Expand Energy, the largest producer of US natural gas by volume, is poised to supply growing LNG feedgas demand on the US Gulf coast with its Haynesville Shale assets, aided by the ease of adding intrastate pipelines in Louisiana, chief executive Nick Dell'Osso told an industry conference this week.
Expand produces 7.1 Bcfe/d across its assets, of which about 2.9 Bcfe/d is in the Haynesville, 2.6 Bcfe/d is in northeast Appalachia and 1.6 Bcfe/d is in southwest Appalachia, with plans to raise overall output to 7.5 Bcfe/d in 2026. The mix of production has the company well-positioned to meet demand for LNG export facilities, AI-focused data centers and industrial growth, Dell'Osso told the Gulf Coast Energy Forum in New Orleans, Louisiana, on 13 October.
About 4 Bcf/d of Expand's production moves to the Gulf coast, with almost half used as feedgas at LNG terminals. The company wants to increase the price exposure of its production to international benchmarks such as the Dutch TTF hub or delivered northeast Asian LNG prices, but Dell'Osso backed away from the previous target of 15-20pc following last year's acquisition of Southwestern Energy, citing the larger scale of production.
"I would expect over several years that we'll get to a meaningful percentage, and we haven't given a new number around that yet," he said. "We need to evolve our strategy there a bit more."
Slim chance for LNG equity
With growing LNG demand in Louisiana and Texas, Expand is unlikely to take an equity stake in an export project, a strategy used at three of the five US LNG projects that have reached final investment decisions this year.
"I'm not sure that we would ever need to take equity in the actual infrastructure facility, but we would consider it for the right terms," Dell'Osso said.
Expand holds a 35pc stake in Momentum Midstream's 1.7 Bcf/d New Generation Gas Gathering (NG3) pipeline, which entered service on 1 October and runs from the Louisiana Haynesville south to the Gillis hub near Lake Charles. The pipeline opens Expand's access to the LNG corridor near the Texas-Louisiana border, but a stake in an LNG terminal, which has higher operational costs, would likely be harder to optimize within the company's portfolio.
As waterborne exports grow on the Gulf coast, limited underground storage capacity likely will add to price volatility, Dell'Osso said. Demand for US LNG exports is expected to grow to about 30 Bcf/d by 2030, up from about 15.5 Bcf/d so far this year.
In anticipation of the volatility, Expand is continuing to try to drive down production costs in the Haynesville, where the breakeven gas price is about $3.50/mn Btu. Lower breakeven costs in the Appalachian basin leave production there less exposed to volatility.
"As much as we're bullish natural gas, the one thing I think everyone can agree on, even the most ardent bulls, is that volatility will still be a very important trend," he said.
