U.S. March LNG exports flat as Freeport plant woes continue

(Reuters) - U.S. exports of LNG fell slightly in March to 7.61 MMt from 7.73 MMt in February as production of the superchilled gas from the country's second largest exporter remained constrained, preliminary data from financial firm LSEG showed on Monday.

But the U.S. was the largest exporter of LNG last year with exports rising 12% over 2022 to average 11.9 billion cubic feet per day. Nearly half of March's and last year's LNG exports were sent to Europe, which cut imports of Russian pipeline gas following Russia's invasion of Ukraine in 2022.

Freeport LNG last month disclosed it had completed repairs on an electric motor at one of the plant's three large processing trains after more than a month of reduced operations. But it added two other processing units would be taken out of service until May, likely leading to another month of overall weaker exports.

Gas flows to the Freeport LNG plant averaged 780 MMcfd over last week, below its about 2.2 bcfd capacity, said financial firm Tudor, Pickering, Holt & Company on Monday.

It means that since January Venture Global LNG, which has been producing above its name plate capacity has emerged as the country's second-largest LNG exporter of the superchilled gas, surpassing Freeport LNG, LSEG data showed.

Europe remained the favored destination for gas, taking about 57%, or 4.31 MT, of March's total exports. But that was down from 60.5% of all the cargoes, or 4.62 MT in February, the LSEG data showed.

Exports to Asia made a major comeback last month, with U.S. exporters sending cargoes on a longer route past the Cape of Good Hope to reach markets from Bangladesh to China as drought hampered Panama Canal transit, according to the ship tracking data.

Of the 7.61 MT exported last month, 2.54 MT or 33% went to Asia in March. That was up from the region's 25% share in February and double the percentage in January when only 17% went to Asia, LSEG shipping data showed.

Prices in Asia early in the month appear to have encouraged the uptick in purchases by price sensitive countries like India and even Bangladesh, with an increase in spot buying as Asian LNG prices were at $8.30/mmBtu earlier last month, the lowest levels since April 2021, before seeing a slight boost to $8.60/mmBtu.

March exports to Latin America rose slightly to 7%, or .55 MT, compared to 6% or .49 MT in February. Jamaica, the Dominican Republic and Colombia purchased U.S. LNG last month, LSEG ship tracking data showed. There was also one shipment for .07 MT of LNG to Kuwait the data showed.

Freeport LNG's return to service in April last year played a major role in the U.S. becoming the world's largest exporter of LNG in 2023, the U.S. Energy Information Administration said on Monday.

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