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Lake Charles LNG eyes 2020 FID

Shell-led project could reach completion by end of 2025

The Shell-led Lake Charles liquefaction project in Louisiana could reach a final investment decision as early as the end of next year, according to regulatory documents filed Friday.

The schedule would also see the facility completed in December 2025, the project's developer said in the documents filed with the US Federal Energy Regulatory Commission.

The planned 16.45 million tonnes per annum facility would provide Shell with an operated LNG export position on the US Gulf Coast by the mid-2020s.

The project, if sanctioned, would convert US midstream giant Energy Transfer’s existing Lake Charles LNG import and regasification terminal to an LNG export facility.

Shell inherited the project through its 2016 takeover of BG Group, which had a 100% equity interest in Lake Charles LNG and had also subscribed for 100% of the capacity.

However, under a new framework agreement finalised in March, Shell said it would now lead the project with a 50% equity stake, with Energy Transfer taking the other 50%. Both companies have also subscribed for a 50% capacity stake as well.

The Lake Charles LNG developers disclosed the new schedule while requesting more time to build the project, which received federal approval in 2015 with a pipeline modification deadline of December 2019 and a facilities deadline of December 2020.

The developers are seeking an extension to 16 December 2025.

"The project sponsors are eager to continue to move forward with the project and receipt of the requested extension is a necessary step," Lake Charles LNG said.

Shell and Energy Transfer have been working to progress the project since signing the framework agreement, and have spent more than $300 million to date in development costs while another $150 million have been approved, according to the letter.

An invitation to tender for potential engineering, procurement and construction contractors was issued in April, and the Lake Charles LNG consortium have already awarded work to EPC companies to verify existing front-end engineering design, according to the letter.

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