State-owned QatarEnergy owns a 70 percent stake in the Golden Pass project with a capacity of more than 18 mtpa and will offtake 70 percent of the capacity, while US energy firm ExxonMobil has a 30 percent share.
A joint venture of Chiyoda, McDermott, and Zachry won the EPC contract to build the tree Golden Pass trains worth about $10 billion next to the existing LNG import terminal in the vicinity of Sabine Pass, Texas.
However, Zachry Holdings said on May 21 it has filed for bankruptcy, initiating a structured exit from the Golden Pass LNG export project due to “financial challenges” related to the construction of the facility.
Golden PassLNG told LNG Prime on July 25 that it will ramp up construction activities at the LNG terminal after a bankruptcy court approved a settlement agreement with Zachry.
After that, ExxonMobil’s CEO Darren Woods said earlier this month that the JV is now expecting to start LNG production at the first Golden Pass LNG train in the second half of 2025, “a 6-month slippage” from the previous estimate.
Under the original FERC order from 2016, Golden Pass LNG was required to complete and place into service the LNG export terminal by December 21, 2021.
In response to an extension request filed by Golden Pass LNG in December 2019, FERC granted an extension of the in-service deadline until and including November 30, 2026.
Golden Pass LNG now requests that the Commission amends its prior authorizations to further extend the deadline for placing the export project facilities in service until no later than November 30, 2029, according to a FERC filling dated August 28.
The JV said this period accounts for both the delays caused by the bankruptcy filing of Zachry Industrial, “remaining schedule uncertainties related to the transition to a new lead contractor (CB&I), and other possible delays outside of GPLNG’s control that may occur such as potential hurricane impacts, and for commissioning and start-up activities.”
Golden Pass LNG noted the Commission may extend in-service deadlines for good cause which can be shown “by a project sponsor demonstrating that it made good faith efforts to meet its deadline but encountered circumstances that prevented it from doing so.”
The JV said it has proceeded “diligently to construct the authorized facilities for the export of LNG and is fully committed to completion of the construction of the project facilities and placing them in service.”
Golden Pass LNG has obtained and maintained all required permits and authorizations and has “devoted substantial resources toward expediting construction to offset the impacts on its construction timetable caused by delays due to, among other things, the Covid-19 pandemic’s impact on supply chains.”
To expedite its progress, Golden Pass LNG has sought and received authorizations to extend the weekly construction schedule to a seven-day schedule, increase the project workforce from 2,900 to 7,700 personnel, authorize peak shift construction traffic, and extend to 24 hours-a-day construction activities for certain tasks.
As a result of its efforts, Golden Pass LNG has made “substantial” progress in constructing the authorized facilities.
As of the filing of this motion, construction of Golden Pass LNG’s export project facilities is about 80 percent complete, the JV said.
Construction on Train 1, including the utility and export terminal facilities necessary to produce and load LNG, is about 83 percent complete, with construction on Train 2 about 46 percent complete, and Train 3 about 31 percent complete, Golden Pass LNG said.
Golden Pass LNG said that the current in-service deadline of November 30, 2026, will not provide sufficient time to complete the construction of the export project facilities.
An extension of the construction deadline is necessary due to “extenuating circumstances” outside of Golden Pass LNG’s control, it said.
“Despite providing Zachry with over $1 billion in additional consideration to complete the project within the September 30, 2025, deadline, Zachry began slowing its construction activities in February 2024, furloughed thousands of workers in April, then filed for Chapter 11 Bankruptcy protection in May, and terminated its entire craft work force at the site,” Golden Pass LNG said.
Golden Pass LNG said the delayed construction activities, “exacerbated by the automatic bankruptcy stay and the time required to resolve those proceedings, necessitates an additional extension of the construction completion deadline.”
The additional time will allow for the rehiring and remobilization of over 4,000 skilled workers and provide for potential uncertainties such as severe weather or hurricane delays when it may not be safe to have crews on site, Golden Pass LNG said.
Golden Pass LNG is contemporaneously filing a request with the DOE/FECM for an extension of time under both its NFTA and FTA export authorizations to start commercial operations from the LNG terminal facilities until March 31, 2027.
This extension of eighteen months would provide time to achieve commercial operation of Train 1 and account for remaining uncertainties for the project construction schedule, it said.
Trains 2 and 3 would follow sequentially thereafter, necessitating the additional time to place all of Golden Pass LNG’s authorized export facilities in-service by the November 30, 2029 deadline.
“Although GPLNG anticipates fully completing construction of the export project facilities well before November 30, 2029, GPLNG respectfully submits that allowing additional time to account for potential future uncertainties in the construction schedule would avoid the necessity of seeking yet another extension, lessen FERC’s administrative burden, and, importantly, provides certainty to GPLNG, its LNG buyers, gas suppliers, and the hundreds of contractors and suppliers working with GPLNG,” the JV said.
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