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The U.S. Department of Energy has extended the export terms for seven LNG license until 2050 for projects currently under construction or pending the start of construction.
The extensions include the Golden Pass terminal in Texas, the Brownsville project, also in Texas, as well as the Delfin, Driftwood, and Magnolia projects in Louisiana. The Costa Azul project in Mexico, led by Sempra Energy, was also included in the extensions.
“The success story of U.S. LNG continues to be written, and these extended authorizations will ensure that the benefits from these exports continue for decades to come,” said U.S. Secretary of Energy Dan Brouillette. “The United States just set a new all-time high record for LNG exports in November 2020, and the monthly rate of LNG exports has now quintupled since the beginning of the Trump Administration.”
Liquefied natural gas has become a major growth area for U.S. energy exporters, although the U.S.-China trade war and the pandemic have interfered with ambitious plans for leadership in the space.
U.S. LNG shipments to China fell to zero in the 12 months to March this year, and a lot of shipments to other destinations were canceled after the pandemic ravaged demand. Now, however, exports of LNG to China are set to start growing once again in the next few years. Cheniere Energy alone signed a deal to supply 26 LNG cargos to Chinese Foran Energy Group over the next five years.
Europe is another growth market for U.S. LNG exports, although emissions-related ambitions by the EU are threatening this potential growth due to concerns about the emissions related to producing the natural gas from fracked wells.
“It is important for DOE to do everything to assure a long-term future for U.S. LNG exports, which will continue to meet global energy security and emissions reduction goals,” said Acting Under Secretary of Energy and Assistant Secretary of Fossil Energy Steven Winberg, in comments on the extension of export terms.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com