Four dedicated tugboats waited seven years to do their job.
At Cheniere Energy’s $15 billion Sabine Pass LNG Terminal on the Texas-Louisiana border, the tugboats are stationed to ensure safe and timely escorts by crews trained to berth LNG vessels.
But the shale revolution left the tugboats useless. Shale gas drillers started producing enough natural gas for the country, and imports were no longer needed.
Cheniere was able to avoid financial losses on its import facilities because space was reserved by customers even if they didn’t use it. Chevron Corp. and Total SA are contracted to pay approximately $5 billion over 20 years to keep the tugboats, including crew members, and the Sabine Pass import terminal operating.
Now, the tugboats prepare for a job they never expected: escorting ships that carry exports.
The United States now produces about 80 billion cubic feet of its own gas every day. The country is set to become a net exporter next year.
Building more export terminals
Many companies are building liquefactions plants. The facilities will turn natural gas into liquid form so it can be shipped by tanker. Cheniere is using existing infrastructure to develop liquefaction services and export terminals to its Sabine Pass facility.
Cheniere plans to build at least five liquefaction facilities, a risky bet with gas prices in Asia and the United States near multi-year lows. But Cheniere is paid a capacity registration fee at its terminals regardless of the price of gas and could be well-placed to expand if the energy industry rises out of the continued slump.
So, after seven years, the tugboats finally have a job to do.