As U.S. LNG exporters expand plants and propose new facilities along the Texas and Louisiana coasts, an unlikely domestic bottleneck could delay capacity expansions and growth in America’s LNG exports.
Crowded waterways along the Louisiana coast, where many new projects will be located, could create constraints to shipping LNG cargoes out of the U.S. Gulf Coast, potentially undermining the Trump Administration’s strong support for boosting LNG exports.
Six LNG export projects in total are either operational or proposed along or near the Calcasieu Ship Channel, a waterway that connects the city of Lake Charles, Louisiana, with the Gulf of Mexico.
One LNG exporter, Venture Global, has an operational plant, Calcasieu Pass, on the east bank of the waterway, and plans another project, CP2 just north of it. On the west bank of the waterway, directly across Venture Global’s facilities will be another proposed export plant, Commonwealth LNG.
North of these projects is the Sempra Infrastructure-led operational Cameron LNG, 18 miles north of the Gulf of Mexico on the Calcasieu Ship Channel.
Woodside’s proposed Louisiana LNG and Energy Transfer’s Lake Charles LNG projects are planned not too far north of Cameron LNG.
The waterway is becoming crowded and has already raised concerns among operators about how they would share and prioritize access and shipping along the channel to the Gulf.
Venture Global has called on the Federal Energy Regulatory Commission (FERC) in a letter to review the proposed waterway suitability assessment of the Commonwealth LNG project.
The FERC “should ensure that the construction and planned operations of Commonwealth do not adversely impact existing LNG export terminals like Calcasieu Pass or other facilities utilizing the same or overlapping waterways,” Venture Global said in the letter carried by Bloomberg.
Venture Global expressed concerns about vessel traffic and what would happen if the channel needs to be closed to allow vessels to and from the Commonwealth LNG project.
Representatives for Commonwealth LNG told Bloomberg that its waterway suitability assessment and its Coast Guard letter of recommendations “comply with all applicable regulations.” No changes to the waterway suitability assessment are required, the company behind the project added.
Commonwealth LNG targets a final investment decision (FID) in the third quarter of this year and production start-up in the first quarter of 2029.
Yet, bottlenecks on the Calcasieu Ship Channel, with several projects competing for access and cargo shipping lanes, could constrain U.S. LNG exports later this decade if all projects begin commercial operations as planned.
Supply from America is growing with the start-up of Venture Global’s second facility, Plaquemines LNG, in Louisiana, and the commissioning of Cheniere’s Corpus Christi Stage 3 project. Both Plaquemines LNG and Corpus Christi Stage 3 achieved first gas in late December 2024 and are ramping up operations and exports throughout this year.
LNG exports from the United States have increased every year since 2016, rising from 0.5 billion cubic feet per day (Bcf/d) in 2016 to 11.9 Bcf/d in 2024, making the United States the world’s largest LNG exporter in both 2023 and 2024.
U.S. LNG gross exports are expected to further increase by 19% to 14.2 Bcf/d in 2025, and by 15% to 16.4 Bcf/d in 2026, according to estimates from the U.S. Energy Information Administration (EIA).
Developers of U.S. LNG export projects have started taking final investment decisions on new facilities this year, with several plants expected to add in 2025 to Woodside’s Louisiana LNG approval, despite rising construction costs due to President Trump’s steel and aluminum tariffs.
Developers of at least seven U.S. LNG projects have recently said that they are targeting FID on these this year. If these projects go ahead, they could triple U.S. LNG export capacity by the end of the decade, adding to projects already under construction after FIDs taken in previous years.
By Tsvetana Paraskova for Oilprice.com
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