Start-up of three LNG projects paving the way for rise in US natural gas trade

The U.S. Energy Information Administration (EIA), the statistical and analytical agency within the U.S. Department of Energy, is anticipating further growth in natural gas trade, thanks to three new liquefied natural gas (LNG) export projects, which are slated to come online by the end of next year.

Based on EIA’s Short-Term Energy Outlook (STEO), the LNG exports will continue to spearhead growth in U.S. natural gas trade as three LNG export projects currently under construction begin operations and ramp-up to full production by the end of 2025 while increased natural gas exports by pipeline, mainly to Mexico, are also expected.

The forecast indicates that net exports of U.S. natural gas – exports minus imports – will grow 6% to 13.6 billion cubic feet per day (Bcf/d) in 2024, compared with 2023, while a boost of another 20% to 16.4 Bcf/d is on the cards for 2025.

Furthermore, U.S. LNG exports are estimated to be on the rise, going up by 2% in 2024 to an average of 12.2 Bcf/d and an additional 18% in 2025, reaching 2.1 Bcf/d. In addition, U.S. natural gas exports by pipeline are set to grow by 3% or 0.3 Bcf/d in 2024 and by 4% in 2025. However, pipeline imports are expected to decline by 0.4 Bcf/d in 2024 and increase slightly by 0.1 Bcf/d in 2025.

During the 2024–25 period, EIA predicts that existing U.S. LNG export facilities will run at similar utilization rates as in 2023, since annual maintenance typically occurs in the spring and fall when global LNG demand is lower and temperatures are mild. In May 2024, LNG exports are forecasted to take a downturn while two of the three trains at the Freeport LNG export facility undergo annual maintenance.

Moreover, Plaquemines LNG Phase I and Corpus Christi Stage 3 are scheduled to kick off LNG production later in 2024 and load the first cargoes by the end of the year. The developers of Golden Pass LNG plan to place in service the first two trains of this new three-train LNG export facility next year.

The U.S. Energy Information Administration is predicting an increase in U.S. natural gas pipeline exports to Mexico as several pipelines in the country – Tula-Villa de Reyes, Tuxpan-Tula, and Cuxtal Phase II connecting to the Energía Mayakan pipeline on the Yucatán Peninsula – become fully operational in 2024–25.

While these pipelines started partial service in 2022–23, they have not been operating at full capacity. In addition, flows via the Sur de Texas-Tuxpan underwater pipeline are likely to increase slightly in 2024 when it begins delivering natural gas from the United States to Mexico’s first LNG export project, Fast LNG Altamira.

Even though U.S. natural gas pipeline imports from Canada remained relatively unchanged over the last two years, averaging 8.1 Bcf/d, the EIA expects pipeline imports from Canada to remain a key supply source, particularly for the U.S. Midwest region during winter months.

According to the U.S. agency, U.S. LNG imports, which primarily serve New England and generally peak in winter months, fell slightly in 2023, mainly because of record-warm winter weather. EIA predicts that LNG imports will average about 0.1 Bcf/d in 2024–25 and continue to serve as a marginal supply source during periods of high demand, particularly in the winter months.