Facebooktwitterlinkedinmail

OEF Rapid Review Articles

High regional gas prices in South America, most notably Argentina, are attracting US exports of domestically produced LNG, with more than 70% of landed cargoes arriving on the continent so far this year, according to new data compiled by Platts Analytics’ Eclipse Energy. The average FOB price of cargoes shipped to South America through May was $3.42 per million British Thermal Units (MMBtu), new DOE data shows. At that price, South America has offered the most profitable destination for US exports compared with Europe, the Middle East and Asia where US volumes, less the cost of shipping, have yielded an average price of $3.00, $2.87 and $2.69/MMBtu, respectively. The higher price paid for US LNG in South America comes as regional gas markets, particularly in Argentina, are experiencing elevated prices. In an effort to stem the decade-long decline in gas production, the Argentine president, Mauricio Macri, cut domestic subsidies in December allowing consumer prices to rise to $5.20/MMBtu. Macri also extended a $7.50/MMBtu incentive price for output from newly drilled wells. Macri’s administration hopes that higher wellhead prices will revive production in older fields and stimulate new production, particularly in the Vaca Muerta Basin where large untapped volumes remain locked in shale and tight gas reservoirs. In March and April the first and second US cargoes to arrive in South America landed in Brazil, spurring expectations that the South America’s largest consumer market could become a dependable buyer of US LNG. Since April, all eight US cargoes exported to the region have landed in the Southern Cone nations of Argentina and Chile.
SOURCE: platts.com
S&P Global Platts
LINK TO THE SOURCE ARTICLE:
South America Now A Key US LNG Market

 

lng-market_web11

 

LINK TO THE SOURCE ARTICLE:
South America Now A Key US LNG Market

 

 

 

SHARE YOUR THOUGHT

comments