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Kinder Morgan project would boost output at Elba Island LNG facilityfrom SNL Daily Gas Report Kinder Morgan project would boost output at Elba Island LNG facilityByline: Corey Paul Kinder Morgan Inc. asked US energy regulators for permission to make modifications at its Elba Island LNG export terminal that the company said will curb flaring and boost LNG output by about 400,000 metric tons per year. The Federal Energy Regulatory Commission said in a May 10 notice of the Kinder Morgan application that it was considering whether to pursue an environmental assessment or a more extensive environmental impact statement for the project. The project would modify Elba Island's 10 modular natural gas liquefaction facilities, build a new condensate plant, install three liquid nitrogen vaporizers and increase the authorized liquefaction capacity of the facility from 2.5 million metric tons per year to 2.9 MMt/y. The roughly $2 billion Elba Island terminal, which came online in October 2019 and exported its first cargo in December 2019, is the smallest of the seven major US LNG export terminals in operation. Delivered LNG volumes from the facility in 2022 totaled about 2.3 MMt, S&P Global Commodity Insights data showed. Kinder Morgan laid out plans for the estimated $64 million Elba Island modification project at FERC on April 28, saying it was proposing the project to improve the liquefaction process at the terminal. The terminal operator asked for FERC approval by May 2024 so that it could begin service of the condensate plant and nitrogen vaporizers by August 2024. Modifications to the liquefaction units would be made during planned maintenance over the course of four or five years. Kinder Morgan said the purpose of the project is to reduce the "fouling rate" of the liquefaction units, which refers to the accumulation of unwanted materials. In the case of Elba Island, the operator said a contributing factor was the composition of feedgas for the facility, "which tends to be more lean with a heavy hydrocarbon tail" compared to the gas characteristics the developer had originally assumed. Trace heavy hydrocarbons passing through cold gas separators at each liquefaction unit leads to increased fouling of the heat exchangers called cold boxes. This issue has required the operator to warm up the system to clean out the frozen particles of heavy hydrocarbons and regain normal operating pressures, according to the application at FERC. The process involves flaring gas, and it reduces LNG production rates. The modification project will allow the liquefaction units "to operate in an optimized condition for longer periods of time without fouling, thus yielding improved LNG production and lower [greenhouse gas] emissions" associated with flaring, Kinder Morgan told FERC. The exporter estimated the modifications would result in eliminating nearly 12,000 metric tons of greenhouse gas emissions from flaring. The Elba Island terminal is backed by a 20-year offtake agreement with Shell PLC, the sole customer of the facility. In September 2022, Kinder Morgan sold half its equity stake in the subsidiary that owns the Elba Island liquefaction facility to an undisclosed buyer for about $565 million. Kinder Morgan, through its Southern LNG Co. LLC subsidiary, remains the operator of the export terminal. S&P Global Commodity Insights reporter Corey Paul produces content for distribution on Platts Dimensions Pro. |
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