Firms make deals to boost LNG exports 60% from U.S., Canada, Mexico

Posco International

23/08/2022 17:16

By Scott DiSavino
    NEW YORK, Aug 23 (Reuters) - North American liquefied
natural gas (LNG) developers and producers this year have struck
deals to sell 48 million tonnes of LNG, which will eventually
pump up exports 60% from current levels, although much of the
output remains years away.
    LNG demand is soaring as the conflict in Ukraine pushes
global prices to their highest in at least 14 years. Buyers in
Europe have looked West in a move away from Russian gas, and
Chinese buyers are striking long-term deals after a pause. 
    New gas-export plants are being developed across the United
States, and Mexico and Canada are poised to join as significant
gas exporters, with plants proposed for their west coasts.
 urn:newsml:reuters.com:*:nL1N2ZV17R
    Eight North American LNG export terminals are under
construction and over a dozen more could receive financial
greenlights by 2023. Some buyers have locked in supplies from
plants that have not yet been approved for construction, so not
every supply agreement may go ahead.
    "The dynamics have shifted," said Charlie Riedl, executive
director for trade group Center for Liquefied Natural Gas.
"Buyers are trying to lock up firm agreements where they can
(to) guarantee that gas is going to be delivered," he said.
    For a factbox on North American LNG export plants, see
 urn:newsml:reuters.com:*:nL1N2ZV1N5
    This week, European gas prices hit $84 per million British
thermal units (mmBtu) and U.S. gas futures on Tuesday topped $10
per mmBtu for the first time since 2008.  urn:newsml:reuters.com:*:nL4N2ZY2VT 
    
    'LONG-TERM ROLE'
    Goldman Sachs forecasts global LNG demand to rise about 12%
424 MTPA next year and expects new plants that will supply 156
MTPA to be approved within the next five years. 
    Growing demand has made the United States this year's
largest LNG exporting nation during the first six months.
Approved projects that are expected to begin shipments between
2023-2026 could keep the country in first place.
    "It is important for the United States to supply the market
to support allies in Europe and Asia and improve the ability of
the developing world to access gas," said Mike Sabel, Venture
Global LNG's chief executive. His firm has entered into
agreements to sell 18.5 MTPA of LNG since last September.
    Some of the biggest deals are from Chinese firms returning
to the U.S. market after a pause over tariff disputes. Late last
year, Venture Global LNG struck deals for 11 MTPA with units of
China's Sinopec and CNOOC Ltd. China's ENN Natural Gas Co
 600803.SS  signed separate deals last year with Cheniere Energy
 LNG.N  and Energy Transfer  ET.N . 
    Due to the lack of available capacity, some recent deals
have involved facilities whose construction have not yet 
received financial approvals. Those agreements "reinforce our
conviction in the long-term role" for LNG in global energy
markets, said Tim Wyatt, a Cheniere senior vice president.  
    For a factbox on recent North American LNG deals, see
 urn:newsml:reuters.com:*:nL1N2ZV1ZB
    But rising demand has led to construction of three new U.S.
export projects and several more could be approved in 2023.
    "The global energy crisis has been years in the making due
to significant underinvestment," said Octavio Simoes, CEO of
Tellurian  TELL.A , which recently started construction on its
long-delayed plant in Louisiana.
    
    TOP EXPORTERS 
    In 2021, top LNG exporters were Australia at 78.5 MTPA,
Qatar at 77.0 MTPA, the United States at 67.0 MTPA and Russia at
29.7 MTPA, according to the International Gas Union (IGU), an
industry group.
    The United States, with vast reserves of shale gas, is on
track to produce a record 85 MTPA of LNG this year, according to
U.S. government projections.  urn:newsml:reuters.com:*:nL1N2ZL1IU
    About 68% of U.S LNG exports went to Europe during the first
half of 2022 versus just 35% in all of 2021, according to data
provider Refinitiv.  urn:newsml:reuters.com:*:nL1N2Z11YN  urn:newsml:reuters.com:*:nL1N2YO2L7
    There are four export plants under construction in the
United States that will boost the nation's capacity to produce
LNG from 104.6 MTPA now to 156.3 MTPA in 2026.
    In addition, two export plants are under construction in
Canada and two in Mexico that will add another 20.8 MTPA to
North America's LNG production once all of the facilities enter
service by 2027.

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Venture Global to commission all blocks at Louisiana Calcasieu
LNG plant     urn:newsml:reuters.com:*:nL1N2YP1W2
ANALYSIS-U.S. LNG exports to Europe on track to surpass Biden
promise     urn:newsml:reuters.com:*:nL1N2Z11YN
FACTBOX-Could the U.S. ship more LNG to Europe?     urn:newsml:reuters.com:*:nL1N2YO2L7
UPDATE 1-Energy Transfer to sell LNG to China's ENN   
 urn:newsml:reuters.com:*:nL3N2VW3EG
Venture Global says Shell to buy LNG from Louisiana Plaquemines
plant     urn:newsml:reuters.com:*:nL2N2VA00Q
UPDATE 2-Chevron taps into LNG boom with Cheniere, Venture
Global deals     urn:newsml:reuters.com:*:nL4N2Y92B1
UPDATE 4-Canada's Enbridge to invest $1.5 bln in Pacific
Energy's Woodfibre LNG project     urn:newsml:reuters.com:*:nL4N2ZA3D6
UPDATE 1-Chesapeake eyes sale of south Texas shale oil assets,
focuses on gas     urn:newsml:reuters.com:*:nL1N2ZF19W
Cheniere Corpus Christi Stage III and ARC Resources Sign
Long-Term Integrated Production Marketing Transaction   
 urn:newsml:reuters.com:*:nBw9YqMcpa
UPDATE 1-U.S. natgas output to hit record highs in 2022 - EIA   
 urn:newsml:reuters.com:*:nL1N2ZL1IU
UPDATE 3-Nord Stream 1 pipeline to shut for three days,
increasing pressure on Europe     urn:newsml:reuters.com:*:nL1N2ZV17R
FACTBOX-North American liquefied natural gas export projects   
 urn:newsml:reuters.com:*:nL1N2ZV1N5
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 (Reporting by Scott DiSavino; Editing by David Gregorio)
 ((scott.disavino@thomsonreuters.com; +1 332 219 1922; Reuters
Messaging: scott.disavino.thomsonreuters.com@reuters.net))