Thu, Jul 18 2024 18 July, 2024

Venture Global LNG project gets key greenlight from U.S. govt

Venture Global’s CP2 project, an enormous LNG project in southwest Louisiana, obtained a construction authorisation from federal regulators. But it will remain sidelined until Biden’s LNG “pause” is completed.

The Calcasieu Pass LNG terminal in Louisiana, the U.S. (Photo: Nick Cunningham/Gas Outlook)

One of the most controversial LNG projects in the U.S., Venture Global’s CP2 project, received a key permit from the federal government, although it still awaits a separate permit that prevents it from moving forward for now.

On Thursday, the U.S. Federal Energy Regulatory Commission (FERC), the federal entity that regulates LNG terminals, granted a construction authorisation to Venture Global’s CP2 project, located in southwest Louisiana. CP2 is an expansion of the existing Calcasieu Pass LNG project, which has earned the company billions of dollars in gas exports in recent years.

“Venture Global applauds the Commission and FERC staff for their independent and thorough review and approval of CP2 LNG,” Mike Sabel, CEO of Venture Global, said in a statement. “This project will be critical to global energy security and supporting the energy transition.”

FERC voted 2-1 in favour. Commissioner Allison Clements, the lone dissenter, criticised the majority’s decision: “The Order fails to meaningfully assess these Projects’ enormous greenhouse gas (GHG) emissions and does not explain whether or how the Commission factored them into its public interest determinations,” she wrote. She added that the approval order “improperly discounts impacts to commercial fishing businesses, which will likely be significant.”

Gas Outlook reported on the local impacts of Venture Global’s Calcasieu Pass facility earlier this year. Calcasieu Pass has already damaged the commercial fishing industry in the region, and CP2 is expected to exacerbate the environmental challenges.

The project could result in 190 million tonnes of CO2 emissions per year, equivalent to 51 coal-fired power plants or 42 million gasoline powered cars, according to the Sierra Club.

While the FERC approval is a significant milestone for Venture Global, the decision was largely expected. CP2 is still missing a key authorisation from the Department of Energy to export gas to countries that don’t have a free trade agreement with the U.S. That permit was subjected to President Biden’s high-profile LNG “pause” announced in January. CP2 became the face of the campaign against LNG exports by national environmental groups and Gulf Coast communities who are inundated with existing fossil fuel infrastructure.

The additional review — which will take a deeper look at climate and economic impacts of exporting ever-increasing volumes of LNG — is not expected to be completed until early 2025, after the presidential election.

Until CP2 receives the DOE authorisation, the project will remain in limbo.

“I’m watching the day-to-day operations of Venture Global, the one that’s existing here right now. They’ve been flaring, they’ve had a 30-to-50-foot flame on their flare for the last 24 hours,” John Allaire, a retired environmental engineer who worked in the oil and gas industry and who lives about a mile from Calcasieu Pass LNG, said at a virtual press conference. “I’ve been documenting how their operations look to the folks here in Cameron parish on a day-to-day basis, but it’s very disappointing.”

Venture Global has framed its project as vital for the energy security of America’s allies in Europe. The company has signed 20-year contracts for its CP2 export capacity with ExxonMobil, Chevron, JERA, New Fortress Energy, INPEX, China Gas, SEFE and EnBW.

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