LNG Tanker Sails for US Sabine Pass for Inaugural Loading

Cheniere Energy's landmark Sabine Pass liquefied natural gas export plant in Louisiana will receive its first tanker for loading on Jan. 12, according to ship tracking data and a source with knowledge of the plant's operations.

 

The Energy Atlantic LNG tanker, which was last seen on Thomson Reuters ship tracking data on Monday steaming west across the Indian Ocean, is the first in a string of test cargoes that will be loaded before commercial operations begin later in the year.

 

The expected arrival of the tanker to Sabine Pass was confirmed by a source and by IHS Waterborne consultants that track LNG shipments globally.

 

It marks a milestone for the long-awaited project, the first of its kind to be built in the United States in nearly 50 years, and for the U.S. gas market that has been swamped with new supply in recent years due to a domestic drilling boom.

 

It is unclear when the Energy Atlantic will actually leave Sabine or where it will go.

 

One source said the test phase could take four to six months before the first shipments under a long term contract between Cheniere and LNG shipper BG Group (BRGXF) begin.

 

The first export shipment represents a turnaround for Cheniere, which in 2008 built an import terminal at the same site in Sabine Pass which was quickly rendered obsolete by the rise in U.S. production.

 

Now, however, other headwinds exist for exports, including a global glut of supply that has pushed prices way below year-ago levels.


(Reporting By Edward McAllister and Oleg Vukmanovic; editing by Grant McCool)