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NatGas Slides As Mild Weather Trumps Freeport LNG’s First Cargo Since June Blast


NatGas Slides As Mild Weather Trumps Freeport LNG’s First Cargo Since June Blast

Natural gas prices fell Monday morning as mild weather for the Lower 48 dents heating demand, and inventories remain plentiful as the winter season winds down. There’s still too much production as prices hover around $2.45 per million British thermal units (MMBtu). 

The bearish backdrop of the NatGas market trumped signs of a nearing partial restart at the Freeport liquefied natural gas plant in Texas. 

Ship-tracking data compiled by Bloomberg show BP Plc’s Kmarin Diamond vessel departed from the facility last weekend with a shipment headed for the Suez Canal. 

“The cargo is a partial load of fuel that had been in Freeport’s tank before the complex shut down, according to traders who asked not to be identified because the information isn’t public,” Bloomberg said. 

As of 1100 ET, Freeport LNG has received 471 million cubic feet of natgas, the highest daily volume since the explosion at the facility last June. 

For more on the recent developments. Here’s what Houston-based energy firm Criterion Research emailed clients:

Freeport LNG has shown its first material flows since June 2022, with yesterday’s late-cycle nominations settling at 164 Mmcf/d and this morning’s early flows totaling 398 Mmcf/d via TETCO Stratton Ridge and Coastal Bend. If we also include TETCO-BIG meter station, those totals rise to 216 Mmcf/d and 467 Mmcf/d.

The Kmarin Diamond LNG Tanker arrived at Freeport LNG on February 10 and departed on February 12 with a partially laden hold. After the Kmarin Diamond left, Prism Agility moved in and is now the second tanker to dock at Freeport LNG. There are five more LNG tankers lying in wait off the coastline.

Criterion Research explains what has to happen next for a partial restart to occur. 

At Criterion, we currently believe the initial tanker was loaded down with LNG that was already stored onsite after the June 2022 incident. Freeport does not yet have the approval to reinstate service of the liquefaction trains, and the new gas flowing on site seems to be tied to the earlier approval to “commence commissioning, including cooldown, of the LNG rundown piping system and LNG train 3 (Unit 13).”

Traders will watch Freeport this week to see what news comes from the facility, as a partial restart seems imminent. 

Tyler Durden
Mon, 02/13/2023 – 15:10

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