U.S. LNG exports climb again in 2022

U.S. LNG exports hit a record in 2021 and surged again in the first four months of the year. In addition, a growing proportion of those exports have shifted away from Asia and to Europe, according to a recent report from the U.S. Energy Information Administration.

During the first four months of 2021, the U.S. sent about 34% of its LNG to Europe. That percentage rose to 74% in the first four months of 2022. In 2020 and 2021, Asia had accounted for nearly half of U.S. LNG exports.

U.S. LNG exports averaged 11.5 billion cubic feet per day (Bcf/d) during the first four months of 2022, up 18% increase compared with the 2021 annual average. The increase in U.S. LNG exports was driven by additional export capacity at Sabine Pass, which added Train 6, and and Calcasieu Pass, whose first five blocks came online this year, the EIA reported..

In November, the Federal Energy Regulatory Commission (FERC) authorized Venture Global Calcasieu Pass, LLC, (Venture Global)—the developer of the Calcasieu Pass liquefied natural gas (LNG) export terminal—to commission the first six of nine liquefaction trains. The first authorization was one of the initial steps toward full commercial service.

Calcasieu Pass is a 1.3 Bcf/d liquefaction facility located in Cameron Parish, Louisiana. Similar to nearby LNG terminals Sabine Pass and Cameron, Calcasieu Pass will export LNG through the Calcasieu Ship Channel located on the Gulf of Mexico. Calcasieu Pass is the seventh U.S. LNG liquefaction export facility to begin producing LNG since 2016.

In addition, demand for gas in Europe has been unusually strong. Since December, the European Union (EU) and the United Kingdom have been importing record-high levels of LNG, in part because of low natural gas storage inventories in the region. High spot natural gas prices at the European trading hubs gave incentives to global LNG exporters with destination flexibility in their contracts to deliver more LNG supplies to Europe. The growth of LNG imports in Europe and a mild winter offset lower natural gas pipeline imports from Russia, the EIA reported.

The United States became the largest LNG supplier to the European Union and United Kingdom in 2021, accounting for 26% of total imports. In the first four months of 2022, LNG imports from the United States to the EU and the United Kingdom have more than tripled, compared with 2021, averaging 7.3 Bcf/d and accounting for 49% of total imports, according to data from the International Association for Natural Gas, CEDIGAZ.

LNG imports from Russia and Qatar, meanwhile, accounted for 14% each (2.1 Bcf/d).

During the first four months of 2022, U.S. LNG exports to Asia declined by 51%, averaging 2.3 Bcf/d compared with a 2021 annual average of 4.6 Bcf/d. China and South Korea were top destinations for U.S. LNG exports in 2021. This year, however, China received only six LNG cargoes from the United States in the first four months of the year because pandemic-related lockdown measures. In addition, a mild winter and high LNG spot prices reduced demand for spot LNG imports. U.S. LNG exports to South Korea fell by 0.6 Bcf/d. Exports to Japan fell by by 0.5 Bcf/d, the EIA reported.