The gas supply source that will have the greatest intermediate-term impact on the market will be imported liquefied natural gas (LNG), and currently it appears that 16 out of the 90 LNG regasification proposals in North America will be constructed, according to Energy Ventures Analysis Inc. (EVA) consultant Steve Thumb.
In his latest Fuelcast Long Term Outlook, Thumb predicts that given the supply commitments to the North American market from the likely 56 new gas liquefaction projects worldwide, North American LNG import terminals should operate at an average capacity factor of 54-70%. Thumb said most of the 16 projects (including three expansions of Excelerate's Energy Bridge offshore Louisiana) have already lined up LNG supply.
"The chief exceptions are the four Energy Bridge [regasification] ships which currently plan to depend on the evolving spot market, and Anadarko's Bear Head project" in Cape Breton Island, NS, he said. "Anadarko has indicated that it will have a supply agreement by year end."
Thumb also noted that Suez LNG's Bahamas LNG terminal, called Hawksbill Creek, is being reevaluated because of Florida Power & Light's (FP&L) decision earlier this year to not accept any LNG supply agreements (see NGI, June 6). "There is a contingent within the Bahamas trying to get the project sponsors to move the site of [Hawksbill Creek]," Thumb added. "While long term there likely will be a Bahamian LNG regasification terminal, the timing of such a project is now debatable."
An AES Corp. official said this summer that the competing Bahamas project, AES Ocean Express, remains on track despite the FP&L decision (see NGI, June 13). "But this project, which has an excellent site and has obtained all of its major permits, has had trouble obtaining financing and has yet to find a source of supply," Thumb said.
The 16 projects Thumb has identified as most likely to succeed include the following:
Of these 16 projects, 11 already are under construction or will be under construction before the end of the year. Two of the Energy Bridge projects are in service and another will be in service next year. The Altamira LNG terminal in Tampico, Mexico also is expected to be in service next year, which will reduce U.S. gas exports to Mexico. Three more of the LNG projects, including Energy Costa Azul, GNL Mar Andentro and Freeport LNG, are scheduled to be in service in 2007, although GNL Mar Andentro is not even under construction yet and its supply source is uncertain. Eight other projects are due online in 2008 and Gulf Landing is scheduled for 2009.
"While many of the 48 projects identified as unlikely projects have either encountered fierce local opposition or are questionable projects," a few "appear to be excellent" candidates for development, EVA said in its report. "As a result, some could be classified as likely projects" once they reach certain milestones. Among these are Freeport-McMoran's Main Pass Energy Hub offshore Louisiana; ConocoPhillips' Compass Port terminal offshore Louisiana; Cheniere's Creole Trail project in the La Quinta Channel, Louisiana; and BP's Crown Landing terminal on the Delaware River in New Jersey.
"Assuming that all of the 16 projects identified...are completed and as a group they achieve an 80% capacity factor, then...these new terminals, plus the expanded existing terminals, would be capable of increasing U.S. LNG imports to 13.9 Bcf/d by 2010," said EVA. "However..., attaining this level of LNG imports requires access to foreign LNG supplies.
"Beyond 2010, it is projected that LNG imports will continue to grow, as the result of the expansion of new terminals completed by 2010 and the construction of additional regasification terminals," according to EVA, which noted that the 16 projects that are most likely to be developed already have announced plans to add 4.4 Bcf/d of additional sendout capacity beyond their initial capabilities.
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