HomeNewsFreeport LNG cancels some March cargoes on restart hiccups

Freeport LNG cancels some March cargoes on restart hiccups

3/22/2023

(Reuters) - The second biggest U.S. liquefied natural gas (LNG) export plant, Freeport, has cancelled up to four shipments of LNG, due to restart snags after an eight-month-long outage, trading sources told Reuters.

In addition, the facility has recently loaded another vessel with a lower amount of gas than originally planned, two of the sources added.

"You arrive with your vessel to load at a given time and they say 'yes you can load', but then an hour later it doesn’t. They blame the long shutdown for restart hiccups," a trading source familiar with the matter said.

When contacted by Reuters, a Freeport LNG spokesperson said that the company does not comment on commercial activity which includes its cargo schedules.

The company said earlier this month that changes in feed gas flows and production rates are to be anticipated, given the duration of the plant’s outage as it continues the restart process and the plant is expected to return to full production over the next few weeks.

U.S. federal regulators have approved the restart of two of Freeport LNG's three liquefaction trains (Trains 2 and 3) in February and the third train (Train 1).

Accounting for 20% of U.S. LNG exports, resumption of the facility is important for global LNG supplies, especially as Europe is rebuilding its gas storage after Russia cut gas exports following Moscow's invasion of Ukraine.

Current demand for LNG in Europe is not as high as previously due to a mild winter, high inventory levels and reduced industrial demand.

But demand could rise again amid forecasts of a hot summer, low hydro levels and an uptick in Chinese demand after the easing of COVID-19 restrictions.

When operating at full power, Freeport can turn about 2.1 Bcf/d of gas into LNG for export.

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