LNG demand across the world touched a record high of 360 million tonnes in 2020. Credit: SatyaPrem from Pixabay

Tellurian expects to commence construction of its $16.8bn Driftwood LNG export project in Louisiana this summer (June to August) as demand for fuel increases across the world.

Tellurian co-founder and executive chairman Charif Souki said: “I hope that we will be in construction this summer.

“There is a strong need for additional liquefaction capacity and we’re probably the project that is the closest to starting construction.”

Recent years have seen demand for the super-cooled liquefied natural gas surging from countries such as China and India, which are shifting power generation away from coal-fired power facilities.

Recent weeks have seen prices for the fuel and shipping fees increase because of cold weather in Asia, as well as bottlenecked shipments at the Panama Canal, reported Reuters.

Souki added: “The level of (customer) interest has increased pretty dramatically over the past month.”

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Several projects were slated to commence in North America, including Driftwood, over the last year, but these projects were delayed as customers were not willing to sign long-term deals required to fund the projects given that prices of natural gas dropped.

Additionally, coronavirus led to a plunge in gas prices in Europe and Asia to record lows of below $2 per million British thermal units (mmBtu) in 2020, while US gas prices dropped to its lowest in 24 years.

Souki added that ‘the system is stressed’, and that global LNG demand is on track to increase by around 200 million tonnes over the next seven years.

Last year, LNG demand across the world touched a record high of 360 million tonnes.

The first phase of Driftwood is expected to become operational in 2025.

It is expected to produce about 16.5 million tonnes per annum of LNG.