Two Weeks After Harvey, Cheniere Runs More Gas Than Ever

  • Date: 18/09/17
  • Bloomberg

Two weeks after Hurricane Harvey flooded the U.S. Gulf Coast, brought shipping to a halt and knocked out power to millions, the only company sending U.S. shale gas overseas is back in business. In fact, Cheniere Energy Inc.’s flagship Sabine Pass terminal in Louisiana is liquefying more natural gas for export than ever.

Cheniere fully restored operations at the complex this past weekend. And a few days after that, the company brought in and liquefied a record 3.1 billion cubic feet of gas, said Doug Shanda, senior vice president of operations. With another expansion nearing completion, the Houston-based company expects to extend that record this winter, he said in a phone interview Thursday.

As Harvey drenched the region, Cheniere was acutely aware of its status as the first shale gas export terminal built along the U.S. Gulf Coast. About three dozen like it have been proposed, but for now, it’s alone. So all eyes were on Cheniere during the storm. Citigroup Inc. warned of possible disruptions at the terminal while Genscape Inc. speculated on how long it would remain open. It became a litmus test of sorts — for how resilient America’s gas supplies could be in a global market.

“We are the poster child of the way this is supposed to work out,” said Corey Grindal, Cheniere’s senior vice president of supply.

If it’s any indication of how the terminal fared, it never shut. Sabine Pass kept liquefying gas throughout the storm, even as a major Kinder Morgan Inc. supply line went down, dangerous storm surges halted vessel traffic and tanks began filling up.

The way Grindal sees it, Cheniere had no choice but to keep running. As the country’s largest gas buyer, the company has contracts to bring in massive shipments of gas by pipeline — and contracts to turn the fuel into a liquid for loading onto tankers.

As long as the plant is operating, “I don’t have the right to call up a producer or a supplier and say, ‘I’m not taking your gas,”’ he said.

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