USA: EPC Sempra and Bechtel Sign Contract for Port Arthur LNG Project
With expansion capabilities of up to eight liquefaction trains and approximately 45 mtpa of capacity, the Port Arthur LNG project is claimed to become one of the largest LNG export projects in North America. Under the terms of the agreement, Bechtel’s subsidiary Bechtel Oil, Gas, and Chemicals will carry out detailed engineering, procurement, construction for the project.
California/USA – Sempra Energy and Bechtel have recently announced that their respective subsidiaries, Port Arthur LNG and Bechtel Oil, Gas, and Chemicals, have signed a fixed-price engineering, procurement and construction (EPC) contract for the Port Arthur LNG liquefaction project in Port Arthur, Texas.
“Building new export infrastructure in the U.S. is critical to providing overseas markets with cleaner fuel alternatives,” said Jeffrey W. Martin, chairman and CEO of Sempra Energy. “Partnering with a world-class construction firm like Bechtel bolsters our execution plan for one of the world’s largest LNG development projects.”
As part of the EPC contract, Bechtel Oil, Gas, and Chemicals will perform the detailed engineering, procurement, construction, commissioning, startup, performance testing and operator training activities for the project. The scope of the agreement also includes continuing pre-final investment decision engineering to better assure project cost and schedule certainty.
The Port Arthur LNG development project is expected to initially include two liquefaction trains, two LNG storage tanks, a marine berth and associated loading facilities and related infrastructure, with a nameplate capacity of approximately 13.5 million tonnes per annum (mtpa) of LNG. The project site sits on nearly 3,000 acres of land along three miles of the Sabine-Neches waterway. It also has the potential to become one of the largest LNG export projects in North America, with expansion capabilities of up to eight liquefaction trains and approximately 45 mtpa of capacity.
In January, Sempra LNG signed an Interim Project Participation Agreement (IPPA) with Aramco Services Company, a subsidiary of Saudi Aramco, for the proposed Port Arthur LNG project. The IPPA represents another milestone for both companies after signing a heads of agreement in May 2019 for the potential purchase of 5 mtpa of LNG and a 25 % equity investment in the project. In December 2018, Port Arthur LNG entered into an agreement with Polish Oil and Gas Company for the sale and purchase of 2 mtpa of LNG per year.
The Port Arthur LNG development project received authorisation from the U.S. Department of Energy to export domestically produced LNG to countries that do not have a free trade agreement with the U.S. in May 2019. Additionally, the Federal Energy Regulatory Commission issued the approval to site, construct and operate the liquefaction-export facility in April 2019.
It is estimated that the proposed project will create a craft workforce on site that peaks at about 5,000 construction jobs, as well as several hundred additional Texas jobs in support of the project, including material fabrication. Nearly 200 long-term jobs will be created to operate and maintain the Port Arthur LNG facility.
Development of the Port Arthur LNG project is contingent upon obtaining additional customer commitments, completing the required commercial agreements, securing all necessary permits, obtaining financing, incentives and other factors, and reaching a final investment decision.