Driftwood LNG, a subsidiary of US natural gas company Tellurian, has exercised its long-term lease option for its site in Sulphur, Louisiana, US, with the Lake Charles Harbor and Terminal District.
The new ground lease, for a 477 acre site, has an initial term of 20 years with the option to extend to 50 years.
Driftwood LNG, when fully complete, will have a capacity of 27.6m t/y with up to 20 trains of 1.38m t/y each. It will have three storage tanks each with a capacity of 235,000 m3, and three marine berths.
Tellurian announced in June 2020 that it would delay construction of Driftwood LNG until 2021, following the failure to agree offtake agreements, including with India’s Petronet LNG, and the construction delay to the Permian Global Access Pipeline, which would have brought in supplies from West Texas. Low LNG process, weak demand and the COVID-19 pandemic are also thought to have played a role. However, in June 2021, Gunvor Singapore and Vitol have signed 10-year LNG sales and purchase agreements (SPAs) for Driftwood LNG, each for 3 million tpa, valued at around US$12 billion (€9.9 billion) in revenue over the 10-year period. The company has said it is seeking SPAs for 15 million tpa before the final go-ahead.
‘Tellurian is taking necessary steps to prepare for Driftwood LNG construction by entering into this long-term lease and executing certain projects such as road improvements and utility relocation. We have an active and productive relationship with Port of Lake Charles officials and they have been helpful partners from the early development and site selection of our liquefied natural gas export terminal. Tellurian appreciates and thanks the Lake Charles Harbor and Terminal District Board of Commissioners for their hard work and the ongoing role they will play in the success of Driftwood LNG,’ says Tellurian executive vice president and chief operating officer Keith Teague.