US Freeport LNG resumes shipments as second ship berths after outage

Freeport LNG has resumed LNG shipments from its terminal in Texas after an expected partial restart from a July 7 shutdown ahead of the arrival of Hurricane Beryl, according to S&P Global Commodities at Sea data.

The JERA-chartered Gaslog Wales berthed at Freeport LNG on July 21 after the EnBW-chartered Axios II left the terminal laden with a cargo earlier in the day, according to CAS.

The resumption of shipments from Freeport LNG comes after the operator said on July 15 that it expected to resume production in the first of three liquefaction units later in the week and the remaining two trains "shortly thereafter".

However, the Freeport LNG terminal has only restarted Train 3 so far, traders in Asia said July 22.

"Train 3 is running at a reduced rate," an LNG trader based in Singapore said. "Train 1 & 2 need to fix some issues."

Freeport LNG was heard to have canceled more than seven cargoes after Hurricane Beryl damaged part of the Texas facility and kept the plant offline for more than a week, Commodity Insights reported July 18.

Some Freeport offtakers were heard attempting to purchase some cargoes to replace lost volumes, resulting in increased demand for prompt cargoes, market sources said. Multiple sources said Freeport was heard to have canceled eight to 10 cargoes.

The reported cancellation of cargoes by Freeport strengthened Asian spot LNG prices on July 19.

Platts, part of Commodity Insights, assessed the September JKM, the benchmark price for LNG cargoes delivered to Northeast Asia, at $11.945 on July 22, down 1.53%, as Freeport LNG resumed shipments amid bearish spot LNG demand in Asia.

"There may still be some impact from Freeport, not sure, still monitoring, although no Asian buyers were heard buying because of Freeport cancellations yet," an Asian LNG trader said.

In Asia, JERA and Osaka Gas lift 2.32 million mt/year each, while South Korea's SK E&S lifts 2.2 million mt/year of Freeport LNG.

"Didn't see JERA or Osaka Gas seeking replacements due to the Freeport [outage]," another Asian LNG trader said.