U.S. Set to Reclaim Title as World’s Leading LNG Exporter, According to Reuters

By Scott DiSavino

The United States is expected to become the world’s leading exporter of liquefied natural gas (LNG) this year, surpassing current frontrunner Australia, following the anticipated restart of a Texas plant that was temporarily shut down due to a fire, as per recent data.

A June fire at the Freeport LNG facility, the second-largest U.S. export plant, significantly impacted natural gas exports, reducing U.S. output by approximately 2 billion cubic feet per day (bcfd). This setback allowed Australia to maintain its position as the top exporter amid rising global demand for LNG.

In 2022, U.S. LNG exports grew by 8% to reach 10.6 bcfd, closely trailing Australia’s 10.7 bcfd. Qatar followed in third place, exporting 10.5 bcfd, according to statistics from Refinitiv. These exports were crucial for Europe, which relied on U.S. supplies to replenish its gas stocks after disruptions caused by Russia’s invasion of Ukraine.

In 2021, the U.S. ranked third in LNG exports, behind Australia and Qatar. However, with the commencement of Venture Global LNG’s Calcasieu Pass facility in Louisiana at the beginning of 2022, the U.S. was positioned to reclaim the top spot.

Unfortunately, the mid-year loss of Freeport LNG’s output hindered those ambitions. The facility is projected to resume processing in late January, pending regulatory approval, which could shift export dynamics back in favor of the U.S.

With no new LNG facilities anticipated to commence operations in Australia until around 2026 or in Qatar until 2025, analysts believe production levels will remain stable for these countries in 2023.

The upcoming major U.S. LNG export projects include QatarEnergy and Exxon Mobil’s 2.4-bcfd Golden Pass venture in Texas and Venture Global’s 1.8-bcfd Plaquemines plant in Louisiana, both expected to start shipments in 2024. Meanwhile, an offshore Louisiana facility proposed by New Fortress Energy has encountered delays in regulatory reviews.

James West, a senior managing director at the energy research firm Evercore ISI, noted that as Europe and Asia increase their LNG demands, U.S. operators are poised to expand infrastructure to meet those needs.

In 2022, about 69% (7.2 bcfd) of U.S. LNG exports were sent to Europe, as cargoes were redirected from Asia for higher prices. In contrast, only 35% (3.3 bcfd) of U.S. LNG exports went to Europe in 2021, when Asian prices were more favorable.

The price of natural gas varied significantly in 2022, averaging $41 per million British thermal units (mmBtu) at the Dutch Title Transfer Facility (TTF) in Europe and $34 at the Japan Korea Marker (JKM) in Asia, while remaining at just $7 at the U.S. Henry Hub benchmark in Louisiana.

Recently, Asian gas prices have surged to around $29 per mmBtu, compared to $22 in Europe and a mere $4 in the U.S. Analysts predict that these higher prices will result in an increase in U.S. LNG shipments to Asia this year.