The Winter 2023–24 Global LNG Analysis by EIA, suggests that sufficient global gas supply is likely to meet demand in the upcoming winter season, aided by full natural gas inventories in the U.S. and Europe and expanded global LNG export and import capacity. An additional 4.0 billion cubic feet per day (Bcf/d) of LNG export capacity is expected to be available, with the U.S.'s Freeport LNG contributing 2.0 Bcf/d. LNG import capacity has also grown by 13% in Europe and Asia. Europe's gas storage is nearly full, with enough reserves to last 65 to 84 days depending on consumption rates. U.S. storage inventories are 8% higher than last year.
LNG front-month futures prices are lower this year due to these increased inventories, with global natural gas prices in East Asia and Europe down by over 50%.
However, risks to this balance include unexpected demand surges or supply interruptions. China's natural gas demand recovery and severe cold weather in Europe or Asia could rapidly increase global LNG spot prices. Simultaneous cold weather in both regions could intensify this effect. Additional risks include production freeze-offs in major gas supplying countries, reduced pipeline exports from Russia, worker strikes, military conflicts in the Middle East, or other unplanned outages, all of which could create shortages and spike prices.
North America's LNG export capacity set to double by 2027.
North America's liquefied natural gas (LNG) export capacity is projected to expand significantly from 11.4 billion cubic feet per day (Bcf/d) to 24.3 Bcf/d, with new developments in Mexico, Canada, and the United States. By the end of 2027, it's estimated that Mexico will add 1.1 Bcf/d, Canada 2.1 Bcf/d, and the U.S. 9.7 Bcf/d through a total of 10 new projects, according to EIA.
In Mexico, three projects are underway, adding up to 1.1 Bcf/d of LNG export capacity. These include Fast LNG Altamira with three units (0.18 Bcf/d each), Fast LNG Lakach (0.18 Bcf/d), and Energia Costa Azul with 0.4 Bcf/d in Phase 1 and a proposed 1.6 Bcf/d in Phase 2. Further proposed projects on Mexico's west coast could add over 2.7 Bcf/d, targeting exports to Asian markets.
Canada is constructing two LNG export projects in British Columbia with a combined capacity of 2.1 Bcf/d: LNG Canada (1.8 Bcf/d) and Woodfibre LNG (0.3 Bcf/d). Additionally, the Canada Energy Regulator has authorized 18 more projects with a total capacity of 29 Bcf/d.
In the United States, five projects are under construction, totaling 9.7 Bcf/d in capacity. These include Golden Pass, Plaquemines, Corpus Christi Stage III, Rio Grande, and Port Arthur, with exports from Golden Pass LNG and Plaquemines LNG expected to start in 2024.
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