Coronavirus continues to weaken LNG exports


U.S. liquefied natural gas capacity continues to rise, but utilization of the plants has collapsed from 85% to 90% in 2019 to just 32% so far this month as buyers cancel dozens of cargoes, Reuters reports.

So far this month, just five vessels picked up cargoes from the six U.S. LNG export plants:  two from Cheniere Energy’s Sabine Pass and two from Cameron LNG—both in Louisiana—and one from a plant in Maryland, Reuters reports, quoting financial data service Refinitiv.

The news service reports no ships have visited Cheniere’s Corpus Christi plant in Texas since June 29, Freeport LNG in Texas since June 27 or Kinder Morgan Inc’s Elba Island plant in Georgia since January.

Natural gas flows to LNG export plants plunged this month after falling to a 20-month low in June as coronavirus lockdowns cut global demand for the fuel.

Before the pandemic slashed energy demand, U.S. producers counted on LNG exports to keep growing fast as an outlet for their record gas output. LNG exports are only expected to rise about 7% in 2020, compared to 68% in 2019 and 53% in 2018.

To date in the month of July, gas pipeline flows to U.S. LNG export plants have dropped to an average of 3.1 billion cubic feet per day (bcfd) from a 20-month low of 4.1 bcfd in June and a record high of 8.7 bcfd in February, according to Refinitiv data.

Reuters has the full story.