US cumulative LNG capacity (MTPA)
Source: EIA
100
month that Energy Transfer LLP and NextDecade both
underway, look well placed to meet this unexpected leap
announced new supply agreements with customers in
in demand.
Asia and Europe, boosting significantly the prospects for their respective Lake Charles and Rio Grande LNG
90
Shovels at the ready
80
The US unquestionably has a strong pipeline of near
70
shovel-ready LNG projects. What they seek is off-take
confident of rapidly improving market conditions, kicked
agreements with buyers to secure financial closure. In the
off construction in March ahead of a formal FID. Phase
60
projects. Meanwhile, Driftwood LNG developer Tellurian,
downturn of 2020, this was a tough call, but in the wake
one of the project will deliver up to 11 MTPA of capacity,
50
of Europe’s appeal for LNG, buyers around the world
with a total of 27.6 MTPA envisaged over four phases.
40
have taken note and are rushing to secure supplies.
By July last year, Tellurian had already secured sales
30
In April, US LNG developer Venture Global
and purchase agreements amounting to 9 MTPA from
announced a final investment decision (FID) on its
international major Shell and trading houses Vitol and
20
Plaquemines LNG project, the first such decision for a
Gunvor, making it a front runner to declare an FID on the
10
new US LNG plant since 2019. The project’s first phase
first phase of the project this year.
will have 13 MTPA capacity, rising to 20 MTPA in the
0
However, compared with coal and oil, LNG demand
routed to non-European markets, most of the Europe’s
was relatively resilient throughout the pandemic as China,
gas comes from the Russian pipeline supplies, which are
in particular, upped its buying to support an extensive
not easily replaced.
could be twice that, WoodMac says, if the EU institutes
existing Calcasieu Pass facility and has a start-up target
a total ban on Russian gas imports at the earliest
of 2025.
practical opportunity, possibly in 2024. Underlining the
Announcements of new off-take agreements have been coming rapidly. Norway’s Equinor has agreed
estimates that the country will account for 57% of new
a deal to take LNG from Cheniere, half of which will
LNG capacity worldwide in the period 2022-26.
support the planned expansion of the Corpus Christi LNG plant beyond seven trains. Cheniere also secured
Upstream response essential
a deal with South Korea’s Posco in May, the same
Such a rapid second-phase expansion for the US
US LNG capacity additions (MTPA)
to reduce its dependence on Russian gas, REPowerEU,
12
pollution.
a key element of which is to boost gas imports from its
10
both by Asian demand and a European market caught in
likelihood that the region will take more, if it is available. European countries with no LNG import capacity,
levels of stored gas. The LNG market quickly went from
most notably Germany, are rushing to deploy floating
bust to boom as LNG prices rebounded, hitting record
storage and regasification units, as are others heavily
trade levels.
dependent on Russian pipeline gas, such as Italy, with
European pivot to be another seminal moment for Europe and the LNG
volumes and rebuild gas-in-storage ahead of winter.
While oil and coal exports from Russia can be re-
G LO B A L VO I C E O F G A S
4 2 0
European LNG imports have already reached record levels, driven by the need both to replace Russian gas
reduce its dependence on Russian fuel imports.
6
little spare capacity available from their existing facilities.
Russia’s offensive in Ukraine in late February 2022 proved industry. In response, Europe has sought to radically
8
Europe’s newfound desire for LNG has fundamentally changed the expected supply/demand balance of the
2016
2017
2018
2018
2019 2019
Calcasieu Pass
and to increase its purchases of LNG by 50 bcma, with the
Sabine Pass T6
existing non-Russian pipeline gas suppliers by 10 bcma
post-pandemic bounce back in energy demand, driven the approach to Winter 2021/22 with dangerously low
Source: EIA
To address this challenge, Europe is instituting a plan
provinces, to reduce GHG emissions and address local air LNG was therefore one of the first beneficiaries of the
US’ outstanding potential, data company GlobalData
Corpus Christi T3
program of coal-to-gas switching, notably in its northern
for its 20 MTPA CP2 project, which will be adjacent to its
Cameron LNG T2-3
demand.
will see FIDs in the next 24 months. Indeed, the total
Freeport LNG T2-3
contracts, its LNG plants suffered most from weaker
more than 50 MTPA of new US liquefaction capacity
agreements with New Fortress Energy and ExxonMobil
Elba Island
With the US having led the way in terms of offering new flexibility to the market, via flexible and short-term
second phase. The company has also signed purchase
Corpus Christi T2
and more widely.
The US unquestionably has the strongest pipeline of near shovelready LNG projects in the world. Announcements of new off-take agreements have been coming thick and fast.
Overall, consultants Wood Mackenzie estimate that
Cameron LNG T1
utilisation and a hiatus in new project approvals in the US
2022
Freeport LNG T1
role of gas in the energy transition, led to reduced plant
2021
Cove Point
and 2019, as well as some policy uncertainty about the
2020
Corpus Christi T1
to 126 MTPA by 2026/27, and project sanctions in 2018
2019
Sabine Pass T5
2018
Sabine Pass T3-4
2017
Sabine Pass T1-2
2016
26
and Qatar, with its North Field expansion plans already
2019
2019
2020
2020
2020
2020
2021
2022
LNG market. The US, with its robust project pipeline,
J U LY 2 0 2 2
J U LY 2 0 2 2
G LO B A L VO I C E O F G A S
27
