Venture Global, knee-deep in a dispute with offtakers over the lengthy commissioning at its flagship Calcasieu Pass LNG facility, is facing fresh scrutiny over the timeline of its second Louisiana project.
First exports from the initial 10 million ton per year (1.4 billion cubic feet per day) phase of the Plaquemines LNG terminal were originally pegged for the third quarter, but it appears to be running behind schedule based on the timing of regulatory requests submitted to the Federal Energy Regulatory Commission (FERC), according to a new report from consultancy Arbo.
“While Plaquemines LNG’s modular technology and cooldown strategy introduce interesting variables into our timeline analysis, the remaining regulatory steps, broader historical precedent and comparisons to Calcasieu Pass all suggest that achieving first LNG by the end of Q3 2024 was an ambitious goal,” Arbo said.
But the timeline does not appear to have slipped much. In an Oct. 1 filing with the Department of Energy, Venture Global said it expects to produce its first LNG cargo by the end of the year. That closely aligns with Arbo’s updated forecast, analyst Rohan Nimmagadda told Energy Intelligence.
Venture Global did not respond to multiple requests for comment.
Will History Repeat?
Perhaps of greater concern to potential Plaquemines offtakers is the time from first LNG to commercial operations. According to the FERC filing, Plaquemines isn’t expected to be placed into commercial service until mid-2026, a year and a half after shipping its first cargo.
The lengthy commissioning time isn’t a big surprise: Venture Global CEO Mike Sabel has made statements indicating a 24-month period from first LNG to commercial start-up, which would trigger long-term contracts for cargoes. But additional delays could offer a repeat of the issues at Calcasieu Pass, which have resulted in arbitration proceedings between Venture Global and a slew of offtakers, according to Arbo.
“The ongoing issues at Calcasieu Pass serve as a cautionary tale,” the report said. “The prolonged commissioning period and disputes over transparency at Calcasieu Pass could potentially foreshadow similar challenges for Plaquemines LNG. We will be watching to see if history repeats itself.”
Shell, one of the the terminal's large global Calcasieu Pass offtakers, has asserted that Venture Global has made $3.5 billion more by selling LNG on the spot market than it if it had delivered contracted shipments, a contention Venture Global called "paid propaganda."
Shell is also a contracted offtaker from Plaquemines, as are fellow supermajors Chevron and Exxon Mobil, German electricity supplier ENBW and Malaysia's Petronas. Sources tell Energy Intelligence they are watching closely to see if a similar scenario plays out again.
Potential Market Impacts
If Plaquemines' start-up is postponed any further, it could impact short-term market forecasts that have the plant’s capacity baked into their predictions. "Project delays remain a key risk for LNG supply additions being pushed later in 2025," shipping data tracker Kpler said in its winter outlook.
The Natural Gas Supply Association’s recent winter forecast accounts for Plaquemines coming on line at the end of the year and ramping up into the summer. And in its Short-Term Energy Outlook this week, the Energy Information Administration said it assumes LNG exports from Plaquemines will start by December, with "the full ramp up of all blocks of Phase 1 by spring 2025.”
Arbo said the modular liquefaction technology used at Plaquemines could theoretically mean a faster construction timeline. But it also could result in a longer-than-expected commissioning period as seen at Calcasieu Pass.
One industry source pointed out that even with the 2026 in-service date, the time from Plaquemines’ 2022 final investment decision to commercial operations is relatively short compared to traditional stick-built facilities.