Dominion seeks permission to export LNG from Cove Point

Dominion Resources Inc., Richmond, Va., has asked the US Department of Energy for permission to use its Cove Point, Md., LNG import terminal as an export facility as well. The installation is particularly well-situated to export gas produced from “the prolific Marcellus shale and promising Utica shale formations,” said Dominion Chief Executive Officer Thomas F. Farrell II.

Dominion said in its Oct. 3 application that it is seeking permission to export LNG to any country with which the US does not prohibit trade.

The application included a construction and economics study by ICF International, Fairfax, Va., and markets and supplies studies by Navigant Consulting Inc., Rancho Cordova, Calif. Dominion said the filing was the second phase of a two-part authorization request. It said it filed the first phase—a request for authorization to report LNG to countries which have a free trade agreement with the US—on Sept. 1.

The new application seeks permission to export as much as 1 bcfd over 25 years, Dominion said. Liquefaction facilities would have to be added to the Cove Point terminal at Lusby, Md., with construction potentially beginning in 2014 and service starting at yearend 2016, it said.

It said it is proposing to operate Dominion Cove Point as a bidirectional terminal, which would continue to have the capacity to import LNG and gasify it for send-out to US customers as well as liquefying gas for loading onto tankers bound for non-US customers. Liquefaction would be a service provided to customers who would retain ownership of the gas or LNG, and be responsible for supplying it to the terminal and selling it to foreign entities, Dominion indicated.

The project would also require approvals from the US Federal Energy Regulatory Commission and other federal, state, and local governmental authorities, Dominion noted. “While this project offers substantial potential benefits, Dominion has not made the final decision on pursuing [it] and does not plan to do until the necessary regulatory approvals, customer commitments, and approval by Dominion’s board of directors are received,” it added.

Contact Nick Snow at nicks@pennwell.com.

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