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US remains 'market of last resort' for LNG imports: BP official
Platts
Chicago
Petroleumworld.com 05 11 07
The recent spike in liquefied natural gas imports shows that the US
remains a "market of last resort" for LNG, a BP Canada Energy executive said
Thursday at a conference in Chicago.Echoing other speakers at the GasMart 2007 conference, Lee Lunde, the
company's senior vice president of North American gas and power, said US
regasification terminals are vastly underused.Citing data from the US Department of Energy and analytical firm Bentek
Energy, Lunde said only 30% of capacity at US LNG facilities has been utilized
since January 2004. Only in April did capacity utilization rise to 70%, and
Lunde said that was because competing markets in Europe experienced a mild
winter, limited pipeline interruptions and unusually high gas-storage levels,
all of which reduced the continent's demand for gas.The subsequent collapse in European gas prices resulted to the diversion
of spot LNG cargoes to the US, he told attendees of the conference, which is
hosted by Intelligence Press.Looking at forward prices on both the NYMEX gas futures contract and the
UK's National Balancing Point, Lunde noted the $4/MMBtu US premium that is
projected to remain through September would continue to lure LNG spot cargoes
to the US.He predicted it would be a short-term phenomenon, however. "It is clear
that LNG imports are more a function of decisions and the events in Europe,"
Lunde said.--Samantha Santa Maria, samantha_santamaria@platt.com
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Platts 10 05 07
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