Southern LNG Awards Contract, Prepares to Expand Terminal in Georgia

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Researched by Industrial Info Resources (Sugar Land, Texas)--Southern LNG Incorporated (Birmingham, Alabama) received its approval from the Federal Energy Regulatory Commission last week to begin initial site preparation on its Elba Island Expansion III Phase I. Southern LNG is a division of Southern Natural Gas Company, which is a subsidiary of El Paso Corporation (NYSE:EP) (Houston, Texas),

Southern LNG plans to expand its Elba Island Terminal by constructing a 200,000-cubic-meter single-capacity LNG storage tank with the capacity to hold 4.2 billion cubic feet (1.25 million barrels) of liquefied natural gas. The inner wall will be a 9% nickel steel tank, and the outer will be a carbon steel tank. The LNG will be contained in the inner wall, and the outer will contain the vapors. This will be the fifth tank at the 224.5-acre site, bringing the total storage capacity at the site to 11.2 billion cubic feet.

In addition to additional storage, Southern LNG will add LNG-vaporization capacity to handle the LNG and associated boil-off gas and allow for the emission of vaporized LNG. There will be three submerged combustion vaporizers, each with a peak capacity of 180 million cubic feet per day, along with one associated boil-off gas condenser and three boil-off gas compressors, resulting in an addition of 540 million-cubic-feet-per-day increase in capacity to the existing 1.2 billion cubic feet per day.

Southern LNG will also modify the slip and mooring arrangement to accommodate larger vessels. Currently, the terminal handles vessels from 125,000 cubic meters to 145,000 cubic meters. After construction is complete, the terminal will be able to handle future vessels capable of transporting up to 266,000 cubic meters of LNG. The berths will be lengthened, and about 72,000 cubic yards of material will need to be dredged from the slip. One of the existing 16-inch-diameter unloading arms will be relocated from the existing river dock and join the three arms at the north dock. The north dock will be reconfigured to handle the simultaneous unloading of two vessels. The river dock will no longer be used for LNG shipments after the expansion. With the modifications to the marine facilities, Southern LNG expects to increase deliveries from handling an average of 58 LNG cargos per year to more than 150.

Chicago Bridge & Iron (NYSE:CBI) (The Woodlands, Texas) has been awarded the contract to handle engineering and construction for the project, which carries an estimated capital value of $300 million. Site preparation is scheduled to begin immediately, and the terminal expansion is expected to go into service in June 2010.

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