Shell PLC SHEL-N has submitted a letter to the U.S. Energy Department in support of Energy Transfer’s request for a new licence to export liquefied natural gas (LNG) to countries without free trade agreements with the U.S., saying the pipeline operator is a reliable gas supplier.
Shell is among energy companies that have filed arbitration cases against Venture Global LNG over its failure to supply fuel under long-term contracts, even as it has shipped at least 200 cargoes to non-contract customers.
“Reliability of supply has become a key issue recently among nonfree trade countries purchasing U.S. LNG and Shell very much values Energy Transfer’s credibility to deliver on what it promises,” said Jill Davies, president of Shell North America LNG company, in the letter seen by Reuters.
In August, Energy Transfer requested a new and expedited export licence for its proposed Lake Charles, Louisiana, LNG plant, according to a DOE filing.
The DOE in May had refused a three-year extension to Energy Transfer’s earlier licence, saying the request did not meet criteria for a second extension. Several other companies including Commonwealth LNG have been waiting years for their non-FTA licence to be approved.
South Korea’s SK Gas LLC and U.S. independent gas producer EQT Corporation also sent letters to the DOE in support of Energy Transfer’s application.
Energy Transfer has been pursuing the multi-billion-dollar Lake Charles LNG project since 2012. In an August filing, it said it could not finish the plant before the existing licence’s 2025 deadline, so it wants to receive a new licence by Feb. 19, 2024 that would give it seven more years to complete the project.
The Dallas-based pipeline operator said it was unable to meet the construction deadline, in part due to unplanned delays and a decision to add a carbon capture and sequestration component to the plant.
The firm, controlled by billionaire Kelcy Warren, is one of the largest U.S. natural gas pipeline operators. It has long-term agreements to supply 7.9 million metric tons per annum (MTPA) of the proposed plant’s 16.45 MTPA capacity.