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Sempra's Costa Azul Gets World's First FID of 2020

Copyright © 2021 Energy Intelligence Group

It looked as though 2020 would pass without a single LNG export project anywhere in the world taking a final investment decision (FID) -- until Sempra Energy last week green-lighted its $2 billion Energia Costa Azul terminal in Mexico’s Baja California. The decision – which could provide an outlet for stranded gas reserves in parts of the US – came after Mexican President Andres Manuel Lopez Obrador announced that he would grant an export license for the plant with the condition that Sempra partially supply the terminal with the region’s gas (NGW Nov.16'20). The 3.25 million ton per year (445 million cubic foot per day) terminal “would be the first LNG export facility on the Pacific Coast of North America that can help connect abundant natural gas supplies from Texas and the western US directly to markets in Mexico and countries across the Pacific Basin,” Sempra LNG CEO Justin Bird said Nov. 17. Neither Sempra nor the Mexican government has said how much local gas would feed the terminal and how much would come from US sources such as the Rockies or the Permian Basin. One group that has a keen interest in how that plays out is the Western State and Tribal Nations (WSTN). The alliance is seeking markets for gas in its member states, tribal lands and counties and sees Costa Azul as an outlet. The WSTN is also supporting the Jordan Cove LNG project in Coos Bay, Oregon, a project that has been left beached due to ongoing regulatory and legal hurdles (NGW Oct.19'20). “As the only LNG export project in the world to reach FID in 2020, we see this announcement as an important step towards helping our Asian allies bolster their energy security and meet shared environmental priorities,” WSTN President Andrew Browning told Energy Intelligence.

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