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Viewpoint: US LNG export capacity to double next year

  • : Natural gas
  • 18/12/27

US nameplate LNG export capacity will likely double by the end of 2019 to 55.7mn t/yr, equivalent to 7.6 Bcf/d (8bn m³/yr) of gas, as all six facilities comprising the first wave of US LNG export projects are scheduled to come on line.

That would make the US the world's third-largest LNG export capacity holder behind Australia at 86.5mn t/yr and Qatar at 77mn t/yr. US peak capacity will likely reach 65mn t/yr by the end of 2019, up by 111pc on the year, but such production is not likely to be sustained over an entire year as it would require long-term ideal conditions, including weather. Nameplate capacity is what a facility expects to produce in the long term with average maintenance and weather, but daily production will fluctuate at higher and lower levels.

US gas production is expected to keep up with higher demand for LNG production and pipeline exports to Mexico. The US Energy Information Administration recently estimated that domestic dry gas production would rise to an average of 90 Bcf/d next year, from 83.3 Bcf/d this year.

Nameplate US LNG export capacity so far this year has grown by 54pc from 2017 to 27.8mn t/yr, while peak capacity also has increased by 54pc to 30.8mn t/yr.

Dominion's 5.25mn t/yr Cove Point LNG facility in Maryland started operations in March and Cheniere Energy's 4.5mn t/yr Corpus Christi LNG train 1 in Texas exported its first cargo on 11 December.

Cheniere previously said its 4.5mn t/yr Sabine Pass LNG train 5 in Louisiana likely would export its first cargo this month.

The second 4.5mn t/yr train at Corpus Christi is expected to start long-term operations in the second half of 2019.

Midstream company Kinder Morgan this month said the 10 small liquefaction trains at its Elba Island LNG export project in Georgia would come on line in phases from the first quarter to the fourth quarter of 2019. That would be a slight delay from the previous schedule of the fourth quarter this year to the third quarter of 2019. The units would have total nameplate capacity of 2.5mn t/yr and peak capacity of 4mn t/yr.

Sempra has said the three trains at its 12mn t/yr Cameron LNG project Louisiana would start operating sequentially next year.

The first of three 4.4mn t/yr trains being completed at the Freeport LNG plant in Texas is expected to start service in September, while trains 2 and 3 would come on line in 2020.

Next year could also see funding of some facilities that would be part of a so-called second wave of US LNG export capacity expected to come on line in the early to mid-2020s. Some of the companies that have said they plan to make positive investment decisions next year are Cheniere for its 4.5mn t/yr Sabine Pass train 6 and 9.5mn t/yr mid-scale train expansion at Corpus Christi; Tellurian for its $15.2bn, 27.6mn t/yr Driftwood LNG project in Louisiana; Venture Global for its $4.5bn, 10mn t/yr Calcasieu Pass LNG facility in Louisiana; NextDecade for its 27mn t/yr Rio Grande LNG project in Texas; Annova LNG for its planned $3bn, 6mn t/yr facility in Texas; Liquefied Natural Gas Limited for its for its $4.35bn, 8mn t/yr Magnolia LNG project in Louisiana; and Texas LNG for the $1bn-$1.2bn, 2mn t/yr initial phase of its project in that state.

Sempra plans to fund construction late next year of its 2.5mn t/yr first-phase Energia Costa Azul LNG export project in northwest Mexico, which would use US feed gas.

US gas production growing with LNG demand Bcf/d

Growth in US LNG capacity, 2016-19 mn t/yr

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24/12/05

Australia’s Woodside inks Bechtel EPC for Louisiana LNG

Australia’s Woodside inks Bechtel EPC for Louisiana LNG

Sydney, 5 December (Argus) — Australian independent Woodside Energy has signed an engineering, procurement and construction (EPC) contract with US engineering firm Bechtel for its Louisiana LNG terminal located in the US Gulf region. Bechtel has maintained operations at the partially constructed site since Woodside took over the project in October, after acquiring US LNG developer Tellurian , with works to continue subject to a limited notice to proceed under contract revisions, Woodside said. The Louisiana LNG foundation development comprises phases 1 and 2, which total 16.5mn t/yr capacity across three trains. Originally named Driftwood, Louisiana has permitting for a total five-train, 27.6mn t/yr capacity, with a final investment decision (FID) for phase 1 planned for January-March 2025. "In a short period of time, we have completed the acquisition, secured competitive revised EPC pricing that covers all three trains and opened the data room with strong interest from potential project partners," chief executive Meg O'Neill said on 5 December. Analysts have identified Tokyo Gas as a potential project partner, with RBC Capital Markets' Gordon Ramsay describing Louisiana LNG as a "good fit" with the Japanese utility's strategy of diversifying long-term offtake and locking in US gas supply, most recently through its purchase of independent Haynesville shale producer Rockcliff Energy for $2.7bn last year. First LNG at Louisiana is expected ahead of the project's US Federal Energy Regulatory Commission approval, expiring on 30 June 2029, O'Neill told an investor call in July, saying such a timeframe was consistent with a first quarter of 2025 FID. Perth-based Woodside heralded its fully permitted status when it announced it would buy Tellurian in July . But the election of Donald Trump as US president means a pause on issuing LNG export permits to non-free trade agreement nations is expected to be lifted in 2025 . Under O'Neill, Woodside has moved to increase its exposure to Atlantic basin LNG, inking a sales and purchase deal with the 9.5mn t/yr Commonwealth LNG in addition to an offtake deal with the 17.4mn t/yr Corpus Christi LNG in 2014. This adds to its existing 10mn t/yr equity production on Australia's west coast. Louisiana LNG expenditure from December to the end of March will be $1.3bn, Woodside said, estimating forward costs for the initial stage will be $900-960/t, unchanged from the figure at acquisition. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Williams sues ET over gasline fight: Clarification


