Page 15 - GLNG Week 24 2022
P. 15

GLNG                                           AMERICAS                                               GLNG


       Fire at Freeport LNG disrupts




       supplies, causes gas price decline




        PRICES           US natural gas prices dropped this week while  from the US last month went via Freeport LNG,
                         prices in Europe rose following an explosion and  which is one of seven LNG export terminals in
                         fire on June 8 at the Freeport LNG terminal in  the country. With more shale gas now routed
                         Texas, which is expected to keep the plant closed  into US storage, the already strong competition
                         for a minimum of three weeks.        between Asia and Europe for gas is expected to
                           As a result of the closure supplies for Europe  intensify.
                         and Asia will be reduced while more shale gas   The outage comes at the start of summer in
                         will be routed into US storage caverns. US gas  the northern hemisphere, when demand from
                         futures sank 6.4% on June 8, while Dutch futures  power stations traditionally rises owing to
                         climbed 10%.                         increased use of air conditioning.
                           Prior to the fire at the terminal, located in   It is expected that LNG buyers will now likely
                         Quintana about 65 miles (105 km) south of  begin searching for replacement shipments from
                         Houston, prices in Europe had fallen to a three-  the spot market, although traders in Asia told
                         month low, partly on expectations for increased  Bloomberg that supply was tightening.
                         supplies from the US.                  Freeport LNG receives roughly 2bn cubic feet
                           The fire was reported to have been brought  (57mn cubic metres) per day of gas, equivalent to
                         under control the same day it broke out, and  about 16% of total US LNG export capacity. The
                         an investigation into the incident has been  facility has the capacity to produce around 15mn
                         launched. A force majeure has been issued to  tonnes per year (tpy) of LNG and supplies gas to
                         buyers with shipments scheduled till at least June  BP and TotalEnergies in Europe, in addition to
                         30, Bloomberg cited traders with knowledge of  Japan’s JERA and Osaka Gas and South Korea’s
                         the matter as saying.                SK E&S.™
                           Close to one-fifth of all shipments of LNG



















































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