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Cameron LNG Awards $6 Billion Construction Contract

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Sempra and its partners in the Cameron LNG liquefaction project have awarded a $6 billion contract to build liquefaction facilities at the Cameron LNG site in Hackberry, Louisiana, to a joint venture of CB&I and Chiyoda. The contract covers engineering, procurement and construction work for the addition of natural gas liquefaction and export facilities alongside Cameron LNG's existing regasification facility. The liquefaction complex will comprise three trains with a nameplate capacity of about 13.5 million tons per year of LNG (equivalent to about 1.8 Bcf/d of natural gas). CB&I -- founded as Chicago Bridge & Iron Co. -- has more than 50 years of experience in the LNG industry, while Chiyoda of Japan has been involved in the design and construction of plants that account for more than 40% of the world's total LNG production capacity. CB&I plans to set up a fabrication yard in Louisiana to build the liquefaction facilities and an engineering and project management office in the state capital of Baton Rouge. Subject to a final investment decision by Sempra and its partners, as well as finalization of permits and financing, Sempra will own a 50.2% stake in Cameron LNG, with the rest owned by GDF Suez and Mitsubishi. Cameron received conditional authorization from the US Department of Energy (DOE) in February to export domestically produced LNG to countries that do not have a free trade agreement (FTA) with the US (OD Feb.12'14). Federal law typically requires approval of natural gas exports to countries with which the US has a free-trade agreement. The DOE also typically will grant export authorizations to non-FTA projects as long as they are found to be in the "public interest." The lengthy review process for LNG export projects -- more than two years in some cases -- led the US House of Representatives Energy and Commerce Committee to issue a report in February calling for the approval of all LNG export licenses by the end of this year. Next up for review are the Jordan Cove LNG and Oregon LNG export projects in the US Pacific Northwest. Oregon LNG recently signed nonbinding memorandums of understanding for equity investment and capacity utilization with six Asian entities and one North American group for the two-train, 4.5 million ton/year project on the Columbia River in Oregon (OD Mar.5'14). Barbara Shook, Houston

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