2019-07-09 16:50:00
U.S. LNG DEMAND UP
PLATTS - US LNG feedgas demand is trending near record-high levels this month as newly minted liquefaction facilities along the Gulf Coast continue to ramp up, despite narrow margins for export profit.
In July, gas demand from the six operational US export facilities has averaged nearly 6.2 Bcf/d.
Demand hit a single-day record high just below 6.4 Bcf/d on July 4 and was estimated at just under that level Monday, data compiled by S&P Global Platts Analytics shows.
The more-than-600 MMcf/d increase in feedgas demand since last month comes principally from an uptick in liquefaction at Cameron LNG Train 1 and Cheniere Energy's Corpus Christi Train 2.
Cameron exported it's first cargo -- the 3.9 Bcf Marvel Crane delivered to Spain -- on May 31 and continues to move closer to commercial service at Train 1, expected later this month or possibly in August.
At Corpus Christi, the startup of LNG production at Train 2 in early June has seen feedgas demand there climb sharply over the past several weeks. In July, flows to the two-train facility have averaged nearly 1.2 Bcf/d, or at about 85% of its current nameplate capacity.
While feedgas flows to Freeport LNG's Train 1 have remained at zero in recent weeks, steady demand from Sabine Pass, Cove Point and Elba Island has lifted total US LNG export demand to record highs recently, despite historically narrow margins for profit.
NETBACKS
As incremental supplies of US LNG continue filtering onto the global market, exporters are facing narrow margin for profit amid a sustained rout in global gas prices.
In Northeast Asia, the prompt-month Platts JKM is now hovering just above a three-year low -- the index was assessed Monday at $4.26/MMBtu. Forward-market valuations show weaker prices continuing.
Physical supply for September is now trading in the low-$4s/MMBtu, while swaps for October and November are still priced below $5/MMBtu and $6/MMBtu, respectively, S&P Global Platts data shows.
In Europe, prompt supply at the UK National Balancing Point and at the Dutch TTF is also trading near multi-year lows in the upper $3/MMBtu area.
According to Platts Analytics, the weighted-average netback value on a US LNG export cargo shipped to the highest-priced global import market is averaging just 14 cents/MMBtu this month. The netback, or profit calculation, includes the cost of feedstock gas, onshore transport, shipping and related fees but excludes sunk costs associated with liquefaction.
From Sabine Pass, the margin on cargoes shipped to the JKM market actually turned negative last month. On Monday, the netback was estimated at just 38 cents/MMBtu.
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Earlier:
2019, July, 1, 11:35:00
RUSSIA, JAPAN IN ARCTIC LNG 2
in the presence of the President of Russian Federation Vladimir Putin, and the Prime Minister of Japan Shinzo Abe, PAO NOVATEK and the consortium of Mitsui & Co and Japan Oil, Gas and Metals National Corporation JOGMEC signed the Sales and Purchase Agreement to purchase a 10% participation interest in the Arctic LNG 2 project.
2019, July, 1, 11:30:00
U.S. GAS PRODUCTION UP 12%
In April 2019, for the 24th consecutive month, dry natural gas production increased year to year for the month. The preliminary level for dry natural gas production in April 2019 was 2,708 billion cubic feet (Bcf), or 90.3 Bcf/d. This level was 9.8 Bcf/d (12.2%) higher than the April 2018 level of 80.4 Bcf/d.
2019, June, 25, 12:45:00
GAS DEMAND WILL UP 46%
Dr. Sentyurin also highlighted that - according to the Forum’s projections - by 2040, the demand for natural gas is expected to increase at an annual average pace of 1.7%, corresponding to overall growth of 46%. Most of this demand growth will come from the Asia-Pacific region, with Europe continuing to be an attractive market for many gas producers.
2019, June, 20, 17:30:00
LNG RISKS UP
Around $200 billion in projects across the globe from Australia to the United States are racing to be approved over the next two years, vying to provide around 65 million tonnes of new annual supplies that are needed by 2025, according to estimates by consultants Wood Mackenzie.
