The Federal Energy Regulatory Commission (FERC) has officially dropped plans for the Aguirre Offshore GasPort plan in Puerto Rico. The US agency announced its order vacating authorisation on January 28, following a decision by the project’s backer, Excelerate Energy, to back out in November.

The statement from FERC said Aguirre had filed a request to drop its 2015 authorisation, saying it “no longer intends to proceed with the project … Aguirre states that no construction has been undertaken and that no facilities are in service”.

While the Aguirre plan is not moving ahead, the island is working with New Fortress Energy on a facility at San Juan. This should be operational in the second quarter of 2019.

In July 2015, FERC gave an order authorising Excelerate, working with the Puerto Rico Electric Power Authority (PREPA), to go ahead with the Aguirre plan, off the island’s southern shore, near the Salinas municipality. The final environmental impact statement (EIS) found no significant impact from the project. At this point, construction was to have begun in the first quarter of 2016, with the facility entering service in the second quarter of 2017.

A statement at the time from Excelerate said the company had put in nearly four years of work on the review, beginning in December 2011. A PREPA official was quoted as saying the project was “critical” to reducing “the cost of energy in Puerto Rico and to reduce the emission of air pollutants”.

The project involved the installation of an FSRU and a 6.4-km subsea pipeline to move the gas onshore, replacing diesel. Feedstock would have been supplied to the Central Aguirre power complex. Baseload capacity at the FSRU was designed to be 500 mmcf (14.2 mcm) per day.

Puerto Rico effectively announced bankruptcy in May 2017, as it became unable to service its bond debts with social spending slashed. In March of that year, a restructuring of PREPA began, although the company did go on to declare bankruptcy in mid-year as a result of debts reaching US$9 billion. In September 2017, the island was hard hit by two hurricanes, which destroyed much of its power grid.

Problems had begun to accumulate before, though. The territory’s Energy Commission opted not to support the Aguirre FSRU plan in 2016. The LNG import plan had been intended to reduce fuel costs, with Excelerate officials testifying it would cut these by as much as US$25 million per month, while reducing greenhouse gases (GHGs) by nearly 30%.

The project would have cost US$552 million, of which PREPA was to be responsible for US$266 million on the fixed infrastructure, with another US$6.2 million per year on operating costs. It would also pay US$51 million per year to Excelerate in leasing costs.