Energy Prospectus

U.S. Approaching Net Exporting Of Gas, Driven By Shale and LNG. Oil & Gas 360.
The U.S. unconventional boom has fundamentally changed the natural gas supply situation in the U.S. with plentiful gas easily available. This has changed not only the nation’s gas markets, but the world’s. Once a major gas importer, the U.S. is now poised to be a net exporter of natural gas. Seaport Global outlined U.S. gas production, consumption and exports in a report released today. In January, export volumes were 93.51% of import volumes, only slightly below an all-time high of 97.96% in December. Historically, the U.S. has imported far more than it has exported. From 1973, the first data available from the EIA, through 2000, U.S. export volumes were just over 6% of import volumes. While exports started to increase in 2001, they began growing rapidly in 2008. In the eight years since then, export volumes have grown from one fifth of imports to nearly equal import volumes.

Slide 10 of my March 30 podcast (available on the EPG website home page) shows:
> LNG exports increasing by 7.6 Bcfpd from 2017 to 2020
> Exports to Mexico via pipeline increasing by 2.2 Bcfpd from 2017 to 2020. < My guess is that actuals will be much higher for Mexico.

Cheniere announced the departure of the 100th LNG cargo from its Sabine Pass facility on Saturday, itself a key checkbox for U.S. energy exportation.

Averaging one shipment every 4 days

Since the first shipment on February 24, 2016, Cheniere has averaged about one shipment every four days. Shipments have been accelerating, though, as 44 of these cargoes have been shipped in 2017. In total, cargoes have been delivered to 18 countries on five continents.

Commenting on the 100th departure, Cheniere President and CEO Jack Fusco said “this milestone for Cheniere is a testament to the global demand for American LNG, the hard work and dedication of Cheniere’s workforce, and our unique business model that enables customers large and small to access this fuel.”

Cheniere also announced on March 31 the substantial completion of Train 3 of the Sabine Pass project. Commissioning is complete and Bechtel, the constructor, is turning over control of Train 3 to Cheniere Partners.

The first delivery for Cheniere’s Train 3 will occur in June 2017 to Korea Gas Corporation.

A total of six trains will be built in the Sabine Pass facility. In addition to the release of Train 3, Trains 1 and 2 are currently operational. Train 4 is in the commissioning process and Train 5 is under construction. Train 6, the final train planned, is fully permitted and is currently being commercialized.

Each train has a designed capacity of just under 600 MMcf/d, giving the facility a capacity of 3.55 Bcf/d. Currently Cheniere has entered into six third-party LNG sale and purchase agreements totaling just under 2.6 Bcf/d.

Other LNG export projects in the works, some slated to ship out U.S. gas in 2018

Among proposed LNG facilities are Sempra Energy’s (ticker: SRE) Cameron LNG terminal. Cameron LNG’s export facility is planned for the Calcasieu Channel in Louisiana—the same channel where Tellurian’s (ticker: TELL) Driftwood LNG facility, now in planning and approval stage, will be built once it is fully approved. Tellurian is another LNG project spearheaded by former Cheniere founder Charif Souki.

Cameron LNG has 2.12 Bcf/d of capacity currently under construction at its Gulf coast facility, with an additional 1.41 Bcf/d awaiting approval. The three trains currently under construction are expected to come online in 2018, with the expansion coming online in 2019.

Tellurian’s Driftwood LNG LLC submitted its formal application with the Federal Energy Regulatory Commission (FERC) for its 26 million tonnes per annum (mtpa) export facility today. Tellurian said it expects to begin construction of the Driftwood LNG project in 2018 and produce first LNG in 2022, with full operations beginning in 2025.

Venture Global LNG has two projects in progress, the Calcasieu Pass and Plaquemines terminals. Located in Louisiana, these facilities have a combined 4 Bcf/d of liquefaction capacity planned. The Calcasieu Pass facility is expected to begin construction in mid-2017, while Plaquemines will start construction about one year later.

There are several additional planned U.S. LNG facilities in various stages:

Dominion Energy’s Cove Point LNG facility in Cove Point, Maryland, is scheduled to bring one train totaling 0.82 Bcf/d online near the end of 2017.

Corpus Christi LNG, another Cheniere project, is under construction in Corpus Christi, Texas. The terminal is scheduled to begin service in 2018, with total permitted capacity at 2.96 Bcf/d

Freeport LNG’s terminal planned for Freeport, Texas, has three trains under construction totaling 1.8 Bcf/d. The first is scheduled to begin service in 2018, and the second and third in 2020.