Floating LNG terminal gets thumbs-up

ChevronTexaco may get a jump on other gas producers competing in the lucrative US market after receiving final approval to build a large offshore liquefied natural gas (LNG) terminal in the Gulf of Mexico.

The company plans to locate the $800 million terminal about 40 miles off the shores of Louisiana and is currently seeking approval from the Maritime Administration of the U.S. Department of Transportation in order to begin construction by 2004.

Named Port Pelican the terminal will be the first natural gas deepwater port in the world and will put condensed natural gas back into its gaseous form before feeding it into a pipeline connected with other onshore pipelines.

While LNG has become increasingly popular as a alternative fuel across Asia analysts are now predicting that the liquefied gas, which has traditionally met just about 1% of total U.S. gas demand, could meet up to 10% of total U.S. gas use by the end of the decade.

The project is expected to begin commercial service in 2007.