U.S. LNG Export Volumes Tick Lower

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--U.S. exports of liquefied natural gas (LNG) are somewhat subdued, even amid an uptick in total natural gas production, data show. The Energy Information Administration (EIA), the data arm of the U.S. Department of Energy, expects total natural gas production in the Lower 48 states to average 112.4 billion cubic feet per day (Bcf/d), supported by volumes from the Appalachia Basin.

The U.S. is the world leader in natural gas production and liquefied natural gas (LNG) exports, which emerged as a source of global energy security after Russia's invasion of Ukraine in 2022 was met with sweeping sanctions on gas-rich Russia.

Data from IIR Energy show gas production is suppressed to about 104 Bcf/d. Spring maintenance season tends to curb anything from pipeline volumes to refinery activity, though production remains about 4.4 Bcf/d higher than this time last year.

With an expected average of 35.9 Bcf/d, the Appalachia Basin is the largest inland natural gas producer by volume, though gains should be modest with only a marginal increase from year-ago levels.

Volumes from the Permian Basin, the largest inland oil producer, are expected to increase by nearly 8% from year-ago levels to average 27.4 Bcf/d this year, making it the second-largest inland gas producer behind Appalachia.

The pressure in a basin changes over time. As they mature, basins tend to yield more natural gas as heavier hydrocarbons remain stuck in subsurface pores. The Permian yielded its first batch of meaningful oil volumes in the early 1920s.

Several companies believe oil production in the Permian Basin may be on the verge of plateauing.

Elsewhere, LNG deliveries remain subdued relative to early-year levels of about 16 Bcf/d. U.S.-sourced exports of LNG hit a record in March, with an average of 15.9 Bcf/d and volumes at times had just surpassed that level.

Exports may be limited, however. IIR Energy data show feedgas into the eight LNG export terminals is just below 15 Bcf/d, putting a lid on short-term future exports. Gas delivered for conversion to LNG dropped this week at the Cameron terminal, led by Sempra Energy (San Diego, California), and Corpus Christi, led by Cheniere Energy (Houston, Texas).

Data show volumes were lower on pipelines feeding the terminals, presumably due to midstream maintenance. Deliveries from the Columbia Gulf Transmission line, owned by TC Energy Corporation (Calgary, Alberta), to Cameron dropped to zero on Thursday.

Drillers may be incentivized by a higher price forecast for Henry Hub, the U.S. benchmark for the price of natural gas, though the LNG market is getting saturated.

The EIA expects total U.S. natural gas production to increase 1.6% from this year's average to reach 117 Bcf/d next year. LNG exports are on pace to increase 6% to average 16 Bcf/d in 2026.

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