US agency approves deepwater port license application for $8.2 billion ST LNG project

By Arathy Somasekhar

HOUSTON, Oct 28 (Reuters) - The Maritime Administration has approved a deepwater port license application for the $8.2 billion ST LNG project, US Transportation Secretary Sean Duffy said on Wednesday.

The project could further expand US liquefied natural gas export capacity. President Donald Trump's administration has promised to ease permitting in a bid to speed up energy infrastructure development.

The ST LNG deepwater port, set to be built about 10.4 miles (16.7 km) offshore Matagorda, Texas, will include four 2.1 million tonnes per annum liquefaction plants for a combined production capacity of 8.4 mtpa, the US Department of Transportation said.

The project is still in a relatively early phase but some of its proponents have been involved in the development of other projects including New Fortress Energy's NFE.O Fast LNG project.

Construction is expected to begin in 2027, with the port expected to come online in 2029. The location of the project is expected to move vessel traffic away from more congested onshore areas, reducing vessel collisions and safety risks, the department added.

The US is the world's largest LNG exporter with more than 100 mtpa of production capacity in service and close to another 100 mtpa under construction. The feed gas for the port will come from the Tres Palacios Natural Gas Storage and Trading Hub and the Williams Markham Gas Processing Plant through an existing Transco pipeline about 5.6 miles (9 km) northeast of the port.

The approval comes about 10 months after Duffy announced that the Maritime Administration (MARAD) would take on oversight of deepwater port licensing from the US Coast Guard and streamline environmental reviews and accelerate license approvals.

MARAD finalized the final environmental impact statement for ST LNG in just 410 days, nearly 3.7 years faster than the historical average, the department said, calling it the fastest deepwater port license review in more than two decades.

The Pipeline and Hazardous Materials Safety Administration also on Wednesday proposed new rules to speed liquefied natural gas projects and expand export capacity.

The Trump administration's pro-energy stance has led to a wave of public announcements from the largest LNG exporters, including Cheniere LNG.N and Venture Global LNG VG.N, that they will move forward with permitting as much LNG capacity as they think they can build because of permitting certainty.