HomeNewsUpdate: U.S. LNG natgas feedgas on track to fall to 12-wk low

Update: U.S. LNG natgas feedgas on track to fall to 12-wk low

7/17/2024

The amount of natural gas flowing to U.S. liquefied natural gas (LNG) export plants was on track to drop to a 12-wk low on Wednesday due to reductions at several plants, including Freeport LNG in Texas, according to data from financial firm LSEG.

For years, LNG feedgas has been the fastest growing source of new U.S. gas demand and the shutdown of any export plant, especially Freeport, can sway gas prices around the world.

On Monday, U.S. gas futures fell about 7% to a 10-wk low after it became clear that Freeport would not return to full service as soon as the market had previously expected.

In 2023, the U.S. exported about 11% of the gas drillers pulled out of the ground as LNG, up from just 1% in 2016, the year Cheniere Energy started operating the first big LNG export plant at Sabine Pass in Louisiana.

Gas flows to the seven big U.S. LNG export plants fell to 11.6 Bft3d so far in July due mostly to the shutdown of Freeport for Hurricane Beryl on July 7, down from 12.8 Bft3d in June and a monthly record high of 14.7 Bft3d in December 2023, according to LSEG data.

On a daily basis, LNG feedgas was on track to drop to a 12-wk low of 10.7 Bft3d on Wednesday due to the ongoing reduction at Freeport and a new reduction over the past couple of days at Cheniere's Corpus Christi plant in Texas.

The 2.1- Bft3d Freeport was on track to pull in about 0.5 Bft3d of gas on Wednesday, up from 0.4 Bft3d on Tuesday and near zero Bft3d from July 7–15. In the week before Freeport shut for Hurricane Beryl, the plant was pulling in about 1.7 Bft3d of feedgas.

The 2.4- Bft3d Corpus, meanwhile, was on track to pull in about 1.6 Bft3d of gas on Wednesday, the same as Tuesday. That is down from an average of 2.4 Bft3d during the prior seven days (July 9–15), according to LSEG data.

1 Bft3 is enough gas to supply about 5 MM U.S. homes for a day.

 

 

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