Lake Charles to Limit Higher Prices for U.S. LNG, Goldman Says

BG Group Plc (BG/)’s Lake Charles LNG project will add almost 2 billion cubic feet a day to U.S. gas exports by 2021 and help limit higher prices, Goldman Sachs Group Inc. (GS) said in a report yesterday.

The terminal will bring U.S. exports of liquefied natural gas to 7.7 billion cubic feet-a-day, assuming 8.7 billion cubic feet-a-day of liquefaction capacity is built, Goldman Sachs analyst Samantha Dart in London said in an e-mailed report.

The U.S. investment bank predicts the Lake Charles export project will get necessary financing for construction, with a final investment decision expected in 2015, according to Dart.

“From the perspective of the global LNG market, this means that the balance from 2020 will likely be softer than we previously expected, as future demand will have more supply available to draw from,” Dart said. “However, at this point we do not expect the 2020-2023 market balance to be as soft as in 2016-2017, when we expect global liquefaction capacity to rise significantly.”

The Lake Charles project got approval on Aug. 7 from the Department of Energy to export LNG to countries who do not have a free trade agreement with the U.S.

To contact the reporter on this story: Chou Hui Hong in Singapore at chong43@bloomberg.net

To contact the editor responsible for this story: Mike Anderson at manderson34@bloomberg.net

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