Tellurian Expects Early-2020 FID at Driftwood

Tellurian expects to take a final investment decision (FID) on its planned Driftwood LNG export plant in Louisiana early next year, chairman Charif Souki told NGW at the Oil & Money conference in London on October 8.

Before approving the scheme Souki said Tellurian would need to presell around 12mn mt/yr of supply under the project’s first stage. So far India’s Petronet has agreed to take 5mn mt/yr while France’s Total has committed to receiving 2.5mn mt/yr.

Once greenlit, Driftwood LNG will take five years to build and operate for 40 more, Souki told the conference. Its engineering procurement and construction (EPC) contractor Bechtel can deliver the project at $560/mt/yr, he said, allowing LNG on the water at “better than $4/mn Btu”, and probably between $2.50 and $3/mn Btu.

“We and our partners will be able to get LNG anywhere in the world for $6/mn Btu and that will create demand,” he said.

The US currently has 50mn mt/yr of active LNG export capacity and a similar amount under construction. But a further 100mn mt/yr “must be produced” or the country will be unable to produce the oil, according to Souki.

Tellurian is considering obtaining its gas from three basins – Marcellus/Utica, Haynesville and the Permian – via three proposed pipelines. The choice of pipeline has not yet been made, as production prospects at different basins change quickly and a pipeline would only take a year and a half to build, he said.