(by Paul Vivian and Rick Preckel, www.prestonpipe.com) Market Monitor – A review of our forecast from the November issue left demand intact but shifted the expected supply components just a bit. Not much has really changed in this sector from November except that import sources have been a bit more resilient than expected, as has seamless demand. According to a Reuter’s article, Freeport LNG sought permission from federal regulators on February 13 to restart what it is calling Phase 1 of commercial operations. Phase 1 includes the full restart of the plant’s three liquefaction trains, two storage tanks and one LNG loading dock. The amount of gas flowing from pipelines to Freeport jumped to 0.5 bcf/d on February 13, the highest rate since the facility was shut by a fire in June 2022. When operating at capacity, Freeport can turn 2.1 bcf/d into LNG. In other LNG news, Tellurian Inc. is seeking $3.2 billion from equity partners to complete construction of Phase I of the proposed 27.6 mt/y Driftwood LNG LLC export facility. The Driftwood project has had some setbacks including the loss last year of two of its supply agreements. Finally, NextDecade Corp. has requested that FERC respond to an 18-month old appellate court remand which has delayed approval of their Rio Grande LNG project. NextDecade said 8 SPAs have been signed for the project with most of the 11 mmt/y going to European buyers. They expect an FID by the end of March. Import Supply – The December import total was 137,136 tons which was nearly right on the license tally from last month. January 2023 import licenses are down at 70,376 tons. The February linear forecast, with 9 of 20 days summed, is back up at 165,584 tons. The top import item for the month of December 2022 was carbon ERW, over 4 ½” OD not over 16” OD, at 46,160 tons, which was double last month’s volume. The price was $1,685/ton which is up $271/ton. The price is no longer steady with a bump like that.
Preston Pipe Report – January 2023
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