{"id":3542,"date":"2016-10-25T14:46:46","date_gmt":"2016-10-25T18:46:46","guid":{"rendered":"http:\/\/162.223.13.186\/~zacksim\/u-s-ramps-up-natural-gas-exports\/"},"modified":"2022-02-26T13:20:50","modified_gmt":"2022-02-26T13:20:50","slug":"u-s-ramps-up-natural-gas-exports","status":"publish","type":"post","link":"https:\/\/zacksim.com\/blog\/u-s-ramps-up-natural-gas-exports\/","title":{"rendered":"U.S. Ramps Up Natural Gas Exports"},"content":{"rendered":"

The U.S. is all set to double its shale gas exports. Following the first round of exports in February, Cheniere Energy Inc. – the nation\u2019s first and only exporter of shale gas – has received\u00a0the nod from authorities to supply liquefied natural gas (LNG) from a second plant (Train 2) at Louisiana\u2019s Sabine Pass terminal.<\/p>\n

In 2015, shale gas accounted for around half of America\u2019s natural gas output. Shale gas production could double to reach 79 billion cubic feet per day \u2013 about 70% of the nation\u2019s natural gas production \u2013 by 2040, according to reference case estimates from EIA.<\/p>\n

<\/p>\n

Source: EIA<\/strong><\/em><\/span><\/p>\n

Moreover, the U.S. will edge past many other producers in LNG capacity additions in the coming years, as EIA estimates suggest.<\/p>\n

<\/p>\n

S<\/strong>ource: EIA<\/strong><\/span><\/p>\n

Will that add to the supply glut, or does it spell more opportunities for the nation? Between 2012 and 2024, while the U.S. is expected to have a +16% growth (or, 51% of the OECD Americas\u2019 total increase) in natural gas consumption, the country\u2019s production \u2013 the largest in the OECD – is projected to climb at a much faster pace: +47%, largely on the back of shale gas production. That could spell opportunities for U.S. exports\u2019 expansion, especially with demand projected to rise by +26% in the whole of OECD Americas, and by +70% globally.<\/p>\n

<\/p>\n

S<\/strong>ource: EIA<\/strong><\/em><\/span><\/p>\n

<\/p>\n

Source: OECD<\/strong><\/em><\/span><\/p>\n

<\/p>\n

Source: EIA<\/strong><\/em><\/span><\/p>\n

Thanks to the shale revolution, the U.S. could become a net exporter of natural gas in\u00a0the next couple of years \u2013 after having been a net buyer for a long time in the world market.<\/p>\n

<\/p>\n

Source: EIA<\/strong><\/em><\/span><\/p>\n

By next year, liquefied natural gas (LNG) export capacity from the lower 48 states is projected to more than double to 3.2 billion cubic feet per day.<\/p>\n

Already, around 34 LNG carriers have departed the Sabine Pass terminal this year, most of which supplied gas to Argentina, Brazil, Chile and Mexico. Shipments to India and Columbia are also expected to gain momentum soon.<\/p>\n

U.S. could also be giving players like Russia some serious competition. Turkey, Russia\u2019s third largest buyer, took its first LNG shipment from the U.S. in September.<\/p>\n

Furthermore, with expected increases in global gas prices over next year, U.S. capacity additions could translate into gains for suppliers \u2013 something that should induce more production.<\/p>\n

<\/p>\n

Source: EIA<\/strong><\/em><\/span><\/p>\n

Bottom Line for Investors<\/strong><\/p>\n

The surge in U.S. gas exports raises anticipations about an already glutted market. Nevertheless, forecasts point to global demand growth, and gas price rebound may already be underway \u2013 meaning, U.S. gas exporters\u2019 investments could reap substantial returns over time. Cheniere already has two plants (each with a capacity of producing equivalent of 650 million cubic feet per day) and is planning to set up two more next year. Cheniere will reportedly get paid fixed amounts irrespective of whether its customers eventually take any LNG from the terminal.<\/p>\n

The energy sector exemplifies how market dynamics can fluctuate with time, thereby indicating the need to stay updated on market movements while analyzing a sector\u2019s long-term prospects. \u00a0To get insights on which sectors are gaining and which could be floundering, have a look at the latest Stock Market Outlook from Zacks Investment Management. Click on the link below to download your free version today:<\/p>\n","protected":false},"excerpt":{"rendered":"

The U.S. is all set to double its shale gas exports. Following the first round of exports in February, Cheniere […]<\/p>\n","protected":false},"author":1,"featured_media":4124,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[71,72],"tags":[],"class_list":["post-3542","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-private-client-group","category-steady-investor-news"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3542","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=3542"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3542\/revisions"}],"predecessor-version":[{"id":11158,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3542\/revisions\/11158"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=3542"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=3542"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=3542"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}