LNG

The United States has been exporting more liquefied natural gas than any other country and LNG shipments were expected to surge through the next 12 months while deliveries were also increasing of pipeline natural gas to both Mexico and Canada.

The US Department of Energy has published its latest LNG monthly export data showing that the United Kingdom and France are consolidating their lead over China in the overall list of countries receiving the most cargoes.

Baker Hughes Company, the US liquefied natural gas equipment-maker and energy services company, reported record orders of $8 billion in the fourth quarter, including for turbo-machinery for LNG production and warned that global spare capacity for oil and gas has deteriorated to the extent it needs a huge investment boost.

EQT Corp. the largest producer of natural gas in the United States through hydraulic fracturing, has announced the completion of a programme to eliminate methane emissions from natural gas-powered pneumatic devices in production operations.

The US Department of Energy has published its latest LNG monthly export data showing the Netherlands, South Korea, France, Spain and the UK receiving the most cargoes and the most expensive shipments departing from a Louisiana plant at the highest price from the export point so far in 2022.

While the US is now one of the world’s largest LNG exporters, the government said states in the Northeast US will pay the highest electricity prices because of inadequate natural gas pipeline supplies, reduced inventories and difficulties in securing LNG shipments for domestic use because of tight global supplies and high prices.

“We forecast that wholesale electricity prices at major power trading hubs will be about 20-60 percent higher on average this winter,” said the Energy Information Administration in its short-term and winter energy outlook.

“The highest wholesale electricity prices are likely to be in New England because of possible natural gas pipeline constraints, reduced fuel inventories for power generation and uncertainty regarding liquefied natural gas shipments given the tight global supply conditions,” explained the EIA report.

The report’s conclusions mean that people in the states of Maine, Vermont, New Hampshire, Massachusetts, Connecticut and Rhode Island will pay the highest power bills in the nation this winter.

The US benchmark Henry Hub natural gas price is expected to remain above $7 per million British thermal units in the winter season.

Henry Hub price

“We expect the Henry Hub natural gas spot price to average about $7.40 per MMBtu in the fourth quarter and then fall below $6.00 per MMBtu in 2023 as US natural gas production rises,” said the EIA report.

“We forecast that US natural gas inventories will end the injection season (April-October) at nearly 3.5 trillion cubic feet, which would be 6 percent below the five-year (2017-2021) average,” the report added.

US consumption of natural gas is forecast as averaging 87.9 billion cubic feet per day in 2022, up 3.9 Bcf per day from 2021 and reflecting more consumption across almost all sectors.

US dry natural gas production averaged 98.5 Bcf per day in the third quarter.

“We forecast natural gas production will average 99.1 Bcf per day in the fourth quarter and 99.6 Bcf per day in 2023,” stated the EIA.

Natural gas will fuel 38 percent of US electricity generation in 2022, up from 37 percent in 2021.

Renewables and coal

“Growing generation from renewable sources limits growth in natural gas-fired generation and coal’s generation share declines because of the expected retirement of some coal-fired capacity,” the report explained.

The outlook forecasts Brent crude oil spot prices averaging $93 per barrel in the fourth quarter and $95 per barrel in 2023.

“Potential petroleum supply disruptions and slower-than-expected crude oil production growth could lead to higher oil prices, while the possibility of slower-than-forecast economic growth may contribute to lower prices,” said the EIA.

“US crude oil production is forecast to average 11.7 million barrels per day in 2022 and 12.4 million barrels per day in 2023, which would surpass the record high set in 2019,” the report added.

Fitch Ratings, the New York-based credit ratings agency and financial services company, has just published a report analysing the European Union’s efforts to mitigate the worst effects on gas markets of a cut-off of Russian imports and for their replacement with LNG and other types of energy.

The US Calcasieu Pass liquefied natural gas export plant has begun pre-commissioning activities and moved closer to being the nation’s seventh large-scale LNG exporter by the fourth quarter of 2021.

Wavespec, the last technical entity within Braemar Shipping Services Plc of the UK and with the construction oversight of more than 100 LNG carriers in Asian shipyards including the large Qatari vessels, has been taken over in a management buy-out.

Wavespec has been a leading international provider of technical engineering services since 1993 for LNG ships and facilities, gas processing, renewables and the marine industry and has current operations in the United States, the UK, the Netherlands and Singapore under a new name Wavespec Holding BV.

The new management of Wavespec is led by Sheila McClain, Managing Partner, Constantyn Gieskes, Partner for LNG and Renewables and Andy Bright, Partner for Marine Shipping Projects.

“We are delighted to announce this change in ownership, which is in line with our strategy of growing a more diverse technical consulting business,” said McClain.

“Going private with more access to the funds we need to expand the business will allow us to sustain current operations and grow with the demands of our clients’ changing needs,” she explained.

“It represents the next chapter for our brand, while we maintain the existing services that we’ve provided our clientele for the past 28 years,” McClain stated.

Wavespec has provided consultancy services to a majority of the US LNG import and export facilities.

It had additionally served as Owner’s Engineer for several projects through the Federal Energy Regulatory Commission and United States Maritime Administration permitting processes.

Wavespec’s previous owner, Braemar Shipping, elected in 2018 to exit its technical services businesses to focus more on its core shipbroking and related activities.

At that time, Braemar made the decision to carve out and maintain Wavespec from its Braemar Technical Services Group (BTS).

The BTS sale was completed in the summer of 2019, which then shifted Braemar’s focus on finding the right home for Wavespec.

Prior to the reorganisation to include Wavespec in the BTS Group, Wavespec primarily functioned independently for much of its 24 years under the Braemar umbrella.

This new change of ownership is part of a strategic plan to allow Wavespec the structure it needs to prosper and grow.

The re-born Wavespec Holding BV is backed by Cosmos SICAV Plc, an investment fund managed by Abalone Asset Management.

Cargo liftings at global liquefaction plants stayed over the 100 level as North Asia spot prices increased along with US Gulf Coast futures, while pipeline and LNG supplies to the UK natural gas market jumped and available wind power plummeted.