Gulf FOB rates slip; LNG strong

The U.S. Gulf Coast’s Free On Board (FOB) cargo values slid during the week of Dec. 28-Jan. 4. Production remained strong at Gulf Coast liquefaction terminals while netbacks were bolstered by falling freight rates. Venture Global LNG’s Calcasieu (La.) Pass terminal continues toward commissioning to become the seventh major export facility. S&P Global Platts assessed the Gulf Coast Marker for February at $26.050/MMBtu, up $5.05/MMBtu versus the previous market session on Dec. 31, but down $5.25/MMBtu from the beginning of the week. Compared to last year during the same time period, the Gulf Coast FOB cargo values was up 400 percent. In the Gulf, feedgas nominations for 2021 reached 10.4 Bcf/d on average. Feedgas nominations in 2020 averaged 7.4 Bcf/d. Better market economics, and newly installed liquefaction trains at Gulf facilities, including at Cheniere Energy’s Sabine (La.) Pass, drove the gains in feedgas nominations. At Sempra Energy’s Cameron (La.) LNG export terminal, feedgas demand rose 50 percent to 1.9 Bcf/d on average, while Freeport (Texas) LNG showed an advance of 64 percent to 1.8 Bcf/d on average. December showed the highest monthly feedgas nominations in the Gulf with an average of 12.11 Bcf/d, according to Platts Analytics data. Also, Panama Canal congestion has boosted market conditions for the Gulf Coast LNG exporters. The maximum wait Jan. 4 for unreserved LNG tankers was six days northbound toward the Gulf of Mexico and four days southbound toward the Pacific Ocean, according to canal data. In Jan. 4 trading, the front-month the Henry Hub contract remained in the same $3.70-$3.85/MMBtu range of recent trading sessions after briefly flirting with $4/MMBtu Dec. 27-29. (Henry Hub is a natural gas pipeline located in Erath, La., that serves as the official delivery location for futures contracts on the New York Mercantile Exchange). (Source: Hellenic Shipping News 01/06/22) US LNG WEEKLY: Gulf Coast Marker falls as European prices move downward | Hellenic Shipping News Worldwide