Feds approve expansion of Cheniere LNG terminal

The Federal Energy Regulatory Commission has given Houston-based Cheniere Energy Inc. the go-ahead to nearly double the capacity of its Sabine Pass liquefied natural gas receiving terminal, which is under construction in Cameron Parish. In July 2005, Sabine Pass LNG LP applied to FERC seeking authorization

FERC concluded expanding the terminal would not significantly affect the quality of the human environment. Sabine Pass LNG LP received FERC's authorization for Phase One of its Cameron Parish receiving terminal in December 2004 and began construction in March 2005. Start-up of Phase One is targeted for early 2008 and Phase Two in 2009. Phase One of the Sabine Pass LNG receiving terminal is designed with regasification capacity of 2.6 billion cubic feet per day, two unloading docks and three storage tanks capable of holding 10 billion cubic feet of LNG.

The Phase Two expansion calls for construction of three additional tanks with another 10 billion cubic feet of storage and 1.4 billion cubic feet per day of additional regasification capacity. The project's capacity holders are:

* Total LNG USA Inc., a subsidiary of Courbevoie, France-based oil company Total S.A., with a reservation of 1 bcf per day for 20 years,

* Chevron USA Inc., a subsidiary of San Ramon, Calif.-based Chevron Corp., with a reservation 1 bcf per day for 20 years and

* Cheniere LNG Marketing, a subsidiary of Cheniere Energy, with a reservation of 1.5 bcf per day for 20 years. Cheniere Energy is developing a platform of three LNG receiving terminals along the Gulf Coast. The terminals will have the capacity to send out 9.9 billion cubic feet of LNG per day.

Cheniere plans to leverage its platform by pursuing related LNG business opportunities along the Gulf Coast. Cheniere Energy also holds a 30 percent interest in a fourth LNG receiving terminal, is a partner in an LNG shipping venture and conducts oil and gas exploration in the shallow waters of the U.S. Gulf of Mexico.