Near-term outlook said to dim for further North American LNG export development

摘要

Demand, supply chain and capital budget shocks from the coronavirus pandemic make it unlikely any more North American LNG export projects will secure financing for construction in the next five or six years, according to an S&P Global Platts Analytics outlook issued June 23. In recent months, final investment decisions on multiple US and Canadian LNG export projects have been delayed to 2021 or beyond. Some developers have stopped issuing timing guidance. In Mexico, Sempra Energy’s Energia Costa Azul had been targeting FID by the end of June, but recently cautioned that receipt of a key permit could be slowed due to the virus. Platts Analytics’ outlook, issued during a webinar focused on the Canadian gas market, reflects the concern that, amid a sustained period of low international prices, developers will not be able to support their delivered costs, especially those with more spot exposure and higher upfront expenses. “We think it is more likely this forecast will come to pass,” said Ross Wyeno, lead analyst, Americas LNG, Platts Analytics. Because of Western Canada’s relative proximity to the world’s biggest LNG buyers in Northeast Asia, there had been a lot of hope that more export projects would be sanctioned there, especially after Shellbacked LNG Canada decided in October 2018 to move forward with construction.