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Dive Brief:
- The developers of the $11.6 billion Golden Pass liquefied natural gas export project in Texas have requested a three-year extension to complete construction, citing delays caused by the bankruptcy filing of the main construction contractor, according to documents filed with the Federal Energy Regulatory Commission on Aug. 28 .
- Former prime contractor Zachry Holdings filed for Chapter 11 bankruptcy protection in May, saying the megaproject was at least $2.4 billion over the original budget, hemorrhaging money. The contractor has had years of disputes over costs, payments, layoffs and project delays with developer Golden Pass LNG Terminal LLC.
- Golden Pass LNG is formed by joint developers Qatar Energy and ExxonMobil, which respectively have a 70% and 30% stake in the methane gas project. them reached an agreement with San Antonio-based Zachry Holdings allowed him to exit the project in July.
Diving knowledge:
The developers requested an extension to build and commission the facility by November 30, 2029. The project was originally scheduled to enter service in December 2021, and then got an extension to finish the works in November 2026.
In the latest extension request filed with FERC, the developer said schedule uncertainties related to the transition to a new prime contractor mean the project needs more time and cited “other potential delays beyond the control of GPLNG that may occur, such as potential hurricane impacts, and for start-up and commissioning activities, this additional time is necessary to complete construction of the project and bring it into service.”
The company intends produce the first LNG around the end of 2025, with commercial operations following, a Golden Pass LNG spokesman told Reuters, with additional time built in for contingencies.
The Golden Pass project is located in Port Arthur’s Sabine Pass neighborhood on the site of a former import terminal that was converted to process methane gas for export, according to Reuters. It has an annual export capacity of approximately 18 million tons.
The project was initially estimated to cost $9.25 billion in 2019, but that skyrocketed by 25% in August 2022 due to COVID-19 and geopolitical issues.
