Washington (Platts)--3Dec2007
US imports of liquefied natural gas in November dropped to their lowest
level in four years, consultant Pan EurAsian Enterprises said Monday in its
weekly LNG summary.
Only 27.3 Bcf of LNG was used in November, down about 32.8% from 40.6 Bcf
used in November 2006, the firm said. But because of very high LNG
imports earlier in 2007, the year-to-date total at the end of November is 709
Bcf--the highest in the history of US LNG imports--compared with 528 Bcf the
same period last year and 588 Bcf in 2004, the previous record year. The
summary is based on regasification data.
As a result, 2007 will close out as a record year, although the likely
year-end level of 735 Bcf will be below earlier expectations in the 800 Bcf to
900 Bcf range.
LNG usage in the Atlantic Basin markets has been lower in the fall and
early winter of 2007 because of adequate LNG supplies in Europe, high levels
of stored gas in the US and mild weather, Pan EurAsian said. The exception is
Spain, where imports picked up markedly in the fall, putting the nation on
track for another record LNG import year, the consultant added.
"This set of circumstances may be fortunate as recent developments in the
LNG business have been troubled with problems," the consultant said in its
weekly summary. "The UK's new LNG facilities all have problems of one sort or
another, with construction delays being experienced at both the South Hook and
Dragon LNG terminals in Wales and access problems at the Excelerate terminal
in Teeside," it said, adding that strikes during the year also had an impact
on LNG consumption in France.
Lower-than-expected consumption of LNG in the Atlantic Basin "has been to
the benefit of Japanese buyers of LNG," Pan EurAsian said, noting that it has
been a particular boon to Tokyo Electric Power, which has 8,200 MW GW of
nuclear capacity offline indefinitely because of damage from an earthquake in
early summer. "To make up for this, TEPCO and other Japanese power companies
have stepped up considerably their purchases of LNG and oil for power
generation purposes," the consultant said in the summary.
Also hampering the market is problems with new LNG production facilities,
Pan EurAsian said, noting that a new liquefaction facility in Equatorial
Guinea ran into commissioning problems, which unexpectedly took it offline for
a month. Also delayed in starting commercial deliveries is a new Statoilhydro
liquefaction facility in northern Norway, it added.
Meanwhile, US natural gas prices have been relatively moderate because of
a lack of stress on supplies and record-high gas storage stocks. Natural gas
prices in the UK and Europe have been high, however, over worries about gas
supplies and the influence of very high oil prices, Pan EurAsian said, adding
that a recent outage at Norway's new Ormen Langen field has brought forth new
concerns about the reliability of pipeline supplies to the UK and northern
Europe.
--Valarie Jackson, valarie_jackson@platts.com
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