Cheniere Loading Tanker With First U.S. Shale Gas for Export

  • Loading may take a few days and tanker departure unclear: USCG
  • With U.S. awash in gas, companies spending billions to export

Cheniere Energy Inc. is loading liquefied natural gas into a tanker at its Louisiana export terminal and may be ready to ship the first shale gas from the U.S. within days, the Coast Guard said.

The Houston-based company cooled its tanks Monday in preparation for loading the Asia Vision tanker at its Sabine Pass terminal, Coast Guard spokesman Dustin Williams said in an e-mail and telephone interview Tuesday. The tanker arrived Feb. 21. Petroleo Brasileiro SA, Brazil’s state-owned energy company, is scheduled to receive the first cargo, according to a person familiar with the deal.

Cheniere is loading the first vessel that will make cheap shale gas available to the global market. Thanks to a boom in drilling in shale formations, the U.S. is on a path toward energy independence, an about-face from a decade earlier when Cheniere and others were investing in terminals to import gas.

Initial exports will be considered commissioning cargoes as part of the start-up process to ensure the terminal is fully operational. Once that’s complete, Cheniere will need approval from the Federal Energy Regulatory Commission to operate the export terminal commercially.

U.S. companies, led by Cheniere, have been spending billions of dollars on LNG export complexes where the fuel is cooled so it can be shipped aboard ocean-going tankers. U.S. supplies will be added to an emerging international gas market similar to the one for crude oil.

Lowest Levels

Exports from the lower 48 states come as the U.S. is awash in supplies that helped drive prices to the lowest levels for this time of the year since 1999. Still, while U.S. gas is cheap, it’s no longer priced at a deep discount to other LNG supplies after the collapse in oil prices dragged down costs across the world.

U.S. LNG cargoes, in combination with new gas projects in Australia, will probably add 15 billion cubic feet of daily supply to global markets in the next few years, Genscape analyst Ted Michael said. That would be a 43 percent addition to the 35 billion currently bought and sold internationally.

Ballast Water

Asia Vision has the capacity to transport the equivalent of 3.39 billion cubic feet of gas and Sabine Pass has liquefied enough since Feb. 13 to fill the tanker, Jason Lord, an analyst with Genscape in Boulder, Colorado, said in an e-mailed report. Loading LNG ships can take 24 to 36 hours, though this particular vessel will likely be on the longer end of that, he said.

Genscape’s cameras showed that the tanker began to unload ballast water after the tanker arrived and then the “loading arms” began to move to a bent position to connect to the ship, Lord said. Since then, the ship has continued to unload ballast water, which is consistent with the vessel taking on more weight as LNG is loaded, said Lord.

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