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Jump in the Line, Part 2 - How Close is Cheniere to FID on Another LNG Terminal Expansion?

Cheniere Energy is by far the largest owner and operator of U.S. LNG capacity, with 45 MMtpa across nine liquefaction trains at two terminals: the six-train Sabine Pass facility in Louisiana and the three-train Corpus Christi terminal in South Texas. But when Sabine Pass Train 6 was placed into service earlier this year, it marked the first time since 2012 that Cheniere had no capacity under construction. The pause may not last long. With global demand for LNG super-strong and prices even stronger — the April Dutch Title Transfer Facility (TTF) contract hit a record $72.53/MMBtu on March 7 — and Russia’s invasion of Ukraine threatening future supplies of Russian gas into Europe, Cheniere may be poised to make a final investment decision (FID) on the next stage of its Corpus Christi LNG. In today’s RBN blog, we continue our series on the next wave of U.S. LNG projects with a closer look at Cheniere’s Corpus Christi Stage III.

As we’ve been saying in recent days, any discussion of global energy markets — particularly Europe’s need for more natural gas — needs to be prefaced by a pause to acknowledge the human tragedy unfolding in Ukraine. We are living through a defining moment in history, and our hearts are with those fighting to defend freedom.

Global gas prices — marked by the TTF and the UK’s National Balancing Point (NBP) in Europe and the Japan-Korea Marker (JKM) in Asia — have been on a volatile and incredibly bullish run for well over a year. The winter of 2020-21 saw what at the time was a record price spike for JKM, which flirted with $20/MMBtu in January 2021 before falling back as last winter came to a close. But prices didn’t fall far, or for long — a late-season cold snap pushed European storage inventories to their lowest levels in recent history (see Summertime), and that, coupled with rebounding global demand and extreme weather events, combined to exert upward pressure on prices through the spring, summer and fall.

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