Update: Cheniere's 1st LNG Arrival in Europe
Updated with approximate time of arrival, and confirmation by Galp that it bought the cargo on a spot basis.
The first commercial LNG cargo to be shipped to Europe from the US Lower 48 docked at the port at Sines in Portugal in the early evening of April 26 for delivery to Portugal’s Galp. The cargo is expected to be the first of many into Europe.
Creole Spirit, which can hold up to 174,000 m3 of LNG at -161oC, left Cheniere’s Sabine Pass LNG export facility in Louisiana a week ago. It is Cheniere’s 6th shipment but the first headed to Europe. The ship docked at Sines a little after 7pm UK/8pm local time, according to tanker tracking sources.
A Galp spokesman told NGE early afternoon on April 26: “It's expected to arrive later this afternoon, hopefully in time to start discharging immediately afterwards or at first light tomorrow morning.” Galp confirmed it bought the cargo on the spot market. Cheniere has not said to whom it sold the cargo.
Several European utilities, though not Galp, have signed long-term offtake contracts with Cheniere; many had expected to resell volumes into Asia. But the world LNG market became glutted as Chinese demand turned sluggish, and so Europe – with its many receiving terminals and largely interconnected market -- has become the LNG market of last resort.
Portugal’s EDP is among several to have contracted LNG from Cheniere’s 2nd LNG export project at Corpus Christi, Texas, once that starts up in 2018.
The US exported LNG to Japan for decades since the 1970s from Kenai in Alaska, and a tiny cargo was shipped from Lake Charles, Louisiana across the Atlantic to the UK in 1959 to demonstrate that LNG could be transported safely.
But Creole Spirit marks the start of what is expected to be a regular LNG trade flow from the US Gulf to Europe. Gazprom board chairman Viktor Zubkov on April 26 however said that Russia sees no US threat to Gazprom’s European gas sales.