Page 7 - NorthAmOil Week 06 2022

NorthAmOil COMMENTARY NorthAmOil

6 is already reported to be contributing record facility, also in Louisiana. Venture Global is
flows to Sabine Pass as Cheniere targets higher intending to replicate the modular technology
gas demand and prices in Europe. Bloomb- it deployed at Calcasieu Pass, but Plaquemines is
ergNEF data showed that flows to Sabine Pass anticipated to be twice the size of Calcasieu Pass,
had hit a record 5.1bn cubic feet (144.4mn cubic with a capacity of 20mn tpy.
metres) per day on both January 21 and 22. Meanwhile, Cheniere is also turning its atten-
Cheniere is not the only US LNG exporter tion to smaller-scale, modular liquefaction tech-
trying to take advantage of strong European nology for its planned Corpus Christi Stage 3
demand and prices. A separate Bloomberg expansion, which is also expected to be sanc-
report said total gas flows to US LNG terminals tioned this year.
had hit a record 13.3 bcf (376.7 mcm) per day However, the Gulf Coast is not the only region
on January 28. where momentum appears to be picking up for
Flows will increase further still as both Sabine LNG developments. Last week, Alaska Gas-
Pass Train 6 and Calcasieu Pass ramp up to full line Development Corp. (AGDC) released the
capacity. By the end of 2022, the US will have liq- findings of a new analysis by Wood Mackenzie Venture Global
uefaction capacity amounting to 13.9 bcf (393.6 into the long-planned Alaska LNG project. The
mcm) per day. analysis found that the project’s cost of supply is intending
could be reduced by 43% to $6.7 per million to replicate
What next? British thermal units ($185.32 per 1,000 cubic
The current LNG and gas market environment metres) from $11.7 per mmBtu ($323.62 per the modular
also bodes well for additional LNG export plants 1,000 cubic metres) previously. The reduction
that have been proposed for the US but have yet has been attributed to lower construction costs, technology it
to reach FID. higher LNG demand and a new finance plan for
In an update last week, Tellurian’s executive the project. deployed at
chairman, Charif Souki, said construction of the Alaska LNG remains an outlier, given the Calcasieu Pass.
company’s proposed Driftwood LNG terminal challenges of building a still-costly project in a
in Louisiana would begin in April regardless of remote region. However, Wood Mackenzie said
whether financing for the project is finalised by that even under its accelerated energy transi-
that point. Souki had previously said Tellurian tion scenarios, LNG demand was anticipated to
was confident of meeting its project financing remain resilient over the long term, up to 2050.
goals by the end of March, but subsequently The consultancy sees the widening supply gap
stated this could take a little longer. over the coming years as potentially opening up
Either way, the project appears set to be one a window for Alaska LNG from 2028.
of the next to proceed with full construction. If these trends play out, proposed new LNG
Another strong contender to begin construc- terminals on the Gulf Coast could also see their
tion soon is Venture Global’s Plaquemines LNG prospects improve further still.™

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