Expansions to Lift U.S. LNG Potential

---

Written by Daniel Graeber for IIR News Intelligence (Sugar Land, Texas)

---

Summary

The United States has been the world leader in LNG exports since at least the outbreak of the war in Ukraine in 2022. A handful of expansion projects, notably at Sabine Pass in Louisiana, could put even more tailwinds behind the sector.

---

Baker Hughes Tapped for Sabine Pass Expansion

Already the world leader in exports of the super-cooled gas, the U.S. sector is primed for growth with Baker Hughes tapped to help with the expansion of the Sabine Pass facility in Louisiana.

The United States is already the world leader in exports of liquefied natural gas (LNG), supported by its vast inland shale reserves. The federal government expects the amount of feed gas supporting LNG exports to increase 8.1% to reach 18.6 billion cubic feet per day (Bcf/d) on average for next year.

The sector is under pressure from maintenance, however. Industrial Info Resources in its NATGAS Today report for Monday found deliveries to the Freeport LNG facility in Texas dropped to about half of its capacity of 2.37 Bcf/d because of ongoing maintenance.

That leaves total U.S. feed gas at 16.6 billion cubic feet for Monday, the lowest level so far in July.

Growth Potential Nonetheless

Maintenance aside, the United States is primed for growth. Apart from projects still in the planning stage, such as the Alaska LNG facility from Glenfarne, another 6 Bcf/d would be needed for various expansion projects for plants along the Gulf Coast, according to Industrial Info Resources' weekly natural gas report.

Last week, Baker Hughes said it secured awards from operator Cheniere Energy and engineering firm Bechtel to supply liquefaction equipment for the seventh train at Sabine Pass. Subscribers to the Industrial Info Resources Global Market Intelligence (GMI) Oil & Gas Production Project Database can view a detailed project report of the Sabine Pass expansion.

"These comprehensive technology solutions, from advanced liquefaction equipment to lifecycle services, help our customers expand LNG production and meet growing energy demand," said Baker Hughes Chairman and Chief Executive Officer Lorenzo Simonelli.

Baker Hughes said its work at Sabine Pass could boost output by around 20%.

There could, meanwhile, be some looming supply-side pressures in the U.S. market given the increasing commitments for LNG exports. The U.S. Department of Energy is expecting total U.S. natural gas production to increase by only 2% by next year, compared to the 8.1% growth spurt expected from LNG.

Midstream work, however, continues to support LNG expansions. Sempra Infrastructure, a subsidiary of Sempra Energy, is expected to begin construction this quarter on a 26.9-mile segment of the Texas Connector Pipeline, which would provide up to 2.5 Bcf/d of natural gas to Port Arthur LNG.

All that comes as global supplies of LNG are at a premium due to conflict raging in the Middle East. Qatar, one of the world leaders in LNG exports alongside the U.S., saw its volumes curtailed by a drone strike on its facilities earlier this year.

Qatar Energy estimated that about 12.8 million tons per annum (MTPA) of LNG would be sidelined for as long as five years because of the attacks. That's a little less than half of the export capacity of Sabine Pass.

By the Numbers

• 20% expansion possible for Sabine Pass
• 8.1% year-over-year increase in LNG exports expected

Key Takeaways

• Baker Hughes tapped for Sabine Pass expansion
• Existing facilities are building up, backing long-term LNG commitments

About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).