Tellurian Asks FERC for 3-Year Extension to Finish Louisiana Driftwood LNG Export Plant

(Reuters) — U.S. energy company Tellurian Inc. has asked federal energy regulators for more time to build its Driftwood liquefied natural gas (LNG) export plant in Louisiana.

Driftwood is one of dozens of U.S. LNG export projects that have been under development for years while other plants found customers and were built, putting the United States on track to become the world's biggest LNG exporter this year.

In a filing late on Wednesday, Tellurian's Driftwood LNG asked the U.S. Federal Energy Regulatory Commission (FERC) for an extra 36 months beyond the originally authorized in-service date to complete construction of the LNG plant and an associated natural gas pipeline.

In April 2019, FERC approved the construction of the 27.5-million tonnes per annum (MTPA) Driftwood and gave Tellurian seven years, or until 2026, to complete the project. The extra 36-months would give Tellurian until 2029 to finish the project.

In support of its application, Tellurian said Driftwood entered into an Engineering, Procurement and Construction (EPC) contract in November 2017 with U.S. construction company Bechtel to build the plant.

In March 2022, Driftwood gave Bechtel a "limited notice to proceed with construction ... (and) over the past 17 months, construction has progressed continuously."

Tellurian, however, is still looking for customers to buy LNG from the plant and has not yet made a final investment decision (FID) to start major construction on the roughly $14.5 billion first 11-MTPA phase of the project.

Tellurian said it needed the extra 36 months to complete the project due in part to a contract with U.S. energy services company Baker Hughes BKR.O to supply eight main refrigerant compression packages for the first phase.

The timing of those refrigerant packages, Tellurian said, would push back the in-service timeline to no earlier than late 2027 for phase 1 and into 2029 for phase 2.

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