Petroleum producer McMoRan Exploration Co. has received final approval for a $1 b liquefied natural gas project off Louisiana's coast, including storage caverns in an offshore salt dome, the company announced Thursday.
The go-ahead from MarAd was the last needed for the Main Pass Energy Hub, sources said. The record accompanying the decision was 46 pages long and outlines requirements that will be put into the license.
The facility will handle imported natural gas that has been liquefied in order to take up less space and be more easily transported by tankers. In the
LNG process, natural gas is chilled to -256 degrees Fahrenheit, turning it from a gas to a liquid, and moved into heavily insulated storage tanks. From those, reinforced, usually double-hulled tankers with insulated cargo tanks, will bring it to the terminal. There, it will be stored and heated to turn it back from a liquid to a gas.
The terminal will cost about $500m, and pipelines -- already approved by the Federal Energy Regulatory Commission -- another $500m.
Gov. Kathleen Blanco vetoed the project last year because McMoRan intended to use an open-loop system using water from the Gulf of Mexico to warm the supercooled liquefied gas. Environmentalists said that would kill an unknown amount of sea life, including fish and fish larvae.
The company changed the design to the more expensive closed-loop technology, which uses some of the gas it imports, rather than seawater, to warm the liquefied gas. The modifications will cost about $30 million, plus $25m a year in revenue lost from the natural gas used in the closed-loop system, Collier said at the time.
The conditions required by the MarAd include demonstration of
financial responsibility, compliance with applicable laws and regulations, environmental monitoring and other customary conditions.
McMoRan said the facility will be able to regasify up to 1.6b cubic feet of liquid natural gas a day, to store 28 billion cubic feet of LNG in salt caverns, and to deliver up to 3.1 billion cubic feet of natural gas to the U.S. market daily.
Source: Business Week