Dominion to keep exporting LNG during June maintenance
Dominion notified customers in a posting on its website that it would work on the plant’s “small liquefier” from June 2-15. The company said that work is unrelated to the LNG export service.
The amount of pipeline gas flowing to Cove Point has held around 0.76 billion cubic feet per day - near the plant’s capacity - since the facility exited its last maintenance outage in the middle of October, according to data provider Refinitiv.
Even though the plant is not expected to stop LNG exports in June as some traders and brokers said earlier in the week, analysts noted this is a good time for any LNG export plant anywhere in the world to shut.
The global LNG market is oversupplied due to several factors including a sharp drop in demand from coronavirus lockdowns that have caused gas prices in Europe and Asia to plunge to record lows in recent weeks.
In April, LNG buyers canceled about 20 U.S. cargoes due to be shipped in June.
Analysts said they expect even more cancellations in coming months especially now that U.S. gas at the Henry Hub in Louisiana are more expensive for June, July and August than the European Title Transfer Authority (TTF) benchmark in the Netherlands.
So far, analysts said those cancellations were at U.S. LNG plants located on the Gulf of Mexico where most gas is priced at the Henry Hub.
Gas for Cove Point, however, mostly comes from the Marcellus and Utica shale in Pennsylvania, West Virginia and Ohio, which is currently about 20% cheaper than the Henry Hub.
Reporting by Scott DiSavino; Editing by David Gregorio
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