftwood LNG export terminal in Louisiana in the first half of 2019 and begin operations in 2023.

Tellurian is on schedule to announce its partners in the US$27.5 billion project in the third or fourth quarter, Tellurian President and CEO Meg Gentle said in the company’s second-quarter earnings release.

Driftwood is one of more than two dozen LNG export projects under development in the US and seeking customers so they can start construction and enter service in the next decade.

US LNG exports have almost quadrupled from 183.9 billion ft3 of natural gas in 2016 to 706.4 billion ft3 in 2017, worth about US$3.3 billion, and are on track to rise to over 1000 billion ft3 in 2018, making the country one of the world’s biggest exporters of the super-cooled form of natural gas.

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

Tellurian said it has about 25 customers interested in partnering with and buying gas from the project.

The company estimated the US Federal Energy Regulatory Commission (FERC) will approve construction of Driftwood in January 2019, enabling Tellurian to make a final investment decision to build the project in the first half of 2019.

Tellurian also said it closed open seasons on two proposed pipelines – Permian Global Access and Haynesville Global Access – that are designed to transport gas from shale formations in Texas and Louisiana to LNG terminals and other Gulf Coast customers.

Interest in both pipelines exceeded available capacity, the company said.

Unlike most other proposed US LNG export projects that will liquefy gas for a fee, Tellurian is offering customers the opportunity to meet their gas needs by investing in a full range of services from production to pipelines and liquefaction.

Current partners include Total SA, General Electric Co and Bechtel, which has a US$15.2 billion contract to build the liquefaction facility at the centre of the project. Pipelines, reserves and other costs make up the rest of the US$27.5 billion price tag of the project.

Driftwood will have capacity to produce 27.6 million tpy of LNG or about 4 billion ft3 per day of gas.

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