LNG Supports U.S. Energy Dominance, Army Corps Says

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Written by Daniel Graeber for IIR News Intelligence (Sugar Land, Texas)

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Summary

Already under construction on the Gulf Coast of Texas, NextDecade secured early approval for expansion of its Rio Grande LNG export facility. Meanwhile, President Trump is touting a major investment in a similar project in Alaska.

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Army Corps Approves Another Train at Rio Grande

Backing an expansion to the Rio Grande export terminal for liquefied natural gas (LNG) helps ensure energy dominance from the United States, the U.S. Army Corps of Engineers said.

The Army Corps division in Galveston, Texas, awarded a permit to NextDecade for the sixth liquefaction unit, or train, at Rio Grande. Industrial Info Resources data show the facility would have a planned capacity of 5.9 million metric tons per annum of gas in the liquid form.

NextDecade is constructing the facility on a 984-acre site that will support production of LNG with feed gas from the Agua Dulce gas market hub, with access to the Permian and Eagle Ford shale basins. Industrial Info Resources data show commercial operations are slated to begin in the first quarter of next year.

"We're committed to working constructively with industry while maintaining the environmental safeguards and regulatory standards entrusted to us -- helping deliver the infrastructure needed to support national supply chains, energy dominance and long-term economic resilience along the Texas coast," said Col. David W. Dake, the district manager for the Army Corps in Galveston.

Work on an initial three trains at the plant was underway by 2024. It'll require several more permits from various agencies before it can begin commercial operations, however.

The United States is already the world leader in exports of LNG, and deliveries now are helping to offset some of the supply disruptions stemming from the conflict in the Middle East. The amount of feed gas running to Gulf Coast export terminals averaged 17.75 billion cubic feet per day (Bcf/d) over five days to Wednesday, about 10% above year-ago levels, according to the NATGAS Today report.

There are nine operational terminals along the U.S. Gulf Coast that are currently delivering LNG, with several others in the planning stages. Industrial Info Resources data show there are 132 active capital LNG projects in the U.S. market, with a total investment value of nearly $442 billion.

Trump Going Big on Alaska LNG

Eager to tap Asian markets, U.S. President Donald Trump has touted the potential for the Alaska LNG project. Japanese energy companies JERA and Tokyo Gas are among the major companies so far securing offtake from the project.

Glenfarne Group is the parent company. Data from Industrial Info Resources show that, if built, the terminal would have a peak design capacity of 500 million cubic feet of gas per day (MMSCFD).

On Tuesday, the Reuters news service reported the Trump administration was considering some $54 billion drawn from a strategic investment fund with South Korea to support the project. That's more the double the total investment value for the Sabine Pass terminal, the largest U.S. terminal by volume, data show.

Australian services company Worley will offer engineering, procurement and construction management (EPCM) services for Phase I development of the Alaska project, which would include a 739-mile, 42-inch pipeline that would be constructed in four sections, with potential tie-backs to existing midstream infrastructure.

It will be difficult to build a pipeline, however, given the construction window in Alaska is narrowed by a warming climate, as special infrastructure is needed when the ground thaws. Phase II would add on coastal infrastructure.

By the Numbers

• $54 billion possible in Alaska LNG investments
• $442 billion in total investment value in U.S. LNG sector

Key Takeaways

• NextDecade cleared for another liquefaction unit at Rio Grande facility.
• Investments slated for Alaska LNG would be far greater than Sabine Pass, the largest terminal by export volume.

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