U.S. Emerged as Largest LNG Exporter in The First Half of 2022: EIA

The U.S. emerged as the world’s top liquefied natural gas exporter during the first half of 2022, according to a July 25 report from the U.S.  Energy Information Administration. U.S. LNG exports averaged 11.2 billion cubic feet per day (bcf/d), up by 12 percent compared to the same period in 2021. An increase in U.S. LNG exports can be attributed to a number of reasons including: enhanced LNG export capacity, higher global natural gas and LNG prices and firm world demand, most notably in Europe. Moreover, record profitability margins for U.S. LNG producers in Asia, Europe and the UK have further incentivised exports.

A decline in U.S. LNG exports was observed in June, following the fire at Freeport LNG export facility on June 8. The fire led U.S. LNG exports to decline by 11 percent compared to the average during the first five months of 2022. As a result of the fire, the facility announced that it would be closed down for 90 days pending regulatory approvals and this is expected to impact LNG supplies towards Europe and the UK. Initially, the impact was estimated to be for 21 days, however Freeport LNG now estimates that the full plant repairs and production could be restored by late 2022.

A key driver of U.S. LNG exports has been the expansion of U.S. LNG export capacity. U.S. export capacity has increased by 2.1 bcf/d peak since November 2021. The capacity increment incorporates a sixth train at the Sabine Pass LNG, 18 new mid-scale liquefaction trains at the Calcasieu Pass LNG, and enhanced LNG production capacity at Sabine Pass and Corpus Christi LNG facilities.

Moreover, international gas prices and LNG prices recorded unprecedented highs during the first half of 2022 and incentivised U.S. LNG exports. Prices in the UK and Europe increased due to tighter supplies because of lower pipeline imports from Russia, amid the Russian invasion of Ukraine.  Accordingly, a significant amount of U.S. LNG exports went to the EU and UK during the first five months of 2022.