Canadian LNG project in Oregon faces delay for regulatory approvals

A Calgary company proposing to build an LNG export facility in Oregon says the timeline for the project worth an estimated$10 billion USis being delayed by about a year.

Pembina Pipeline Corp. says it has decided to minimize project spending at about $50 million this year as it tries to vault remaining regulatory and permitting hurdles for the Jordan Cove liquefied natural gas project at Coos Bay, Ore., and a related 370-kilometre pipeline.

The reduced level of work is expected to result in construction delays such that first gas exports are now expected one year later than the targeted date in 2024.

Pembina, which inherited the project when it purchased Veresen Inc. in 2017, said it received a draft environmental impact statement from the U.S. Federal Energy Regulatory Commission in March that provided a framework for approval of the Jordan Cove project as proposed with "reasonable" conditions.

However, a final FERC decision is not expected until next January, and critical Oregon state permits aren't expected until near the end of this year.

A previous, smaller version of the project was denied by FERC in 2016 due to landowner objections and what it said was a failure to demonstrate demand for its product.

Pembina says it still intends to bring in partners for the pipeline and liquefaction facility to reduce its ownership to between 40 and 60 per cent.

It said it has non-binding off-take agreements with customers in excess of the planned design capacity of 7.5 million tonnes per year but will pause executing binding deals until early 2020.