Trade Groups Project Big Year for US LNG
A trio of trade groups representing the US natural gas and LNG industries said January 10 that US LNG is “ready to take centre stage” in 2019, becoming the third largest source of exported LNG in the world.
The three organisations – the American Petroleum Institute (API), Center for LNG and LNG Allies – issued a joint statement on the “extraordinary” developments expected of US LNG in 2019.
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“The dramatic expansion of US LNG exports since 2016 continues to deliver tremendous benefits across America and around the world,” Todd Snitchler, vice president of market development at the API, said in the statement. “With LNG export capacity set to nearly double in 2019, the US is poised to become a leading global supplier. US LNG cargoes have already been delivered to nearly 30 countries around the globe, and with global LNG demand rapidly rising, we expect even more countries to reap the benefits – including reduced emissions – from US LNG in the years to come.”
Charlie Riedl, executive director of the Center for LNG, said multiple US projects are poised to come online in 2019 and nearly double US LNG exports. The growth of the industry, he said, is underpinned by a “massive” domestic natural gas resource base that will continue to be amongst the lowest cost in the world.
“Even as exports grow, the price of natural gas is projected to be only slightly higher in 2040 than it was in 2010,” he said. “Most importantly, modest price increases will be significantly outweighed by the positive economic benefits of exports.”
And Fred Hutchison, CEO of LNG Allies, said the growth in US LNG exports will help with job creation at home, with ending energy poverty around the world and with reducing global greenhouse gas emissions as natural gas from LNG displaces coal in industrial and power generation applications.
“When you also factor in the geostrategic and competitive advantages of US LNG – especially in markets that have long been dominated by a monopolistic gas supplier – this is truly a win-win-win situation,” he said.
There is a slew of LNG projects awaiting final investment decision (FID) this year in the US, with ExxonMobil/Qatar Petroleum's Golden Pass possibly heading the list. Venture Global has also sold out of one of its plants provisionally, while Tellurian last year was confident of taking FID in the coming few months, assuming it had signed up provisional sales agreements for three if not five trains at its Driftwood LNG project. Saudi Aramco has been reportedly talking about taking equity in the project.
The US projects are not alone though: QP is expected to take FID on a major project to add some 33mn mt/yr LNG export capacity at its giant complex, and there are two Mozambique plans also in advanced talks with customers. The bearish newsflow on the state of the Chinese economy at the turn of the year was therefore particularly unwelcome in this sector.