Argus North America LNG Market Update

The Argus Gulf Coast (AGC) fob price for cargoes loading in September ticked higher over the last fortnight, rising to $10.53/mn Btu on 22 August from $10.17/mn Btu on 8 August.

The inter-basin arbitrage for uncommitted cargoes loading on the US Gulf Coast has remained closed, as has been the case for much of the year. Asian delivered prices did not offer a large enough premium to northwest Europe prices to cover the additional freight cost of sailing to Asia rather than Europe.

US feedgas volumes averaged 15.2bn ft³/d in the week ended 25 August, up from 14.9bn ft³/d in the previous week. The rise came despite unplanned maintenance at Sempra’s Cameron LNG from 18-21 August.

On the gas supply side, flows on Williams' 1.8bn ft³/d Louisiana Energy Gateway (LEG) pipeline have climbed to about 30pc of its capacity since the line entered service on 23 July, adding egress for Haynesville shale gas to meet growing LNG demand on the Gulf coast. LEG transported about 492mn ft³/d to interconnection points with Williams' Transco and Enbridge's TETCO pipelines in the week ended 24 August, pipeline data show. Flows reached nearly 560mn ft³ on 22 August.

The line is one of several projects aimed at moving gas from the Haynesville, a prolific gas field in east Texas and northern Louisiana, to the Gillis hub north of Lake Charles, Louisiana, where gas can then be moved to LNG terminals on the coast. Momentum Midstream's 1.7bn ft³/d New Generation Gas Gathering is expected to enter service in late 2025. WhiteWater's 2.5bn ft³/d Pelican line is slated for the first half of 2027.

In the near term, LNG exporter Venture Global's 27.2mn t/yr (3.6bn ft³/d) Plaquemines terminal south of New Orleans will be a source of growing demand. Feedgas to the terminal, which produced its first LNG last December, averaged 3bn ft³/d of gas in the week ended 25 August and may absorb another 0.6bn-1bn ft³/d by the end of 2025 if it brings all of its planned trains and on-site gas turbines on line. On-site generators can consume about 14pc of a facility's feedgas. 

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Author: Tray Swanson, Associate Editor, LNG