European LNG sendout remains strong
London, 3 July (Argus) — European LNG sendout rose on the year in June, but dropped from its highs in April-May.
The year-on-year hike was driven by strong demand in southern Europe. Italian and Spanish LNG imports were higher than a year earlier, as PSV and PVB front-month markets opened a premium to northeast Asian prices.
Deliveries to Italy under the regulated LNG storage and regasification service also helped boost sendout from previous years.
But northwest European LNG receipts and sendout were slow. South Hook received just one cargo last month, and overall UK regasification would have been close to its lowest in recent years if Dragon had not raised regasification to clear space for a delivery late in the month.
And French LNG imports slowed in June after driving much of the increase during the spring. But this was partly because of maintenance, with Fos-sur-Mer regasification capacity restricted on 19 June-9 July and further constraints planned for 17-21 July.
Montoir sendout also dropped in June after climbing in May to the highest since November 2011, while Dunkirk regasification fell.
Gate sendout was slightly higher than a year earlier, but slowed after rising to a record high in May, when the terminal received three cargoes. The one delivery last month was more than offset by a reload on a slightly larger vessel.
Overall European sendout was still the highest for June since 2012, despite dropping from previous months. LNG imports typically peak in spring, after the northern hemisphere winter, but before cooling demand in premium markets in northeast Asia rises in June-August.
Rising global liquefaction capacity has boosted deliveries to Europe, especially with Egyptian import demand falling this year after the start-up of new fields.
PSV and PVB prices above northeast Asia $/mn Btu
European LNG sendout remains quick in June TWh/d