24/12/04
24/12/04

Williams sues ET over gasline fight: Clarification

Clarifies that Williams filed suit earlier this year. New York, 4 December (Argus) — US natural gas pipeline company Williams has brought a "very large lawsuit" against its US midstream rival Energy Transfer after a legal dispute between the companies delayed construction of a project by Williams, Williams chief executive Alan Armstrong told Argus in an interview on 3 December. Armstrong said Energy Transfer is the only company in "pipeline history" to have defied industry norms over pipeline crossings in a bid to block competitors' projects. The market "was always very honorable" before that, he said. Armstrong said he hopes the lawsuit against Energy Transfer will undercut the "very bad precedent" set by Energy Transfer's alleged legal strategy and "stop the industry from spiraling into that kind of behavior." Energy Transfer did not immediately respond to a request for comment. Energy Transfer throughout 2023-24 tried to block Williams and other rival pipeline companies from building new gas pipelines across its own Tiger pipeline in northern Louisiana, located in the Haynesville shale near a cluster of planned LNG export terminals on the US Gulf coast. Energy Transfer argued that Williams and other pipeline companies' projects proposed an excessive number of crossings under and over its own pipelines, while its opponents argued it was merely interested in controlling market share. Beyond trying to block Williams from crossing the Tiger pipeline, Energy Transfer also prevailed upon federal regulators to review Williams' proposed 1.8 Bcf/d (51mn m³/d) Louisiana Energy Gateway (LEG) pipeline as an interstate transmission line, rather than a gathering line, as Williams claimed. This would have subjected LEG to more regulatory oversight. But the US Federal Energy Regulatory Commission in September denied the request . The broad legal strategy by Energy Transfer provoked ire from industry groups and now-Louisiana governor Jeff Landry (R), who warned it could threaten production growth out of the Haynesville and the coming US LNG export boom. Energy Transfer lost case after case to Williams in lawsuits spanning parishes across Louisiana, but the litigation pushed back the in-service date of LEG from late 2024 to the second half of 2025. The Tiger-LEG pipeline dispute was not the first time Williams and Energy Transfer had seen each other in court. After agreeing to merge in 2015, Energy Transfer in 2016 terminated the merger because of a tax issue that arose before closing. This led a Delaware judge in 2021 to make Energy Transfer pay Williams a $410mn breakup fee for deciding to pull out of its proposed $33bn merger. By Julian Hast Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Brazil's economy accelerates to 4pc growth in 3Q


24/12/04
24/12/04

Brazil's economy accelerates to 4pc growth in 3Q

Sao Paulo, 4 December (Argus) — Brazil's economic growth accelerated to an annual 4pc in the third quarter, led by stronger consumer spending, according to government statistics agency IBGE. The economy accelerated from 3.3pc annual growth in the second quarter and posted the fastest growth since the first quarter of 2023. Household consumption grew by 5.5pc in the third quarter from a year earlier, while government spending increased by 1.3pc. Services grew by 4.1pc. The industry sector grew by an annual 3.6pc, driven by civil construction and five-year high automotive production in July , according to the national association of vehicle manufacturers. Exports rose by 2.1pc, while imports grew by 18pc. The oil, natural gas and mining industry contracted by 1pc, thanks to lower oil and gas exploration and production. Brazil produced 4.35mn b/d of oil equivalent (boe/d) in the third quarter, down from 4.51mn boe/d in the July-September 2023, according to oil and gas regulator ANP. The electricity and gas, water and sewage management sector increased by 3.7pc from July-September 2023, favoured by higher demand despite higher power tariffs. Brazil faced a severe drought in the first two quarters of the year that lowered river levels at hydroelectric plants and increased power charges in September. But the agriculture and cattle raising sector fell by 0.8pc, with expected production of significant crops such as corn and sugarcane dropping from a year prior also because of adverse weather. Still, output of cotton, wheat and coffee increased by 14.5pc, 5.3pc and 0.3pc, respectively, according to IBGE. The investment rate — the percentage of a country's total production that is invested — grew to 17.6pc in the third quarter, an increase of 1.2 percentage points from the same period in 2023. Brazil's GDP growth in the third quarter was up by 0.9pc from the second quarter, reaching R3 trillion ($494bn). By Maria Frazatto Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Biogas takes record share of EU gas demand in 2023


