LNG Market Update - Mar 2

[dan_s]

Starting in mid-2024 it is the big increase in LNG export capacity combined with not enough pipelines to take ngas from Appalachia to the Gulf Coast that will send U.S. natural gas prices a lot higher.

The Golden Age for liquefied natural gas (LNG). Forbes.

It was only a few years ago that investors in LNG were hesitant. One reason was fear that renewable energies would come on strong and new oil and gas assets might get started but then stranded. Much of Europe’s gas imports in 2022 coming from Russia were cut off by Russia. Liquefied natural gas (LNG) was a natural replacement, and countries like the US and Qatar and Australia could step up to fill the gap. The market for LNG started to explode, particularly in the US. The US is looking ahead also, and in this climate have pushed aside uncertainties about stranded gas facilities and are again investing in LNG supplies. In 2022, LNG exporters completed 45 long-term contracts to sell US gas overseas, up from 14 in 2021 and 3 in 2020. But no additional US LNG export capacity will become available until 2024. A new supply of LNG is expected to hit the market by 2026-2027, from the US and from Qatar. Export volumes and wealth from LNG could potentially lead to $100 billion in new LNG developments in the US.

Cheniere Energy is a big LNG exporter in Louisiana. In the week of February 20, 2023, the company announced it will expand its facilities in Sabine Pass. They plan to boost capacity by 20 million tonnes per annum to 50 million tonnes by adding three trains in an adjacent area, which would come online by late 2028.

Freeport LNG is one of five LNG terminals along the Gulf Coast that turned the US from a big gas importer to the world’s top exporter. Freeport has fixed problems that led to an explosion eight months ago and they will soon rejoin the market boom.

Read more here: https://www.forbes.com/sites/ianpalmer/2023/03/01/the-golden-age-for-liquefied-natural-gas-lng/?sh=4348770f78c8