Galveston Approves Modular LNG Plant on Pelican Island with Power LNG

The Galveston Wharves Board of Trustees approved a lease and development agreement with Power LNG to build a small-scale modular liquefied natural gas production, storage and bunkering facility on Pelican Island, within the Port of Galveston. The agreement was approved at the October 8 meeting, and commercial production is expected to begin in the fourth quarter of 2028, once the necessary approvals and agreements have been obtained.

The plant will have initial capacity to produce approximately 400,000 gallons of LNG per day through two parallel liquefaction trains of 200,000 gallons per day each, with the potential to expand production to 800,000 gallons per day using modular liquefaction technology. The development will occupy 30 acres of undeveloped land on the eastern section of an approximately 82-acre port site on the Galveston deepwater port, and will include an underground pipeline to supply feedstock to the facility, an LNG storage tank with capacity for 3 million gallons, and a shore-to-ship dock to bunker both vessels and LNG fuel supply ships.

Rodger Rees, Port Director and CEO of Galveston Wharves, noted that the agreement allows the port to take a leading role in supplying cleaner marine fuels for the region, creating jobs and helping improve air quality. Rees added that, as more LNG-powered vessels are built, demand for this marine fuel is reaching a critical point, and that the facility will give Galveston the opportunity to support that growing market while diversifying port operations. For his part, Austin Terry, CEO of Power LNG, highlighted that the company will develop a comprehensive LNG supply solution that includes liquefaction, storage, bunkering, ship loading and export capabilities.

According to Maritime Executive, this would be the first LNG bunkering facility on the Gulf Coast, and it is part of Galveston Wharves' plan to develop Pelican Island, one of the few large-scale deepwater port sites still underdeveloped in Texas, where the port owns 357 acres of waterfront land, including 100 acres next to the Gulf Copper shipyard that Davie Defense is converting into a facility for building Arctic icebreakers and other projects. The port had already highlighted in early 2024 that it was one of the first in the United States to offer LNG bunkering services to vessels, a strategic advantage for attracting cruise lines such as Carnival Cruise Line and for meeting demand from container ships and tankers.

As part of the long-term development, the port and Power LNG plan to negotiate agreements for LNG and ISO tank container loading operations at a future port-owned dock adjacent to the leased property. The parties also anticipate future LNG-related activities in other port areas, including ISO container loading and export operations in sections of Pier 34 and truck-to-ship LNG bunkering in parts of Pier 39.