The facility was built to import natural gas, but huge increases in production of natural gas from shale formations under several states has created a glut of natural gas in the U.S. Prices in the U.S. fell to a 10-year low this winter. Now Cheniere and others are hoping to export natural gas to markets that pay prices up to 5 times higher.Cheniere stock was up 13.8 percent to $15.99 in premarket trading.
Cheniere has lined up international customers for the natural gas and received approval from the Department of Energy to export it. The company is still awaiting approval from the Federal Energy Regulatory Commission to begin construction.
If Cheniere gets approval, it plans to make a final investment decision on the project and begin construction later this year. Construction will take two to three years.
Natural gas must be chilled to a liquid before it can be shipped. That requires so-called trains of machinery and equipment that removes impurities and chills the gas to -260 degrees Fahrenheit before the liquefied natural gas can be loaded onto specialized tankers and shipped abroad.
Not including financing costs, Cheniere says it will cost $4.5 billion to $5 billion to build the first two of four trains planned for the site. Cheniere hopes to export 2.6 billion cubic feet of gas per day, about 4 percent of daily U.S. production.
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![](http://archives.lincolndailynews.com/2012/Feb/28/images/ads/current/Graue_inc_lda022812.png) U.S. natural gas futures closed at $2.55 per thousand cubic feet on Friday. It costs about $3 per thousand cubic feet to liquefy the gas. LNG sells for roughly $10 per thousand cubic feet in Western Europe and $15 in Asia.
Some lawmakers, environmentalists and industrial customers oppose plans to export natural gas. They say it will raise natural gas prices in the U.S. Environmental groups say the process of liquefying and shipping natural gas wastes too much energy and that exporting natural gas will lead to an increase in the controversial drilling process called hydraulic fracturing in the U.S.
[Associated
Press; By JONATHAN FAHEY]
Jonathan Fahey can be reached at http://twitter.com/JonathanFahey.
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