Two Gulf Coast Fracked Gas Export Projects’ Financial Investments Delayed

Brownsville, Texas - News broke earlier this week that the Final Investment Decision (FID) for two controversial fracked gas export projects proposed for the Gulf Coast, Texas LNG in Brownsville, Texas and Magnolia LNG in Lake Charles, Louisiana, have been significantly delayed due to global insecurity in the fracked gas market. 

Magnolia LNG’s FID delay shadows its previous investors' financial flounder. Glenfarne Group, who manages both projects, acquired Magnolia LNG in May from the Australian firm LNG Limited after they failed to reach any firm deals with buyers for the up to 8.8 million tons a year of LNG the facility would produce. Glenfarne previously estimated making Magnolia LNG’s FID by late 2021 but pushed their projection to 2023.

Glenfarne Group also projected making their FID for Texas LNG sometime in 2021, but has now delayed their decision to 2022. This latest delay is yet another significant roadblock for the project this year. In August 2021, Texas LNG and Rio Grande LNG - another proposed terminal for South Texas- were delayed after the Federal Energy Regulatory Commission (FERC) was ordered to revisit the projects’ inadequate Environmental Assessments, which failed to include climate change and environmental justice impacts in their analysis. Plans for Annova LNG, the third LNG export terminal proposed for the Rio Grande Valley, were ditched in March 2021 after facing similar market challenges and consistent community opposition to the project. 

If built, Magnolia LNG and Texas LNG would severely impact low-income and communities of color along the Gulf Coast that are already vulnerable to natural disasters exacerbated by climate change. In late 2020, Hurricane Laura devastated Lake Charles, Louisiana, where Magnolia LNG is proposed for construction. The Rio Grande Valley is also facing the threat of ever-increasing weather related disasters and a massive fracked-gas build out that would trample over Indigenous lands, irreparably damage delicate ecosystems and wildlife, and pollute Latinx communities.

In response, Sierra Club Senior Director of Energy Campaigns Kelly Martin issued the following statement:

“These delays in investment demonstrate once again that the environmental and economic risks associated with fracked gas make the industry persistently risky and unreliable. Glenfarne Group and other pro-fossil fuel firms want to spin fracked gas as both climate-friendly and good business, but the truth is it’s neither. There is nothing environmentally sound about fracked gas, and the industry is fiscally tenuous and will only become more so as facilities in the Gulf Coast become increasingly vulnerable to extreme weather driven by climate change.”