Page 5 - NorthAmOil Week 05 2023
P. 5
NorthAmOil COMMENTARY NorthAmOil
More liquefaction
capacity is under
construction in the US.
carbon capture and storage [CCS] project.” Nex- Asian companies committed to purchasing
tDecade is currently targeting FID on the first 1.8bn cubic feet (51 mcm ) per day of the vol-
three trains of the project in the first quarter of umes contracted with these US LNG projects
2023. last year. Companies in Europe committed to
buying 1.2 bcf (34 mcm) per day, and companies
Building on momentum with trading affiliates – which would be more
The newly announced deals build on the likely to deliver LNG cargoes to multiple desti-
momentum experienced by the US LNG indus- nations – committed to purchasing 3.0 bcf (85
try last year as buyers scrambled to lock in sup- mcm) per day.
plies amid rising LNG spot prices and market The EIA noted, citing Cedigaz data, that
volatility. According to the US Energy Informa- because of the Ukraine war, Europe had
tion Administration (EIA), in 2022 SPAs were increased its LNG imports by 66%, or 5.9 bcf
signed for US LNG from eight projects, totalling (167 mcm) per day in 2022 compared with
about 170mn cubic metres per day. Two of the 2021. The agency pointed to reduced pipeline
projects are already under construction, four gas deliveries from Russia and record prices at
have received regulatory approval but have not European trading hubs. Europe will be able to
yet reached FID and two are still only proposals receive 34% more LNG in 2024 compared with
at the pre-approval stage. 2021, by expanding its import capability, said The newly
Those under construction are Cheniere Ener- the EIA.
gy’s Corpus Christi Stage 3 and Venture Global According to BloombergNEF, the US’ export announced
LNG’s Plaquemines facility. The approved pro- capacity will eclipse Qatar’s by 2027. “The US deals build on
jects are Delfin Midstream’s Delfin LNG, Energy will become more of a global gas player,” said
Transfer’s Lake Charles LNG, Port Arthur Phase BloombergNEF’s lead US gas analyst, Enri- the momentum
1 and Rio Grande LNG. The proposed but yet- que Gonzalez. “Unlike in the past, prices in its
to-be-approved projects are Venture Global’s domestic gas market will be more connected experienced
CP2 LNG and the Commonwealth LNG pro- with the rest of the world,” he added.
ject, being developed by a company of the same The US’ export capacity is expected to reach by the US LNG
name. 169mn tpy by 2027, according to the research industry last year.
Around 74% of the SPAs signed in 2022 are provider. “The US is in the lead because of its
for 20-year terms beginning when the pro- flexible contract terms and the competitive
jects in question begin commercial operations. landscape of project developers,” said Bloomb-
The earliest start date among them would be ergNEF’s global LNG specialist, Michael
2024. Additionally, 92% of the SPAs are for Yip. Roughly 89% of total LNG SPAs in 2022
LNG cargoes that would be sold on a free-on- involved offtake from US-based projects,
board (FOB) basis, with the buyer paying for according to BloombergNEF.
and receiving the LNG involved at the loading Given these trends, and the fact that global
terminal. supply remains tight for now, US LNG produc-
Buyers are considered likely to deliver the ers are well-positioned to announce more SPAs
LNG they purchase to their domestic markets. as the year progresses.
Week 05 02•February•2023 www. NEWSBASE .com P5
