Freeport LNG Targets Mid-December Restart for Texas Plant

Reuters, November 18, 2022

U.S. liquefied natural gas (LNG) company Freeport LNG said it was targeting a mid-December restart for its Texas export plant, which has been shut for six months after a fire, pending regulatory approval.

Freeport, the second-biggest U.S. LNG export facility, closed in June after an explosion that energy consultants said was the result of human error, inadequate operating and testing procedures and other factors.

U.S. LNG exports have steadily increased for years, and that supply has become crucial to European buyers since Russia has mostly cut off the continent's natural gas supply in response to sanctions placed on Moscow after its invasion of Ukraine.

Freeport said in a release that it expects to be turning about 2 billion cubic feet per day (bcfd) of gas into LNG in January 2023 and reach full production using both docks in March 2023.

However, its start-up will not commence until the plans are approved by the U.S. Department of Transportation's Pipeline and Hazardous Materials Safety Administration (PHMSA). PHMSA regulators did not respond to a request for comment.

Until late last week, Freeport LNG had said repeatedly the plant remained on track to return to service in November.

The United States is currently liquefying about 12 bcfd of gas into LNG for export at the country's six other big LNG export plants, according to data from Refinitiv.

Federal pipeline safety regulators released a heavily redacted consultant's report this week that blamed inadequate operating and testing procedures, human error and fatigue for the June 8 explosion.

Freeport said it submitted proposed remedial work activities for a safe restart of initial operations to regulators for their approval.


Many analysts said in recent weeks that they did not expect the plant to restart until December or later because the company had not yet submitted its restart plan to federal regulators.

The Freeport shutdown has forced customers to buy expensive LNG from other sources to supply their own customers.

In August, LNG prices hit record highs of more than $90 per million British thermal units (mmBtu) at the Dutch Title Transfer Facility (TTF) in Europe and nearly $70 at the Japan Korea Marker (JKM) in Asia .

That compares with an average of around $7 per mmBtu so far this year at the U.S. Henry Hub gas benchmark in Louisiana.

Since Freeport will not restart in November, a couple of LNG vessels that were either heading for Freeport, such as LNG Rosenrot, or had waited outside the plant, such as Prism Brilliance, have moved on to other ports.

(Reporting by Kavya Guduru and Scott DiSavino; Editing by Alexander Smith and Matthew Lewis)

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