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Released July 23, 2024 | SUGAR LAND
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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--Vessel tracking data suggest shippers are waiting to take on cargo from the Freeport LNG facility for the first time in more than two weeks. The facility was knocked offline by Hurricane Beryl.
The liquefied natural gas (LNG) tanker Axios II was docked off Quintana Island, presumably awaiting to take on cargo from Freeport, the Reuters news service reported on Friday, citing data from cargo tracker LSEG.
LSEG data show Freeport was slated to take in about 800,000 million cubic feet of natural gas per day for processing on Friday, some 60% more than Thursday. No intake was reported from July 7-15.
Data from the U.S. Energy Information Administration (EIA), the statistical arm of the Department of Energy, reported Thursday that indeed the first train, or liquefaction facility, resumed operations at Freeport last week.
"Freeport plans to restart the remaining two trains shortly after the first one, according to the company," EIA's weekly natural gas report read. "Production levels will be at reduced rates for a period of time as personnel continue repairs while operating the facility."
Freeport lost power July 7 as Beryl approached landfall in Texas. The storm hit Texas as a Category 1 hurricane a day later, dropping some 10 inches of rain on the Houston metropolitan area and leaving around 2 million people without power in the immediate aftermath.
Jesus Davis, Industrial Info's vice president of research for the Oil & Gas industry, said it was no surprise that Freeport shut down given the widespread outages in Houston. Freeport LNG uses electric motor-driven compression, therefore power outages completely shut down liquefaction operations.
"Quintana Island is a barrier island that gets it first, even before the coastal towns, so it is not surprise to see wind damage from Beryl at Freeport LNG" he said.
Freeport, one of the largest export terminals in the United States, can receive up to 2 billion cubic feet (Bcf/d) of natural gas, primarily taken from the inland shale basins. Operations, however, have been problematic.
An over-pressurized pipe triggered an explosion and fire in June 2022 that hobbled the facility for much of the year. Problems with some of the electric motors meant the plant was performing below peak capacity for much of 2023, while freezing temperatures in January of this year left it facing technical challenges for weeks.
At its peak, Freeport accounts for about 20% of total U.S. LNG exports, helping to offset a geopolitical risk premium for natural gas by serving as a stopgap in the European market. Before the war in Ukraine, Russia was a main supplier of natural gas, though sanctions left the region scrambling for new resources from friendlier nations.
The United States first exported LNG in 2016 and is now among the largest exporters in the world, rivalling the likes of Qatar and Australia. The U.S. government expects LNG exports to average 14 Bcf/d by next year, a 16% increase over what's expected this year.
Over the seven-day period ending July 17, there were 23 vessels laden with LNG, carrying a combined 75 Bcf of gas in liquid form. That's comparable to year-ago levels, even though nothing was loaded from Freeport last week.
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, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
The liquefied natural gas (LNG) tanker Axios II was docked off Quintana Island, presumably awaiting to take on cargo from Freeport, the Reuters news service reported on Friday, citing data from cargo tracker LSEG.
LSEG data show Freeport was slated to take in about 800,000 million cubic feet of natural gas per day for processing on Friday, some 60% more than Thursday. No intake was reported from July 7-15.
Data from the U.S. Energy Information Administration (EIA), the statistical arm of the Department of Energy, reported Thursday that indeed the first train, or liquefaction facility, resumed operations at Freeport last week.
"Freeport plans to restart the remaining two trains shortly after the first one, according to the company," EIA's weekly natural gas report read. "Production levels will be at reduced rates for a period of time as personnel continue repairs while operating the facility."
Freeport lost power July 7 as Beryl approached landfall in Texas. The storm hit Texas as a Category 1 hurricane a day later, dropping some 10 inches of rain on the Houston metropolitan area and leaving around 2 million people without power in the immediate aftermath.
Jesus Davis, Industrial Info's vice president of research for the Oil & Gas industry, said it was no surprise that Freeport shut down given the widespread outages in Houston. Freeport LNG uses electric motor-driven compression, therefore power outages completely shut down liquefaction operations.
"Quintana Island is a barrier island that gets it first, even before the coastal towns, so it is not surprise to see wind damage from Beryl at Freeport LNG" he said.
Freeport, one of the largest export terminals in the United States, can receive up to 2 billion cubic feet (Bcf/d) of natural gas, primarily taken from the inland shale basins. Operations, however, have been problematic.
An over-pressurized pipe triggered an explosion and fire in June 2022 that hobbled the facility for much of the year. Problems with some of the electric motors meant the plant was performing below peak capacity for much of 2023, while freezing temperatures in January of this year left it facing technical challenges for weeks.
At its peak, Freeport accounts for about 20% of total U.S. LNG exports, helping to offset a geopolitical risk premium for natural gas by serving as a stopgap in the European market. Before the war in Ukraine, Russia was a main supplier of natural gas, though sanctions left the region scrambling for new resources from friendlier nations.
The United States first exported LNG in 2016 and is now among the largest exporters in the world, rivalling the likes of Qatar and Australia. The U.S. government expects LNG exports to average 14 Bcf/d by next year, a 16% increase over what's expected this year.
Over the seven-day period ending July 17, there were 23 vessels laden with LNG, carrying a combined 75 Bcf of gas in liquid form. That's comparable to year-ago levels, even though nothing was loaded from Freeport last week.
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, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
