Reuters: Regulatory News: US regulators vote on LNG export project next week

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US regulators vote on LNG export project next week Apr 13th 2012, 16:20 Fri Apr 13, 2012 12:20pm EDT * FERC expected to approve Cheniere plant in Louisiana * First US liquid natural gas export facility in 50 yrs * International prices seven times higher NEW YORK, April 13 (Reuters) - U.S. regulators will vote next week on Cheniere Energy Inc's proposed liquefied natural gas (LNG) export plant at Sabine Pass in Louisiana. It would be the first U.S. facility of its kind in the United States in nearly 50 years. The Federal Energy Regulatory Commission (FERC) will decide whether to approve construction of the project in its monthly meeting on April 19, according to the commission's website, potentially providing the last approval needed for work to begin. Cheniere, which aims to start sending natural gas abroad by 2015 pending a FERC environmental review, already has government approval to do so. Sabine Pass LNG would be built on the same site as Cheniere's existing LNG import plant, which analysts say increases the company's chances of getting the FERC go-ahead. "We expect the project to be approved, with conditions," said Baird Equity Research analysts in a note on Friday. "We don't know whether any conditions would constitute a requirement that could potentially delay the start of construction." FERC's decision is being watched closely by U.S. natural gas producers and consumers as they debate the benefits and drawbacks of shipping an abundant domestic resource overseas. A number of other U.S. projects have also been proposed to export LNG (natural gas cooled to a liquid for shipping) to international markets where prices are more than seven times higher than at home. Only Cheniere has government approval to export LNG globally. U.S. natural gas production has rocketed in recent years because of new technologies that have allowed drillers to tap vast shale deposits dotted across the country. Once expected to be a major importer, the United States now has decades of supply. Surging natural gas production has swamped the U.S. market this year, pressuring prices to 10-year lows that have crimped profits for drillers. Consumer critics are concerned that export will push domestic prices higher. The U.S. government said in January that exporting natural gas could add between 3 and 9 percent a year to prices over the next two decades. Link this Share this Digg this Email Reprints

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