Driftwood LNG asks for 36 more months for construction | Business - The Advocate

Driftwood LNG asks for 36 more months for construction | Business | theadvocate.com

Driftwood LNG is asking federal regulators for another 36 months to build its $25 billion liquefied natural gas export terminal near Lake Charles.

In a filing last week with the Federal Energy Regulatory Commission, Driftwood LNG officials cited lengthy equipment delivery timelines and COVID disruptions as reasons for its request for extra time.

The 36-month extension would push back Driftwood LNG’s construction deadline from 2026 to April 2029. FERC initially approved Driftwood LNG in 2019 and gave the plant seven years for construction.

In its FERC filing, Driftwood LNG officials said progress has been steady ever since construction moved forward last year despite a lack of financing for the project. Construction activities completed so far include excavation, pile driving and concrete pouring, among other things.

The primary reason for the project’s delay is a lagging equipment delivery timeline, the filing said.

Driftwood LNG has a deal in place with Baker Hughes for refrigerant compression equipment and gas turbines to power the facility, but even the fastest possible delivery time of those components would push back the plant’s phase one opening to 2027, the FERC filing said. COVID disruptions to workforce and supply chains also caused challenges.

Project officials are still “actively engaged” in finding financing for the project but need “regulatory certainty” to secure those capital commitments, the filing said.

“As noted in many recent orders granting LNG projects extensions of time, these circumstances caused unforeseeable difficulties for LNG project development and made securing long-term LNG commercial commitments difficult over the last several years,” Driftwood LNG’s latest filing said. “However, the pandemic has finally subsided, global energy markets are rebounding, and the need to alleviate dependance on Russian gas after the invasion of Ukraine has led to increased demand for LNG deliveries from the United States to European markets.”

A successful delay would be a win for Driftwood LNG, which has seen its share of ups and downs after the last of its five previously announced long-term export contracts collapsed earlier this year.

Set for a 1,200-acre site on the west bank of the Calcasieu River south of Lake Charles, Driftwood LNG is slated to produce 27.6 million tons per year of LNG at its full strength. It is expected to create roughly 400 permanent jobs and 6,500 construction jobs.