Forget Latin America, Asia Is the Biggest U.S. LNG Buyer Now

Updated on
  • Most U.S. LNG exports have gone to Latin America so far
  • Shift to Asia is due to winter demand for the power-plant fuel

Asia’s finally becoming a prime destination for U.S. shale gas cargoes.

At least 10 of the 12 tankers bearing liquefied natural gas that left Cheniere Energy Inc.’s Sabine Pass terminal in Louisiana in December are headed for Asian countries, shipping data compiled by Bloomberg show. The December tally surpasses November’s record of 10 departures. Sabine Pass is the only terminal shipping U.S. shale gas overseas.

The departures include the Seishu Maru, which left Sabine Pass on Dec. 22 for China, and Stena Clear Sky, which shipped out on Dec. 10 for Japan. That’s a shift away from Latin America since exports began in February.

Asia’s emerging as a bigger buyer as winter’s chill stokes demand for the heating and power-plant fuel, fulfilling analysts’ predictions that the region would eventually become a major importer of U.S. supply. Global demand has the U.S. on course to become a net exporter of gas this year, a turnaround from just a decade ago when it was facing shortages.

Asia is “probably the most economic destination to ship to right now," Het Shah, an analyst at Bloomberg New Energy Finance in New York, said in a phone interview Tuesday.

Spot LNG prices in northeast Asia have jumped 79 percent since July, according to Energy Intelligence’s World Gas Intelligence report.

More than half of the 42.9 million tons a year of U.S. LNG export capacity over the next three years is contracted by Asian buyers, a July report by Bloomberg New Energy Finance showed.

Cheniere wasn’t immediately available for comment.

— With assistance by Kevin Varley, and Naureen S Malik

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