Then there is the catch-22 price dilemma. Due to a glut of US fracked gas it is at present dirt cheap (Henry Hub index) before expensive conversion to LNG and transport . But as LNG plants as well as pipelines to Mexico come on stream the price could shoot up and likely make exports unprofitable.
Another risk is cited in the inevitability of a fall in the extremely over valued financial markets, which might make the billions of dollars loaned to set up the facilities unpayable.
And finally there is the competition. The next LNG frack gas export facility at Cove Point, though relatively small scale, (a third the size of Sabine) is now in production and due to start exports in April 2018 .. and it is one of a dozen or more in development. see Cove Point LNG starts production
Federal safety regulators have instructed US LNG export player Cheniere Energy to remove from service two of five liquefied natural gas storage tanks at its Sabine Pass terminal following a gas leak last month.
Tank S-103 at the Sabine Pass plant in Louisiana released LNG on January 22 into the space between the inner and outer tank walls, which eventually caused cracks in the outer tank wall and the pooling of LNG in the secondary containment area surrounding the tank, according to an order by the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration.
Exposure of LNG to the carbon steel outer tank resulted in the cooling of the outer tank wall to a temperature far below its design temperature of-25° F and the formation of four separately-identifiable cracks. These cracks propagated to a length of approximately one to six feet in length in a short amount of time, the order dated February 8 said.After launching an investigation into the release, the PHMSA learned that Tank S102 had also previously experienced releases of LNG.“ This raises the possibility that the conditions which resulted in the incident may be present in multiple tanks,” PHMSA said.
LNG World News invited Cheniere for a comment regarding the incident. “Safety is Cheniere’s number one priority, and we want to stress that there was and is no immediate danger to our community, workforce, or our facility from this incident, nor is there any impact on LNG production,” Cheniere spokesman Eben Burnham-Snyder said. “Cheniere has initiated an event investigation and is currently working with experts on a repair plan. We will continue to work with PHMSA to quickly address this incident,” he added.
The Federal Energy Regulatory Commission said in a notice on February 9 that Sabine Pass must receive written authorization before placing the two tanks back into service. “Such authorization will only be granted following a determination that the storage tanks are fit for service,” the notice said.
The five tanks at Sabine Pass have about 3.4 billion cubic feet equivalent capacity, each. Cheniere’s Sabine Pass facility is the first liquefaction and export facility and currently the only such facility to ship U.S. shale gas overseas. There are four 0.6-Bcfd liquefaction trains operating at Sabine Pass, and a fifth is under construction and expected to enter service in mid-2019. Cheniere also plans to start its Corpus Christi plant next year”
Houston-based liquefied natural gas export player, Cheniere, saw a decrease in the number of cargoes of LNG exported from its Sabine Pass facility in Louisiana over the past week.
Currently, the only such a facility to export US shale gas overseas, loaded three LNG carriers with a total carrying capacity of 11.5 Bcf, during the week ending February 21. This compares to five LNG carriers shipped in the previous week, the data from the U.S. Energy Information Administration shows.
One tanker with an LNG-carrying capacity of 3.5 Bcf was loading at the terminal on Wednesday. Natural gas pipeline deliveries to the Sabine Pass terminal were down over the report week, averaging 2.2 Bcf/d, 1 Bcf/d or 33 percent lower than in the previous week. No tankers departed from Sabine Pass for most of the report week, February 14 – February 19.
To remind, on February 8, U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) instructed Cheniere to remove from service two of five LNG storage tanks at its Sabine Pass terminal following a gas leak last month. Despite the decline in loadings and the tanks being out of service, Cheniere does not expect the removal of the storage tanks from service to affect the export levels.
LNG World News Staff https://www.lngworldnews.com/
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