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Freeport LNG sues three contractors over defects at Texas plant
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Freeport LNG sues three contractors over defects at Texas plant
Jun 6, 2024 11:26 AM

June 6 (Reuters) - U.S. liquefied natural gas (LNG)

exporter Freeport LNG filed a lawsuit in April against three

contractors, alleging that installation defects in electric

motors at its $14-billion Texas export plant caused prolonged

outages and costly repairs.

The lawsuit, filed in a Texas district court, alleges that

work done by contractors Zachry Industrial, Chiyoda

International, and CB&I, a unit of McDermott

, resulted in major damage to key equipment.

Freeport's Quintana, Texas, facility has experienced roughly

a dozen incidents so far this year. The plant can produce more

than 15 metric tonnes per annum of LNG and consume roughly 2.1

billion cubic feet per day of natural gas, enough to roil gas

markets when it goes offline.

Freeport LNG declined to comment. Chiyoda and Zachry did not

immediately respond to requests for comment and CB&I did not

immediately provide a comment.

Zachry Holdings filed for bankruptcy last month and stepped

away from work on the Golden Pass LNG plant, owned by Exxon

Mobil ( XOM ) and QatarEnergy, that is under construction in

Texas.

All three firms had been contracted to work on Golden Pass.

The Freeport LNG plant was converted from an import facility

roughly 15 years ago as the U.S. shale revolution flooded the

country with natural gas. It is the first world-scale

electric-powered LNG plant in North America, with three trains

running on General Electric ( GE ) 75-megawatt motors.

Problems with the motors were identified following an

incident in January, according to the lawsuit. A root cause

analysis of the incident found an electrical short resulting

from loose assembly hardware, including nuts and bolts.

A further investigation found additional issues related to

the motors, including a "significant partial discharge" due in

part to excessively long cables.

Freeport inspected Train 1 and 2 after identifying problems

with Train 3's motors and further halted some operations.

Additional workmanship issues were found on Train 2, the lawsuit

said.

Freeport did not specify how much it was seeking in damages

in the lawsuit, but said that the amount was over $1 million.

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