U.S. Becomes Top LNG Exporter In First Half Of 2022

U.S. Becomes Top LNG Exporter In First Half Of 2022
The United States became the world's largest liquefied natural gas exporter during the first half of 2022, according to data from CEDIGAZ.

The United States became the world’s largest liquefied natural gas (LNG) exporter during the first half of 2022, according to data from CEDIGAZ.

Compared with the second half of 2021, U.S. LNG exports increased by 12 percent in the first half of 2022, averaging 11.2 billion cubic feet per day (Bcf/d). U.S. LNG exports continued to grow for three reasons – increased LNG export capacity, increased international natural gas and LNG prices, and increased global demand, particularly in Europe.

According to our estimates, installed U.S. LNG export capacity has expanded by 1.9 Bcf/d nominal (2.1 Bcf/d peak) since November 2021.

The capacity additions included a sixth train at the Sabine Pass LNG, 18 new mid-scale liquefaction trains at the Calcasieu Pass LNG, and increased LNG production capacity at Sabine Pass and Corpus Christi LNG facilities. As of July 2022, we estimate that U.S. LNG liquefaction capacity averaged 11.4 Bcf/d, with a shorter-term peak capacity of 13.9 Bcf/d.

International natural gas and LNG prices hit record highs in the last quarter of 2021 and first half of 2022. Prices at the Title Transfer Facility (TTF) in the Netherlands have been trading at record highs since October 2021. TTF averaged $30.94 per million British thermal units (MMBtu) during the first half of 2022. LNG spot prices in Asia have also been high, averaging $29.50/MMBtu during the same period.

Since the end of last year, countries in Europe have increasingly imported more LNG to compensate for lower pipeline imports from Russia and to fill historically low natural gas storage inventories. LNG imports in the EU and UK increased by 63 percent during the first half of 2022 to average 14.8 Bcf/d.

Most U.S. LNG exports went to the EU and the UK during the first five months of this year, accounting for 64 percent, or 7.3 Bcf/d, of the total U.S. LNG exports. Like 2021, the United States sent the most LNG to the EU and UK during the first half of the year, providing 47 percent of the 14.8 Bcf/d of Europe's total LNG imports, followed by Qatar at 15 percent, Russia at 14 percent, and four African countries combined at 17 percent.

In June, the United States exported 11 percent less LNG than the 11.4 Bcf/d average exports during the first five months of 2022, mainly due to an unplanned outage at the Freeport LNG export facility. Freeport LNG is expected to resume partial liquefaction operations in early October 2022.

Utilization of the peak capacity at the seven U.S. LNG export facilities averaged 87 percent during the first half of 2022, mainly before the Freeport LNG outage, which is similar to the utilization on average during 2021.

To contact the author, email bojan.lepic@rigzone.com


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