Aug. 30–A $2 billion expansion of the Elba Island liquefied natural gas terminal is nearing completion on the Savannah River about five miles downstream from downtown.
Initial in-service for the project is expected in the fourth quarter of 2018, with final units coming online by the third quarter of 2019. When complete, Elba, whose five sky-blue tanks are visible for miles, will be able to export 0.35 billion cubic feet per day (Bcf/d) of LNG. The project uses a new technology, developed by Shell, called Movable Modular Liquefaction System. When finished there will be 10 small-scale liquefaction units, called trains.
The existing import facility on Elba opened in 1978 and closed in 1980 after then-owner El Paso had a contract dispute with its supplier. Elba reopened in 2001 and expanded its storage capacity. But over the last few years it’s seen little activity as fracking increased domestic natural gas production and prices fell. Owners Kinder Morgan and EIG Global Energy Partners are expanding now to take advantage of this situation by reversing Elba’s current processes. Soon natural gas that’s piped into Elba will be super cooled to liquefy it, thus shrinking its volume and making it possible to export by ship.
Elba will be the third new export facility to come on line in the U.S. recently. Sabine Pass opened in Louisiana in 2016 and Cove Point in Maryland began exporting earlier this year.
The Federal Energy Regulatory Commission authorized the Elba expansion project in June of 2016. Construction began on Nov. 1, 2016, and is supported by a 20-year contract with Shell.
The U.S. Energy Information Administration reported that since the beginning of 2016 four processing units at the Sabine Pass liquefaction terminal in Louisiana have come online (with a liquefaction capacity of 2.8 billion cubic feet/day) as has the Cove Point terminal in Maryland (0.8 Bcf/d peak capacity). The amount of U.S. natural gas exported as LNG averaged 2.6 Bcf/d equivalent in the first quarter of 2018, 1.0 Bcf/d (62 percent) more than in the same period last year. EIA expects the United States to have a total liquefaction capacity of 9.6 Bcf/d by the end of 2020.
The U.S. was a net exporter of natural gas in the first quarter of 2018, with net exports averaging 0.6 Bcf/d. In 2017 as a whole, the United States was a net exporter of natural gas for the first time since 1957. Both LNG exports and pipeline exports have contributed to this shift in natural gas exports, according to the U.S. EIA.
Elba will still be able to import LNG, Kinder Morgan spokeswoman Melissa Ruiz wrote in an email.
“(B)ased on market conditions, the facility will have the ability to handle both imports and exports at the customer’s discretion,” she wrote.
Permanent new jobs are coming with the expansion.
“We are in the process of hiring 100 new personnel,” Ruiz wrote. The number involved in construction has varied from over 2,000 construction jobs, to an average of about 1,700 now.
Chatham County records indicate that Southern Energy Co., a subsidiary of Kinder Morgan was assessed $1.3 million in annual taxes this year on its Elba property, making it the seventh highest tax bill the county sent out. That bill has the potential to increase with the $2 billion expansion. The property sits in unincorporated Chatham County.
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