LNG

Infraestructura Energética Nova (IEnova), the Mexican subsidiary of Sempra Energy, said a positive final investment decision was taken to proceed with the transformation of the existing Costa Azul LNG import terminal into the first Mexican LNG export plant.

The Cheniere Energy-owned Corpus Christi LNG export plant in Texas is the first of the four US Gulf Coast-based facilities to recommence cargo liftings since activities were temporarily halted as Hurricane Laura approached last week, while seven LNG carriers are standing by in the Gulf to load.

The Corpus Christi plant began loading cargoes again just two days after the hurricane made landfall farther north in the Gulf of Mexico near Lake Charles on the Louisiana-Texas border.

The first cargo was loaded on August 30 onto the 177,200 cubic metres capacity “Sohshu Maru”, with another cargo being taken by the 140,645 cubic metres capacity “Golar Arctic” and a third on August 31 by the 155,000 cubic metres capacity “Gaslog Shanghai”, according to shipping data.

Renewed cargo liftings helped to boost Gulf Coast LNG cargo futures to their highest levels in 2020. These are settled derivatives contracts available through to October 2022 and based on the average free-on-board (FOB) cargo prices.

The value of a US GCL cargo for October 2020 rose to $3.600, up from $3.250 per MMBtu on August 31, while November jumped to $4.486 from $4.347 per MMBtu.

The December GCL contract increased to $4.973 per MMBtu from $4.905 per MMBtu on August 31.

Before the Corpus Christi plant began cargo liftings the last cargo loaded in the GoM had been on August 23, the shipping data showed.

There were also seven unladen LNG carriers on September 2 either in a holding pattern offshore or entering the Gulf.

Other plants were also on the way back. Cheniere said that a comprehensive facility and operational assessment of its Sabine Pass plant in Louisiana, the largest facility in the US with 22.5 MTPA of nameplate capacity, had revealed no significant damage as a result of the hurricane.

“Cheniere has started to execute on its plan to restart LNG production at Sabine Pass,” said the company.

Sempra Energy, the owner of the Cameron LNG export plant in Louisiana, said its teams had been able to conduct preliminary visual inspections of the Cameron facility and the site of the proposed Port Arthur LNG project in Texas and of other infrastructure in the region.

“The initial evaluation indicates minimal flooding and no catastrophic wind damage,” said Sempra.

“Thorough inspections are planned pending confirmation of sufficient site safety and security. The team at Cameron LNG is committed to the restoration of full operations as soon as safely practicable,” added the company.

Venture Global, the Virginia-based company developing three liquefaction and export plants in Louisiana, said its Calcasieu Pass facility under construction in Cameron Parish had sustained minimal impacts from the hurricane, which passed directly over the project site.

“A walk-through inspection of most areas of the site following the storm confirmed that the project site’s robust storm protection system, including a perimeter wall and storm water pumping system, performed as designed,” said Venture Global.

“While we are relieved by the minimal impacts to Calcasieu Pass LNG, we are mindful that the surrounding communities of Cameron and Lake Charles have suffered significant damage from this powerful and historic storm,” the company added.

Kinder Morgan Inc., the US pipelines company and owner of the US Elba Island LNG export plant, confirmed that three liquefaction units were still shutdown after a fire last week in a mixed-refrigerant compressor at the LNG facility near Savannah in Georgia.

The United States expects liquefied natural gas exports to average 6.6 billion cubic feet per day in the second quarter of 2020 before declining in the third quarter.

The US owner of the Transcontinental Gas Pipe Line (Transco), the nation’s largest interstate natural gas delivery system linking LNG export plants and domestic natural gas markets in 12 Southeast and Atlantic Seaboard states, has become the latest company to adopt protective measures from takeovers at a time of low equity prices.

TC Energy, the Canada-based pipeline company, has asked US regulators to increase delivery capacity on its North Baja Pipeline to the US-Mexican border to serve the Costa Azul LNG export venture on the Pacific Coast of Mexico.

The United States expects daily natural gas requirements for LNG exports to increase by 36 percent during most of 2020 compared with 2019 and even higher by the end of 2020 as more liquefaction capacity comes on stream and existing plants ramp up production.

The US benchmark Henry Hub natural gas price, the main indicator of US LNG export values, averaged $4.15 per million British thermal units in November, up $0.87 per MMBtu from the October average and December future and spot prices have spiked to the highest since 2014.

Sempra Energy, the California-based utility, said it had started the commissioning process for the first liquefaction Train at the Cameron LNG export plant in Hackberry, Louisiana.

Kinder Morgan, one of the main US pipeline operators and owner of two LNG facilities, said it could now move forward with modifying its Gulf LNG import facility in Mississippi to handle exports as it is already doing with its Elba Island plant near Savannah, Georgia.