The US Pipeline and Hazardous Materials Safety Administration (PHMSA) said on Thursday that Freeport LNG, the operator of the 15 mtpa liquefaction and export facility in Texas, must complete several corrective actions prior to restarting the plant.
Earlier this month, Freeport LNG said it expects to resume partial operation at its LNG export plant in about 90 days after an incident took place at the facility on June 8.
The LNG terminal operator also said it does not expect completion of all necessary repairs and a return to full plant operations until late 2022.
This shutdown reduced US LNG exports by some 2 billion cubic feet per day (Bcf/d), or 17 percent of the total US LNG export capacity.
“Risk to safety”
PHMSA announced the measures in a notice of proposed safety order released on Thursday.
Although the root cause of the explosion and associated fire in a pipe rack near the LNG storage tanks has yet to be confirmed, preliminary evidence suggests that an isolated pressure safety valve created an overpressure situation in 300 feet of vacuum insulated piping, PHMSA said.
“As a result of the preliminary investigation, it appears conditions exist at Freeport’s LNG export facility that pose an integrity risk to public safety, property, or the environment,” it said.
According to the regulator, Freeport LNG “may not return its LNG export facility located on Quintana Island, Texas to normal operations until it receives written approval from the Director”.
Until it receives approval to return to normal operations, Freeport LNG must provide weekly updates on the temperature and density of the LNG stored in its three LNG storage tanks, it said.
Also, Freeport must select an independent third-party or -parties to perform the evaluations and assessments, PHMSA said.
Within 60 days of issuance of the order, Freeport LNG must submit a complete plan and schedule of inspection to determine the full extent of damage caused by the explosion and associated fire, it said.
“After receiving and analyzing additional data in the course of this proceeding, PHMSA may
identify other corrective measures that Freeport must perform,” PHMSA said.
LNG Prime contacted Freeport LNG for a comment, but we did not receive a reply by the time this article was published.
The shutdown of the plant has affected gas prices in the US and Europe, as well as Asian spot LNG prices and LNG freight rates.
Freeport LNG, led by billionaire Michael Smith, launched commercial operations in May 2020 for the third train at its Quintana Island facility.
This event also marked the full commercial operation of Freeport LNG’s $13.5 billion, three-train facility. It has a capacity of more than 15 mtpa.
BP, Jera, Osaka Gas, SK E&S, and TotalEnergies have long-term contracts with Freeport LNG.
Freeport LNG is also planning to add another production unit with a capacity of 5 mtpa but it has not yet taken a final investment decision.