U.S. LNG feedgas remains strong, with every terminal except Freeport, operating at or above full- utilization levels last week. Freeport Train 1 tripped on October 21 due to an issue at the pretreatment facility. The trains were restarted the same day, but the restart caused feedgas to the terminal to drop over the weekend. In early October, Freeport filed a request with the Federal Energy Regulatory Commission (FERC) seeking authorization to bring additional facilities online at the terminal, including the second marine berth, but FERC has not yet responded. Freeport went offline in June 2022 following an explosion and was shut for more than seven months before receiving regulatory clearance to restart in February. Most of the terminal was brought back online by April, but the final pieces of equipment and Freeport’s ability to produce peak LNG are still pending regulatory approval for a restart. In the meantime, Freeport feedgas has been somewhat volatile and the terminal has filed multiple flaring incidents with Texas state regulators over the past few months. This was also the case for Freeport prior to the explosion, but no other terminals in the U.S. have experienced so many unplanned restarts.
Featured Articles
Shut Down - Gas Flow, Price Impacts of the Freeport LNG Outage
An explosion June 8 at Freeport LNG, the 15.3 MMtpa (2 Bcf/d) export terminal on Quintana Island, TX, has knocked it offline at a time when the global market is already facing tight conditions because of the war in Ukraine and other factors. The explosion, fire and subsequent shutdown — which fortunately did not include any injuries — sent U.S. natural gas tumbling off recent highs and shot global gas prices higher. Much is still unknown about the developing situation, including exactly how long the outage will last. While Freeport has said it expects the terminal to be offline for at least three weeks, multiple regulatory agencies have investigations underway and will likely need to approve a return to service. In today’s RBN blog, we look at the latest news from Freeport LNG and run through the potential market implications, starting with impacts to the U.S. gas market.
Dizzy - U.S. LNG Feedgas Volumes Swing Wildly Ahead of Peak Winter Demand
Total U.S. LNG export capacity is around 12 Bcf/d, including the still-commissioning-but-nearly-complete Calcasieu Pass. About 13.5 Bcf/d of U.S. natural gas supplies, or feedgas, is required to produce that much LNG, but feedgas demand has averaged just 10.5 Bcf/d over the past week despite still-soaring global gas prices and an undersupplied global LNG market. Two U.S. terminals are currently offline: Freeport LNG, which has been out of service since an explosion and fire in June, and now Cove Point LNG, which shut for annual maintenance October 1. Beyond those outages, which have taken about 2.75 Bcf/d of demand out of commission, LNG feedgas volumes have been extremely volatile, swinging as much as 2 Bcf/d within a week. Don’t expect this to last, however — with winter approaching, the return of both Freeport and Cove Point on the horizon, and the full startup of Calcasieu Pass in sight, feedgas demand will likely rise to new heights and soon consistently top 13 Bcf/d. In today’s RBN blog we take a closer look at the recent volatility in LNG feedgas and the potential demand coming this winter.
Feed Me - U.S. LNG Feedgas Demand Has Additional Upside Beyond New Capacity
LNG feedgas demand has averaged a record of about 12 Bcf/d this summer and fall. While that may sound like an impressive number (and it is), it could increase significantly — even without new capacity additions — over the next few months as seasonal demand rises and maintenance activity slows. And that’s just for starters. Next year, the first of several planned LNG export terminals and expansions of existing ones will start commissioning, and by the end of this decade feedgas demand may well double. In today’s RBN blog, we look at how current LNG feedgas demand stacks up compared to past years, the factors driving current demand, and the potential for additional upside.
