US Gulf Coast LNG bunker terminal another step closer to construction

Permit applications for building Galveston liquefied natural gas (LNG) bunker port (GLBP), a joint venture (JV) between U.S. maritime infrastructure company Seapath and Houston-based clean energy solutions provider Pilot LNG, have been submitted for state and federal approval.

These applications were filed with the United States Army Corps of Engineers (USACE) to seek authorization to site, construct, and operate the proposed GLBP small-scale natural gas liquefaction facility on Shoal Point, part of the Galveston Bay/Greater Houston port complex. The JV partners highlight that this will be the region’s first dedicated LNG bunker terminal to provide clean LNG as marine fuel, which is being increasingly adopted to reduce emissions and meet regulations, such as the International Maritime Organization’s limit on the sulfur content in the fuel oil used onboard ships, known as IMO 2020.

The proposed project includes natural gas liquids and refrigerant storage, feed gas pre-treatment facilities, a bunker vessel loading berth, and associated marine and loading facilities. The Galveston LNG terminal will comprise two natural gas liquefaction trains with a total expected capacity of 600,000 gallons per day. Divided between two phases, each train should have a capacity of 300,000 gallons per day and be accompanied by a 3-million-gallon storage tank.

“The Galveston LNG Bunker Port project continues to meet its milestones, and we are very excited to announce that the necessary permitting applications have been submitted. We are confident that we will meet the rigorous requirements of State & Local permitting authorities to ensure that the project is delivered on-time and will meet the ever-growing demand for clean fuel supply in the Galveston Bay, and US Gulf Coast region by the end of 2026,” said Shaun Davison, Chief Development Officer of Pilot LNG.

The framework agreement for the development, technical design, permitting, and marketing of the proposed liquefaction project was signed by Pilot LNG and Seapath Group in September 2023. The final investment decision (FID) – contingent upon completing required commercial agreements, acquiring necessary permits and approvals, and securing financing commitments – is expected in mid-2024, with operations slated to start in late 2026.

Joshua Lubarsky, President of Seapath Group, commented: “Our experience in developing, building and operating energy infrastructure will help us with this much-needed facility. This facility is a critical investment into the resilience of the United States’ maritime infrastructure, and upon construction will immediately provide positive environmental and economic impacts in Texas City, Galveston Bay, and the US Gulf Coast.”