Freeport LNG Development, L.P. is constructing a natural gas liquefaction and LNG export facility on Quintana Island near Freeport, Texas, about 70 miles south of Houston.
The company was founded back in 2002 with a different objective: to design, build and operate an LNG import and regasification terminal. When the facility was completed in June 2008, it featured two 160,000 cubic meter LNG storage tanks, an LNG vaporization system capable of delivering over 2 Bcf of gas a day into the domestic pipeline grid and a marine dock that could accommodate the largest LNG tankers in service. As part of the regasification system, Freeport LNG developed the environmentally friendly VE air tower that extracted heat from the air instead of burning natural ga for LNG regasification.
In 2005, when construction of the import terminal started, a major increase in U.S. LNG imports was projected due to what was then widely recognized as rapidly decreasing reserves of traditional gas. However, after June 2008, when the terminal was completed, the North American natural gas industry began experiencing a sea change—the shale gas revolution. Today, natural gas resource estimates by the DOE’s Energy Information Administration and private analysts indicate that the U.S. has sufficient natural gas supplies for more than one hundred years. By 2010, it was obvious that the U.S. gas market itself should become a source for LNG exports, without the danger of significantly impacting the price or availability of natural gas supplies to U.S. consumers. That was also the year when Freeport LNG launched its natural gas liquefaction and LNG export project.
After its completion in 2019, the three-train facility will produce and export some 15 mtpa of LNG, with production units starting sequentially between Q4 2018 (Train 1) and Q3 2019 (Train 3). In the meantime, Freeport LNG is planning to add a fourth liquefaction unit to the three already under construction. This expansion will allow for the export of an additional five million tons of LNG per year, increasing the total export capability of the project to over 20 mtpa of LNG.
Freeport LNG Milestones
Freeport LNG is founded to build the first LNG regasification terminal in the U.S. in over two decades.
FERC application to build an LNG import terminal is filed.
Dow executes a heads of agreement for a third of the regasification capacity.
ConocoPhillips executes agreements for other two-thirds of capacity, the financing of the construction and purchasing 50% of the General Partner.
FEED (Front End-Engineering Design) is concluded.
The Dow terminal use agreement is executed.
Definitive agreements with ConocoPhillips are executed.
FERC issues its final approval of the regas project.
Construction begins immediately after Freeport LNG receives permission from FERC to construct.
Freeport LNG applies with FERC for an expansion of the regas terminal..
A third terminal use agreement is executed with Mitsubishi for expansion volumes.
FERC approves the regasification terminal expansion.
Freeport LNG begins to drill an underground gas storage facility.
Testing and commissioning cargoes are delivered in April and May.
Regasification facilities enters commercial operations in June.
Freeport LNG is the first company to file with DOE to allow LNG to be imported, stored and then reexported.
First storage and reexport cargoes are processed for ConocoPhillips.
Presentation to Freeport LNG board launches the development of the liquefaction project.
Underground storage cavern begins operations.
DOE approves LNG exports equivalent to 511 Bcf/year of gas to Free Trade Agreement countries.
Formal FERC pre-NEPA (National Environmental Policy Act) process for liquefaction begins.
DOE approves the second export license for FTA countries for additional 511 Bcf/year.
A 4.4 mtpa liquefaction tolling agreement (LTA) with Osaka Gas and Chubu Electric is executed.
Formal application to construct three liquefaction trains is filed with FERC.
Freeport LNG executes a second 4.4 mtpa LTA with BP Energy.
DOE grants authorization to Freeport LNG to export 656 Bcf/year of gas to non-FTA countries.
Freeport LNG executes two 2.2 mtpa LTAs with Toshiba and SK E&S, respectively.
FEED basis for facility design is completed.
Train 1 and 2 EPC contract is executed with the CB&I/Zachry joint venture.
FERC releases the final Environment Impact Statement and approves the liquefaction project.
Financing for Trains 1 and 2 is closed and Freeport LNG gives notice to proceed to the CB&I/Zachary joint venture to commence construction.
Freeport LNG closes financing and releases CB&I/Zachry, now also joined by Chiyoda, to begin construction of Train 3.
Prefiling request with FERC for Train 4 is submitted and preparations for filing formal application commence.
Project Completion Timeline
Train 1 construction is completed and commercial start-up commences.
Train 2 and 3 construction is completed.