DOE signs off on exports from Magnolia LNG project in Louisiana

The U.S. Department of Energy (DOE) will announce in Dec. 6 Federal Register its decision to issue to Magnolia LNG LLC final long-term, multi contract authorization to engage in the export of domestically produced liquefied natural gas (LNG) from the proposed Magnolia LNG facility located near Lake Charles, Calcasieu Parish, Louisiana, in a volume equivalent to 394.2 Bcf/yr (equal to 1.08 Bcf/day) of natural gas for a term of 25 years.

Magnolia LNG is seeking to export LNG from the terminal to countries with which the United States has not entered into a free trade agreement (FTA) that requires national treatment for trade in natural gas, and with which trade is not prohibited by U.S. law or policy (non-FTA countries).

DOE participated as a cooperating agency with the Federal Energy Regulatory Commission (FERC) in preparing an environmental impact statement (EIS) analyzing the potential environmental impacts resulting from the proposed LNG facility.

Magnolia LNG, with its principal place of business in Houston, Texas, proposes to construct liquefaction facilities in Lake Charles, Calcasieu Parish Louisiana. The Magnolia LNG Project will connect to the U.S. natural gas pipeline and transmission system through a proposed pipeline system modification and upgrade project (Lake Charles Expansion Project) to an interstate natural gas pipeline owned by Kinder Morgan Louisiana Pipeline LLC (KMLP).

In October 2013, Magnolia LNG filed the application with DOE/FE seeking authorization to export domestically produced LNG. Magnolia LNG proposes to export this LNG to non-FTA countries in a total volume equivalent to 394.2 billion cubic feet per year (Bcf/yr) of natural gas. Magnolia LNG has also submitted two applications to DOE/FE for authorizations to export LNG to FTA countries, each in the amount of 197.1 Bcf/yr (0.54 Bcf/day) for a 25-year term, for a combined total authorized FTA export volume of 394.2 Bcf/yr (1.08 Bcf/day). DOE/FE subsequently granted these FTA applications.

The authorized FTA export volumes are not additive to the export volumes requested in this proceeding. Therefore, DOE’s grant of the pending non-FTA export application in this proceeding will not provide Magnolia LNG with the authority to export more than 394.2Bcf/yr of natural gas from the Magnolia LNG Project.

In addition to its application to DOE/FE for export authority, in April 2014, Magnolia LNG submitted an applications to FERC for the siting, construction, and operation of the Magnolia LNG Project and, in June 2014, KMLP submitted an application for approval of the Lake Charles Expansion Project. FERC issued an order granting Magnolia LNG its requested authorization and KMLP its requested certificate of public convenience and necessity on April 15, 2016.

The Magnolia LNG Project will include a new liquefaction facility consisting of four liquefaction trains, two LNG storage tanks with a capacity of approximately 160,000 cubic meters each, a LNG vessel loading berth, and a LNG truck loading area. The Lake Charles Expansion Project will require varying lengths/diameters of new pipeline/pipeline facilities in Acadia, Calcasieu and Evangeline Parishes, Louisiana, to supply natural gas to the liquefaction facility from existing gas transmission pipelines. This pipeline project includes the construction of approximately 6,400 feet of 36-inch-diameter and 700 feet of 24-inch-diameter header pipelines in existing KMLP right-ofway along with one new compressor station.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.