Another power trip at Freeport LNG as FOB cargo values drop

Freeport LNG has ramped back up production from two trains after a power interruption tripped them offline, while a third train continued to undergo scheduled maintenance.

The operational update at the Texas facility came as US FOB Gulf Coast LNG cargo values fell during the week ended April 19.

That was the third straight weekly decline. The Platts Gulf Coast Marker has fallen almost 60% since it hit an all-time high of $58.250/MMBtu on March 4.

S&P Global Commodity Insights assessed the GCM for cargoes loading 30 to 60 forward at $24.150/MMBtu on April 19, $3.350/MMBtu lower week on week, keeping Northwest Europe as the best netback.

In the week ended April 19, US liquefaction facilities nominated an average 12.08 Bcf/d of feedgas, down 1.2% compared with the previous week, S&P Global Commodity Insights data showed.

At Freeport LNG, a major turnaround on Train 1, which began April 5, continued. Trains 2 and 3, meanwhile, briefly tripped offline April 18, due to an interruption of power, according to an air emissions notice to state regulators. The units restarted later in the day, according to the notice. Feedgas nominations to Cheniere Energy’s Sabine Pass facility in Louisiana dipped at the beginning of the week, before quickly rebounding and registering 4.8 Bcf/d on April 19. Nominations to Cheniere’s Corpus Christi Liquefaction facility in Texas dipped in the middle of the week, before rebounding to around 2.3 Bcf/d on April 19. Feedgas demand at the other four major US LNG export terminals was fairly stable at or near capacity during the latest week.

The average wait at the Panama Canal for unreserved LNG tankers transiting the passageway stood at three days northbound and five days southbound April 19, according to the Panama Canal Authority.

US exporters have seen a surge in long-term contracting in recent months, amid high spot prices in end-user markers. The commercial activity has created momentum for several new projects that are targeting to bring additional capacity online in the US around the middle of the decade.

During his weekly podcast posted on Driftwood LNG developer Tellurian’s website April 19, Executive Chairman Charif Souki said project financing efforts were benefitting from the macro price environment, as well as a recent announcement by the Export-Import Bank of the United States that it was seeking to unlock financing for American manufacturing. The initiative is expected to target export projects.

One unknown, Souki said, was procedurally how fast the US initiative would move.
Source: Platts