This is an excerpt from EERE Network News, a weekly electronic newsletter.

September 17, 2003

DOE and Energy Companies Pursue Greater U.S. Imports of LNG

Liquefied Natural Gas, or LNG, has been a subject of increasing attention since July, when Energy Secretary Spencer Abraham proposed holding a Global Liquefied Natural Gas Summit by the end of this year. About the same time, Alan Greenspan, Chairman of the Federal Reserve Board, noted that increased LNG imports could act as a "safety valve" to help the U.S. natural gas markets respond to price spikes caused by imbalances of supply and demand within the United States. DOE reiterated that message on September 10th, when it enlisted the National Association of Regulatory Utility Commissioners (NARUC) to help educate energy decision-makers about LNG. See the DOE press release.

Meanwhile, the U.S. energy industry has been actively pursuing LNG imports. The Cove Point facility in southern Maryland, owned by Dominion, has been reactivated after a 23-year shutdown and received its first shipment in late August. On September 10th, Sempra Energy received approval to build a new LNG receiving terminal near Lake Charles, Louisiana. The company plans to begin construction next year, more than 20 years after the last LNG terminal was built in the United States. The terminal should begin operating in 2007. And Tracebel Electricity and Gas International, which currently supplies about half of U.S. LNG imports, has expanded its LNG terminal in Everett, Massachusetts, and has added two more vessels to its shipping fleet. The company's LNG shipments for the first half of 2003 increased 65 percent compared to the first half of 2002. See the press releases from Dominion, Sempra Energy, and Tracebel.

Both Sempra Energy and Shell received approvals in August to build LNG terminals in Baja California, Mexico. Shell will import the LNG from an offshore LNG export terminal near Western Australia. The company intends to build a new pipeline from the project to the existing natural gas infrastructure, allowing the new terminal to serve natural gas needs in western Mexico and southern California. ChevronTexaco has similar plans, using an offshore terminal near Baja California, and is also seeking permits for an offshore LNG terminal near the Louisiana coast. And Contango Oil & Gas Company is planning an LNG terminal on Quintana Island, located near Freeport, Texas. See the press releases from Sempra Energy, Shell (August 5th and August 19th), ChevronTexaco, and Contango (PDF 88 KB). Download Acrobat Reader.