UK LNG regasification rates nudging 100 million cu m/d early Dec 10

UK LNG regasification rates came close to moving into three figures Dec. 10 as UK gas demand has continued above seasonal norms on the back of cold temperatures as well as high gas-for-power demand, an analysis by S&P Global Platts showed.

LNG regas rates in the UK were running at 99 million cu m/d early during the Dec. 10 gas day, with total nominations for the gas day at 95 million cu m, which if realized, would be the highest daily volume since late March, data from National Grid showed.

The increase was largely evenly spread amongst the UK's three LNG regasification terminals with Isle of Grain nominated at 37 million cu m, South Hook nominated at 32 million cu m, and Dragon at 27 million cu m for the Dec. 10 gas day, S&P Global Platts Analytics data showed.

The UK has seen a steep increase in LNG regas in recent weeks, with National Grid data showing that LNG regas averaged 72 million cu m/d for the Dec. 1-8 gas day. Data from Platts Analytics showed that 75 million cu m was sent into the UK National Transmission System during the Dec. 9 gas day.

This compares to a 46 million cu m/d average in November and 21 million cu m/d in October, while December 2020 averaged 57 million cu m/d, Grid data showed.

Storage withdrawals in the UK ceased for the Dec. 10 gas day with demand forecast at 311 million cu m and the UK gas system seen 9 million cu m long, Grid data showed.

The increase in LNG traffic into the UK has come on the back of the NBP being a premium market for LNG so far this winter, with the NBP December contract having expired at 232.30 pence/therm (Eur93.088/MWh. $30.764/MMBtu) in comparison to the Dutch TTF equivalent at Eur91.35/MWh and the Spanish PVB at Eur94.20/MWh.

As a result, the recent rise in LNG regas has come from both the UK and Spain, as both countries have less gas reservoir storage capacity than other European countries, making LNG a larger factor in terms of winter gas supply.

Data from Platts Analytics showed that there could be as many as six LNG tankers due to berth at UK terminals before Dec. 20, five of which hail from the US.