Texas LNG Project Worth $8.2 Billion to Add 7% to 9% to U.S. Exports
Key Facts
The U.S. Department of Transportation announced on October 28 that the Maritime Administration had approved ST LNG’s application for a deepwater port license to export liquefied natural gas, for a project worth $8.2 billion off the coast of Matagorda, Texas. The department said the facility could increase U.S. LNG export capacity by 7% to 9% when completed. The approval is a step in the licensing process, as Reuters reported that issuance of the license would remain contingent on the company meeting all federal and state requirements. This means the announcement does not yet resolve whether all approvals needed for the project have been completed. According to Reuters, the company is targeting a decision to proceed after securing initial purchase commitments of at least 2 million tons per year.
The port is located about 10.4 miles off Matagorda. At full capacity, the design includes 20 platforms, four floating LNG storage units and four mooring systems, along with 7.7 miles of pipelines. The project includes four gas liquefaction systems, each with capacity of 2.1 million tons per year, according to the Maritime Administration. The Department of Transportation said the offshore site is intended to keep vessel traffic away from crowded coastal areas, a stated rationale and not a guarantee of a specific operational outcome. It also said the gas supplied to the port would come from the Tres Palacios natural gas storage and trading hub and the Williams Markham gas processing facility. The existing Transco pipeline connects supply sources to the project, according to the department’s statement.
The department estimated that the project would support 2,000 jobs during construction and up to 855 permanent jobs once operational. It said the final environmental impact review took 410 days, about 3.7 years less than the historical average, equivalent to a 70% reduction in review time. Under the design, the floating storage units would use older vessels converted to store LNG. The company’s president told Reuters that this option would cost less than building LNG storage tanks on land. These elements combine offshore liquefaction infrastructure with floating storage, while commercial viability remains dependent on securing buyers and financing.
ST LNG told Reuters that it does not currently have long-term commitments from buyers, but is nearing an agreement with an integrated energy company in India as its first buyer and is in talks with companies in Europe and Asia. The company set initial purchase commitments of at least 2 million tons per year as a condition for its investment decision. Its president added that project financing would combine debt and equity, and that the company had spoken with four to six banks. He also said long-term sale and purchase agreements would enable the company to proceed with the first unit. He said Middle East disruptions are prompting some buyers to diversify suppliers, adding: "The war in the Middle East is definitely pushing people to make sure they diversify their suppliers."
The project comes as U.S. LNG exports averaged 17.4 billion cubic feet per day in the first half of 2026, up 23% from the same period in 2025, according to the Energy Information Administration. The agency attributed export growth to increased operating capacity: the Plaquemines terminal was exporting at full capacity, while six of the seven liquefaction trains at the Corpus Christi Stage 3 expansion were exporting gas in September. U.S. shipments to Asia rose by 2.3 billion cubic feet per day, or 108%, year over year in the first half of 2026. During the same period, the Japan-Korea Marker benchmark for LNG imports in East Asia averaged $15.56 per million British thermal units, its highest level in four years. The Energy Information Administration said shipping disruptions through the Strait of Hormuz in March cut 20% of global LNG supplies, most of it from Qatar.
Looking ahead to the coming months, the Energy Information Administration forecast that U.S. exports would average 17.3 billion cubic feet per day in the second half of 2026, then rise to 18.7 billion in the first half of 2027. The Department of Transportation said construction is expected to begin in 2027 and the port to start operating in 2029. But the company’s president told Reuters that commercial operations are expected by mid-2030, a different timeline from the service start date announced by the department. The company’s president is targeting a decision to proceed with the project after securing initial buyer commitments, while issuance of the license remains conditional on completion of government requirements. The Maritime Administration also noted that a favorable record of decision does not always lead to a license being issued, since an application may be withdrawn, canceled or amended before it is completed.