24/12/04
24/12/04

Biogas takes record share of EU gas demand in 2023

London, 4 December (Argus) — Biogas production in Europe was enough to cover 6.6pc of the EU's natural gas demand in 2023, according to figures from the European Biogas Association (EBA)'s latest statistical report. Combined biogas and biomethane production in Europe was 234TWh, or 22bn m³, last year, the EBA said, while latest Eurostat data show the EU's total natural gas demand was 3,519TWh, or 294bn m³. The EBA has revised its 2023 biomethane production estimate upwards to 4.9bn m³, from 4.6bn m³ in its January report . This amounts to an increase of 0.8bn m³ compared with 2022, the biggest yearly rise on record, with year-on year growth reaching 21pc in the EU and 18pc in Europe as a whole. The number of biomethane plants in the region rose sevenfold last year to 1,510, leaving Europe with installed capacity of 6.4bn m³/yr by the first quarter of 2024. Biogas and biomethane made up 6pc of the EU's renewable electricity consumption last year, which in turn accounted for 40pc of total electricity consumed in the bloc. Italy, France, Denmark and the UK had the fastest production growth rates in Europe in 2023, but Germany remained the region's biggest biogas and biomethane producer at 100TWh. If growth rates continue at last year's pace, most European countries are likely to meet the biomethane targets in their 2030 National Energy and Climate Plans (NECPs), said the EBA. However, there is a significant gap between the volumes committed in the NECPs — which add up to 14.6bn m³/yr — and the 35bn m³/yr target in the EU's REPowerEU plan. The shortfall is partly because of insufficient investment . The EBA's report highlights the role of biogas in replacing Russian gas and LNG. According to Eurostat, 98pc of the EU's natural gas demand in 2022 was covered by imports. The bloc has the potential to produce 111bn m³/yr of biomethane by 2040 , representing over 30pc of EU gas consumption in 2022. Last year, 23pc of European biomethane was used for transport, 17pc for buildings, 15pc for power generation and 13pc for industry. Most German, UK, French, Danish, Dutch and Swiss biomethane is still generally used for heating or electricity, while Norway, Italy, Sweden, Estonia and Finland mainly use biomethane for transport. In France alone, a further 1,232 projects are at various stages of development, although French plants continue to be "on the smaller side" at an average capacity of 197 m³/h, compared with an average 468 m³/h in the rest of Europe, the EBA said. Denmark and the UK have larger plants with average capacity of 1,443 m³/h and 961 m³/h, respectively. Denmark also has the highest ratio of biomethane to natural gas in its grid — by August 2024, the share of biomethane in the Danish gas grid had reached 37.5pc. No new plants have been established to run on energy crops as the main feedstock since 2020, and there is a clear EU-wide trend towards waste feedstocks, in line with regulation that aims to phase out crop-based biofuels by 2030, the EBA said. But the feedstock mix currently used in biogas plants varies between countries and a significant portion is still crop-based, it said. Barriers to growth In a poll of network members, the EBA identified the main factors regarded as the greatest barriers to sector growth. These include market availability, low costs of natural gas, regulatory instability, the lack of a single market for biomethane, the lack of mature voluntary schemes, a political push for other solutions and long-term supply contract hurdles. To ensure 2030 targets are met, the association called for increased regulatory stability , long-term goals to boost investment, cuts to red tape and technology-neutrality under EU rules. By Madeleine Jenkins Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Argentina streamlines energy efficiency program


24/12/03
24/12/03

Argentina streamlines energy efficiency program

Montevideo, 3 December (Argus) — Argentina's government continues to fine-tune its energy efficiency program, eliminating red tape that slowed the import of appliances and machinery into the country. President Javier Milei's administration launched a new program in August to provide households and businesses with low-interest loans for energy efficiency. It has expanded the program to include more products and incentives. In late November, it announced a regulatory change for importing energy-efficient products, eliminating the need for performance testing, audits and other bureaucratic steps. Companies importing products now only have to provide an efficiency certification. The measure covers products from televisions for households to motors and pumps for businesses. The change is part of the government's efforts to deregulate the economy. It is juxtaposed to the president's skepticism for climate change. Milei eliminated the environment ministry and Argentina's delegation to the recent UN Cop 29 climate talks abruptly left the meeting. The change is part of the government's efforts to deregulate the economy to encourage investment and use of new technology. The government created in July the ministry of deregulation and state transformation and since then has eliminated hundreds of regulations, including more than 100 related to imports. The government has also eliminated more than 33,000 public sector jobs since Milei took office a year ago. "Any effort for energy efficiency has an immediate effect," said Nicolas Vizcaino, co-founder of Greempact, which creates energy-efficiency strategies for companies. "There is no excuse not to focus on efficiency." Greempact analyzes energy consumption data and other variables to create an energy baseline for clients. The data helps design strategies. Its strategies, which include changing technology, improving management and modifying production procedures, have helped some clients reduce consumption by more than 30pc, the company says. Vizcaino said efficiency is the key to the energy transition, because it not only saves a company money, but also has a positive impact on the entire system, from generation to distribution. "One megawatt of energy saved is less expensive and has a much greater impact than one megawatt of renewable energy added to a grid," he said. By Lucien Chauvin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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