Developers scrap Florida’s only LNG project as shale boom sinks demand

By JONATHAN N. CRAWFORD
Bloomberg

A proposed liquefied natural gas (LNG) import project in Florida has become a casualty of a boom in domestic production that is poised to see the US become an exporter of the power plant fuel by 2017.

Port Dolphin Energy is abandoning plans for a 1,200 million cubic feet/day port in Manatee County and has asked the Federal Energy Regulatory Commission to vacate its permits, according to a filing with the agency on Friday.

The LNG plant, designed to serve Florida’s Gulf Coast, was scrapped for a lack of buyers and “catastrophic changes” in market fundamentals, the company said.

"Since the inception of Port Dolphins’ plan for the deepwater port, the natural gas industry has substantially changed," the company, a unit of Leif Hoegh Co. Limited of Bermuda, said in the filing. "These changes resulted in the United States becoming an exporter rather than an importer of natural gas."

Under the proposal, imported LNG would be converted to gas in a vessel off the Florida coast, then shipped to land by an undersea pipeline, according to the company’s website.

Gas at the benchmark Henry Hub in Louisiana has fallen by two-thirds since Port Dolphin applied for federal approval of the project in April 2007.

Prospects for Florida’s only liquefied natural gas (LNG) import facility crumbled as booming domestic supplies are poised to turn the US into a net exporter of the fuel by 2017, according to US Energy Information Administration.

Florida and the southeastern US are also expected to see a jump in natural gas supplies from new pipeline projects. Pipelines capable of carrying as much as 2.1 billion cubic feet/day, or about 17% of the region’s demand, are scheduled to begin service by the end of the year, according to Bloomberg New Energy Finance.

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