Utilization at Elba Liquefaction facility on US Atlantic Coast jumps to 30-day high

Houston — Kinder Morgan's Elba Liquefaction facility appeared to be operating at its highest utilization in a month Feb. 4, with feedgas deliveries jumping about 41% from the average over the previous 30 days, S&P Global Platts Analytics data showed.

The smallest of the six major LNG export facilities in the US ramped up as winter demand and Asian prices, while having moderated sharply, continued to provide incentive for deliveries. The ramp-up also came even as the terminal was conducting planned maintenance activities on two units.

The 10-train Georgia terminal has yet to reach full capacity of 2.5 million mt/year since shipping its first cargo in December 2019. One of the trains has been offline since a fire in May 2020. The operator continues to coordinate a repair schedule to allow it to resume service on Unit 2, according to spokeswoman Katherine Hill. She did not say how long the routine maintenance on other units would last.

Gas deliveries to Elba totaled 230 MMcf/d on Feb. 4, up from 150 MMcf/d the day before and an average 163 MMcf/d over the previous 30 days, Platts Analytics data showed. The last time Elba feedgas demand was higher was on Jan. 5, at 240 MMcf/d.

Total gas deliveries to US LNG export terminals were just shy of 11 Bcf/d on Feb. 4, after ending a run Feb. 1 of five consecutive days above that threshold. Feedgas demand remains below the record deliveries of 11.58 Bcf/d set on Dec. 13, Platts Analytics data showed.

After hitting a record $32.50/MMBtu on Jan. 13, less than nine months after plunging to a record low of $1.825/MMBtu, the Platts JKM, the benchmark price for spot-delivered LNG to Northeast Asia, has moderated substantially as the market rolled to March. Platts assessed the JKM at $7.83/MMBtu on Feb. 4 .

A new monthly record was set in January for LNG tanker transits of the Panama Canal, as US shipments to Asia surged, according to the operator of the Canal. Wait times for LNG tankers passing through without a reservation, meanwhile, have eased so far in February. The Canal is the shortest passageway from the US Gulf Coast to East Asia, the world's biggest import market for LNG.

T he forward European netback is now strongly pointed to a premium in late-March and April, suggesting that many US cargoes may remain in the Atlantic Basin this spring. That would be a reversal from January, when imports of LNG into Europe's liquid trading hubs slumped to their lowest level in nearly three years, according to Platts Analytics data.

The fire at Elba occurred in a mixed refrigerant compressor of Unit 2. Two adjacent units that were shut as a precaution were later brought back online, while Unit 2 has remained down since the fire nine months ago.

The terminal -- originally built to import LNG and later converted to handle exports after the US shale revolution -- utilizes Shell's Movable Modular Liquefaction System design. Shell is the sole offtaker under a 20-year agreement.