Both the overall number of liquefied natural gas (LNG) export projects that ultimately are built and the total volumes of LNG exported may be significantly less than once projected for the United States, executives said last week at the LDC Gas Forum Mid-Continent in Chicago.

A Repsol SA executive said the global energy giant is looking at all options for its under-used Canaport LNG import facility in New Brunswick (NB), including possibly an East Coast export facility for North American supplies.

Repsol Energy North America Vice President Vince Morrissette, and speakers representing a unit of Royal Dutch Shell plc, BG Group plc and Deloitte MarketPoint LLC, agreed that domestic gas exports most likely would be 3-6 Bcf/d, but depending on circumstances, it’s possible that less than 3 Bcf/d could be transported overseas.

When Repsol sold all of its LNG assets to Royal Dutch Shell plc, it specifically kept the Canaport terminal in St. John, NB (see NGI, March 4). However, Morrissette noted that the import terminal has faltered as U.S. unconventional gas supplies have grown. Repsol is now evaluating export possibilities at the facility that otherwise have been viewed as a possible peaking supply facility in the East, he said.

“We are evaluating exports there, and there are a couple of different supply projects there,” said Morrissette. He cited a “huge shale play” that hasn’t been drilled near the NB facility. “That may or may not come to fruition, but it would be an obvious candidate for liquefaction exports.”

There is also the prospect of Marcellus Shale supplies being shipped north for export from Canaport. “We’re taking a close look at that, too,” said Morrissette. He and other panelists emphasized that the market ultimately would decide how much LNG and which North America export terminals would succeed.

A decade ago there were 40 U.S. proposals for LNG import terminals, but only eight were built, noted Deloitte MarketPoint’s George Given, vice president of advisory services. Similarly, he said only a small number of the current 30 export facilities now on the table ultimately will be constructed (see related story).

Clearly, said Given, North American export projects have an advantage globally because of price and market conditions, adding that market forces ultimately would decide. BG’s Julie Nelson, who directs government/public relations, agreed that the market would decide.

Deloitte MarketPoint has a large stake in North American LNG exports, including projects in British Columbia and on the Gulf Coast.

Shell Energy North America Senior Vice President Beth Bowman made a strong case for U.S. dominance of unconventional gas supplies for a long time.

Bowman stressed the U.S. unconventionals advantage in terms of the “Three A’s” — abundance, acceptability and affordability of domestic unconventional gas supplies. There are more liquid U.S. energy markets and a geologic profile that generally is more accessible than unconventional plays in other parts of the world that tend to be deeper and thinner, said Bowman.

The wide differences in global oil and natural gas prices are likely to remain.

“Don’t expect oil and gas prices to come together anytime soon,” Bowman told the audience. She said technology unlocking tight, coalbed methane and shale gas has more than doubled the supplies now found in the United States from 1,000 Tcf in 1990 and 2,384 Tcf. “At current consumption levels we now have a hundred years worth of natural gas.”

Mexico has considerable unconventional gas supplies, but political, economic and topographical reasons probably would keep them undeveloped for a long time.

“You will not see the Mexicans developing these resources, and the reasons are both political and regulatory,” Bowman said. “The Mexican government has prohibitions against developing its unconventional gas resources. In addition, the shale is located in arid areas with no water readily available and the supplies are not close to any market centers.

There are a number of other nations, including Australia, which is leading the way with major new liquefaction facilities, but like Canada, those projects are operating in stranded markets, something the United States does not have to deal with, the panel said. Given noted that Australia soon would pass Qatar as the world’s largest LNG supplier, with no domestic alternatives.

Drawing on a worldwide gas case developed by Deloitte MarketPoint, Given said the outlook for North American gas prices remains depressed. In addition to the surplus in shale gas supplies, he said the recession also has contributed to low gas prices. On the shale gas supplies, they now are about one-third of U.S. supply, and “no one saw that coming,” he said. Deloitte, like many other analysts, predicts that the United States will become a net gas exporter by 2017, with a lot of the supplies tied to Mexico.

“The impact of that could be quite a milestone,” said Given of the net export forecast. “I think Mexico needs a little more attention. Although we do have some LNG coming out of Mexico, Mexican natural gas demand is very significant and it could have an important role for the United States.”

Bowman said from Mexico’s perspective, “it is much better off bringing in low-priced added supplies from the United States,” while it continues to export some natural gas.

Mexico’s level of gas imports has grown by leaps and bounds over the last 20 years. According to Energy Information Administration data, the country’s annual gas imports grew from 16 Bcf in 1990 to 609 Bcf in 2012.

The situation in Mexico is one example of how the “shale gas revolution” has created a competitive advantage for the United States in global energy markets, Bowman said. “It is one that we will probably enjoy for quite a few years before it catches on elsewhere in the world.”