US Gulf Coast Back in Action, LNG Export Resumes

301

  • More than 10 tankers were waiting to load in the US Gulf Coast as LNG plants there slowly resumed exports.
  • This takes place after complications from winter storms prevented tankers from loading and sailing since Feb. 14.
  • Twelve LNG tankers were either waiting to load or in transit to one of the four USGC-based LNG export facilities late Feb. 17.

A recent news article published in the Platts reveals that LNG tankers pile up in US Gulf as loadings slowly restart.

Exports from the US halted

Exports from the US halted suddenly as the polar vortex affecting much of North America caused operational complications at liquefaction plants and at ship channels.

The first US-sourced tankers to set sail since the extreme cold weather set in departed from Freeport LNG late Feb. 17.

Since then, another two vessel have left ports in the US Gul Coast: another from Freeport on Feb. 18 and one from Sabine Pass on the same date.

Two for the three tankers had been berthed at their respective export facility for a number of days. Ship channels across the gulf had experienced closures or operational complications at the start of the polar vortex, due to essential personnel being unable to access the ports.

Slower-than-normal rate of loading

Tanker loadings and departures have, however, only resumed at two of the four USGC-located facilities. Consequently, the rate of loading from the gulf, and the US as a whole, is significantly lower than just a week ago.

The seven-day moving average loading rate for the US as whole fell to 5 Bcf/d on Feb. 19, down by more than half from earlier in the month, data from S&P Platts Analytics showed.

As the situation stands, the average export rate for February stands at about 7.4 Bcf/d, below the roughly 9.3 Bcf/d average seen in December and January.

Gulf Coast Facilities

Gulf Coast Facilities continued to be affected by unusual circumstances stemming from the inclement weather in North America. Aggregate feedgas flows to US facilities remained sluggish on Feb. 19, with flows nominated at an anemic 5.9 Bcf, compared to normal rates of around 11 Bcf/d earlier in the month.

The two Texas-based facilities, Freeport LNG and Corpus Christi LNG, were likely to be affected by a mandate issued by that state’s Governor prioritizing natural gas use for power generation within the state.

Flows to Freeport LNG had effectively halted from Feb 16.

Cheniere-controlled Corpus Christi facility

The Cheniere-controlled Corpus Christi facility, however, had flows for Feb. 19 delivery nominated at almost 1 Bcf, Cheniere did not respond for a request for comment on the issue.

Outside of Texas, flows to Cameron LNG were also nominated at a fraction of their usual level at just 567 MMcf. A force majeure was heard to have been declared at the facility for the cancellation of at least one cargo and for the delay of up to another three cargoes. Cameron LNG did immediately respond for a request for comment.

The largest export facility in the country, Sabine Pass LNG, was, however, nominating to pull gas at close to its normal rate of around 3.8 Bcf/day on Feb. 19.

Destination markets beginning to take notice

The delays in loadings and loss of cargoes due to cargo cancellations and force majeures were beginning to affect trader sentiment in both Asia and Europe. In Asia, several US LNG offtakers such as BP, Mitsui and Pavilion were heard covering shorts for March cargoes due to US supply disruptions. The Platts JKM for H2 March, the most prompt half-month under assessment, gained 15 cents/MMBtu on Feb. 19.

In Europe, meanwhile, several traders were heard to being optimizing their portfolios to account for the delays in delivery caused by the polar vortex.

“There are still a few cargoes for March that need to be optimized due to misalignment, and it isn’t necessarily for better financials, but more of an operational optimization,” said a London-based trader.

The trader said there remains some activity for March delivery volume that is in need of optimization due to the change in direction of cargo flows, following the strong start to the year, leaving some offers for March as well as some bids in the same period

Did you subscribe to our daily newsletter?

It’s free! Click here to subscribe!

Source: Platts

1 COMMENT

LEAVE A REPLY

This site uses Akismet to reduce spam. Learn how your comment data is processed.