Explosion of leading large LNG plant cripples US gas exports

One of the biggest factories of America LNG production for export was damaged by an explosion and fire. The damage forced the Texas Gulf Coast facility to shut down – a move that is expected to affect European and Asian markets.

“As a result of today’s fire, Freeport LNG’s liquefaction facility has been shut down and will be out of service for a minimum of three weeks,” the company said in a statement on Friday evening, without providing further details. news.

Earlier in the day, the company acknowledged an “incident” at the plant in Quintana, about 112 kilometers south of Houston, but said no employees were injured and there was no risk to the community. .

The exact cause of is still unknown The fire and extent of damage. After several witnesses reported a loud explosion and a large fireball in the area, aerial footage taken by local TV stations showed firefighters at the scene, but There was no sign of the fire breaking out.

The Freeport facility produces about 2 billion cubic feet (56 million cubic meters) of natural gas per day, or 20% of all U.S. export capacity. Overall, US LNG exports will be around 9.75 billion cubic feet per day (276 million cubic meters) in 2021, totaling a record 100 billion cubic meters that year, according to the Energy Information Administration.

While U.S. natural gas prices fell more than 6% on June 8, the crash is expected to push prices up and affect global markets more broadly.

Europe in particular is facing a major energy crisis as a result of post-pandemic supply chain disruptions coupled with an unprecedented campaign of sanctions imposed by the West on Russia. Despite all efforts to sever ties, the EU still receives about 40% of all natural gas imports from Russia, mainly via pipelines, after having purchased about 155 billion cubic meters in 2021.

Meanwhile, US LNG exports to the EU totaled more than 22 billion cubic meters last year. President Joe Biden is said to have promised to increase LNG supplies by 15 billion cubic meters by 2022, but some analysts think the US has already produced full capacity and any additional gas sales to the country. Europe will have to be taken from exports destined for other buyers.