Freeport LNG Receives FERC Authorization for LNG Terminal Expansion

Freeport LNG Development, L.P. has received Federal Energy Regulatory Commission (FERC) authorization to expand the capacity of its liquefied natural gas (LNG) receiving terminal from 1.5 billion cubic feet per day (Bcf/d) to 4 Bcf/d.

Freeport LNG commenced construction on the LNG receiving terminal in January 2005. Located on Quintana Island, Texas, initial start-up of the 1.5 Bcf/d facility is targeted for early 2008. In May 2005, Freeport LNG submitted an application to the FERC seeking authorization to expand the terminal's capacity to 4 Bcf/d. The expansion of the facility will include an additional LNG vessel berth, LNG tank storage, and vaporization capacity. Freeport LNG, is also planning to construct a 7.5 bcf underground storage cavern at Stratton Ridge which will be integrated into the operations of the terminal.

Michael Smith, Chairman and CEO of Freeport LNG Development, L.P. said: "We would like to thank the FERC for working with us through this entire process. As we move towards completion of the first phase of the terminal, this authorization of our expansion plans will provide us greater flexibility in responding to continued demand for US receiving terminal capacity."

The first phase of the terminal consists of two (2) 160,000 cubic meter LNG storage tanks, 1.75 bcf/d of vaporization capacity (including peaking), and one berth capable of unloading LNG vessels up to 260,000 cubic meter in capacity. Construction of the first phase is nearly 60% complete, and the capacity has been sold on a long-term basis to ConocoPhillips (1 bcf/d) and The Dow Chemical Company (0.5 bcf/d).

Freeport LNG has already sold a portion of the expansion capacity. In January, 2005 it signed a 17 year Terminal Use Agreement with Mitsubishi Global Gas Corporation for 0.15 bcf/d plus an option on an addition 0.1 bcf/d.


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