latest-news-headlines Market Intelligence /marketintelligence/en/news-insights/latest-news-headlines/gas-flows-to-us-lng-plants-drop-amid-power-outages-in-texas-region-62718109 content esgSubNav
Log in to other products


Looking for more?

Contact Us
In This List

Gas flows to US LNG plants drop amid power outages in Texas, region


Essential Energy Insights - March 2021


what is the impact of the eu sustainable finance disclosure regulation sfdr


Episode 8: What the SolarWinds compromise means for information security


Infographic Q4 20 US Power Forecast

Gas flows to US LNG plants drop amid power outages in Texas, region

Feedgas deliveries to U.S. LNG export terminals continued to plummet as an energy crisis driven by extremely cold temperatures and snow deepened in Texas and other parts of the Southern U.S., but operators reported that they have resolved some infrastructure issues that had contributed to disruptions at the facilities.

Total natural gas flows to the six major U.S. export facilities dropped to about 2.2 Bcf/d on Feb. 16, down from about 5.3 Bcf/d a day prior, according to pipeline flow data from S&P Global Market Intelligence. Flows had exceeded 10 Bcf/d as recently as Feb. 8.

The decline in volumes was pronounced at all four of the facilities along the Gulf Coast. The Freeport LNG Development LP terminal south of Houston showed no detectible deliveries. A Freeport LNG spokesperson declined to comment.

The polar blast has also hobbled gas-fired electric power generators. They faced pipeline supply shortfalls and frozen instrumentation.

Texas Gov. Greg Abbott's office asked the operators of the LNG export facilities and other large industrial users of natural gas and electricity in the state to curb their energy consumption so supplies could be used for homes, according to Charlie Riedl, the executive director of the Center for Liquefied Natural Gas, a Washington, D.C.-based LNG trade group. The "emergency request" from the governor stopped short of an order, but the LNG companies — the operators of the Freeport LNG and Cheniere Energy Inc.'s Corpus Christi LNG plants — were quick to comply, Riedl said in a Feb. 17 interview, citing information from members.

The governor later that day announced he had issued an order banning gas companies from exporting their gas outside of the state and requiring them to instead direct their production to in-state power generators.

"All of the Gulf Coast projects, they have backed [feedgas deliveries] way off in order to respond to all of this," Riedl said. "It's no different than prioritizing in any other natural disaster where you have citizens who are in need of heating and electricity. That is obviously the priority. Our focus is on making sure that we are helping and being part of the solution."

SNL Image

The volume of feedgas deliveries to U.S. LNG facilities was close to the level reached in August 2020 after Hurricane Laura blew through southwestern Louisiana and caused two plants to suspend operations. That hurricane came amid a wave of U.S. LNG cargo cancellations driven by low international prices and weak demand exacerbated by the coronavirus pandemic.

At Sempra Energy's Cameron LNG plant in Louisiana, flows to the three-train facility were at a trickle Feb. 16, just days after topping 2 Bcf/d. Sempra said the facility lost power Feb. 15 due to a fault on transmission lines feeding the plant and not from the controlled blackouts in the region. But spokesperson Paty Ortega Mitchell said the problem was fixed by Feb. 17. Cameron relies on power from Entergy Corp.

"We do have power restored to the site and are working to ensure we can safely restart operations," Ortega Mitchell said.

Some midstream infrastructure bringing gas to LNG facilities had also been sidelined in the cold temperatures. Kinder Morgan Inc.'s Natural Gas Pipeline Co. of America LLC invoked force majeure at two compressor stations in Cameron Parish, La., on Feb. 15 and said the delivery point at Cheniere's Sabine Pass LNG export facility would be unavailable starting Feb. 16. The pipeline operator said it had resolved power issues at those compressor stations by the afternoon of Feb. 16 and would start scheduling gas deliveries to the facility. Flows to Sabine Pass, the country's biggest LNG export terminal, had fallen below 1 Bcf/d on Feb. 16. Flows to Corpus Christi LNG had dropped to less than half of that.

Market observers said there was little indication that the Arctic conditions would lead to sustained disruptions of U.S. LNG exports. But the Texas governor's request for LNG exporters to curtail operations illustrated the severity of the problem as workers raced to restore power to more than 3 million customers, according to Jason Feer, head of business intelligence at Poten & Partners.

"If you are worried about gas supplies and you are trying to figure as a state what you can do, then you would obviously look at natural gas exports as a potential way of freeing up some gas," Feer said. "But that tells you how bad it is."