Commonwealth LNG expects first US export permit by June
By Curtis Williams
HOUSTON, May 31 (Reuters) -Commonwealth LNG expects the U.S. Department of Energy (DOE) to approve a license as early as next month that would allow it to export liquefied natural gas (LNG), according to Executive Chairman Paul Varello.
The license to sell output to non-Free Trade Agreement countries is crucial to its board reaching a final investment decision (FID) by the end of the year, he said in an interview on the sidelines of an energy export conference in Houston.
"We can’t take FID without a Non-FTA permit. DOE is well aware of that and is working to get us that permit," Varello said.
It would be the first since the agency denied Energy Transfer's ET.N Lake Charles LNG a second extension to its Non-FTA permit and said it would only allow extensions under extenuating circumstances.
Commonwealth believes it will be able to export LNG within three years of receipt of the Non-FTA LNG export approval, Varello said. The company is developing a LNG export terminal on the U.S. Gulf Coast near Cameron, Louisiana.
Varello also said he does not expect a third wave of LNG projects in the United States later this decade because of tougher conditions for permits and financing for new projects.
Commonwealth has been awaiting approval for a Non-FTA export license for more than four years. Even if it gets the license, it still needs buyers to commit to import its LNG come 2027.
So far, the company has secured 25% of its proposed 9.3 million tonnes per annum production in contracts, including to Woodside Energy, and is in discussion with possible clients, Varello said.
There is a reluctance from the financial sector to back projects with a payback period over 15 years because of concerns about the viability of LNG as the world moves to net zero (emissions) by 2050, Varello noted.
Reporting by Curtis Williams in Houston; Editing by Bill Berkrot
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