The Daley Note

Customers Line Up for Next LNG Wave

Written by East Daley Analytics | Jan 26, 2024 1:00:00 PM

LNG project developers continue to make progress in signing new customers, helping firm up the long-term outlook for natural gas demand in East Daley Analytics’ Macro Supply and Demand Forecast.

On January 16, Mexico Pacific signed ExxonMobil LNG Asia Pacific (EMLAP) to another commitment, a contract for 1.2 MMtpa (~0.16 Bcf/d) from Train 3 of the proposed Saguaro Energia LNG facility on Mexico’s Pacific coast. The latest contract will supply EMLAP with LNG on a free-on-board basis for a 20-year term from the project.

Mexico Pacific already has 1.3 MMtpa of binding offtake agreements with EMLAP signed last February. EMLAP also holds an option to purchase another 1 MMtpa from Train 4 of the Saguaro LNG project.

The latest sales and purchase agreement (SPA) brings Saguaro Energia to 81% contracted in total. East Daley expects the facility to take a final investment decision (FID) this quarter.

The Saguaro facility will be supplied in part by ONOEK’s (OKE) proposed Saguaro Connector out of the Permian Basin. In September, OKE management said FID of the pipeline is dependent on Mexico Pacific’s export facility reaching FID. Both projects may be waiting on progress for the Saguaro Energia Gas Pipeline. The joint development between Mexico Pacific and the Mexican Comision Federal de Electricidad (CFE) will connect to OKE’s Saguaro Connector at the border.

Another next-wave project, Glenfarne’s Texas LNG, signed a heads of agreement (HoA) with gas producer EQT for 0.5 MMtpa for a 15-year term. East Daley does not include Texas LNG (4 Mtpa export capacity) in our LNG export forecast because the facility has no binding offtake agreements. Before the latest HoA, the project had no supply agreements of any kind.

EQT also signed an HoA with Commonwealth LNG to produce 1 MMtpa under a 15-year tolling agreement in September ‘23. Commonwealth LNG expects to reach FID in the 1Q24 but would need to convert several HoAs to binding agreements to do so. Thus far, the 8.4 MMtpa project is only 30% contracted under a single SPA with Woodside. However, Commonwealth has an additional 7.5 MMtpa of HoAs dating to 2019 that could be converted to binding contracts. – Oren Pilant Tickers: OKE, XOM.

Dirty Little Secrets is Now Available

Dirty Little Secrets is now available. East Daley held our Dirty Little Secrets annual webinar on Wednesday, December 13. In “Volatility Will Continue Until Morale Improves,” we reviewed the factors likely to drive volatility ahead in oil, natural gas and NGL markets. We review the outlook for these markets and the midstream sector. Review the Dirty Little Secrets webinar here.

East Daley, Hart Bring NEW Gas & Midstream Weekly

East Daley is teaming up with Hart Energy on the NEW Gas & Midstream Weekly newsletter. This new report combines the strengths of Hart Energy's journalistic reporting and analysis on natural gas, LNG, midstream energy and deal-making with EDA's deep research and intelligence of hydrocarbons, storage and transportation. 
  
Published every Thursday morning, this new powerhouse newsletter is an interactive and enlightening read highlighting breaking news, exclusive interviews, videos, charts, maps and more. The newsletter utilizes East Daley's Energy Data Studio tools for natural gas predictive analytics with Hart Energy's Rextag mapping tools to present a holistic view of pricing triggers, infrastructure growth, pipeline and processing bottlenecks, regulatory and legal hurdles, and the inevitable solutions. Subscribe Here

Energy Data Studio

East Daley Analytics has launched Energy Data Studio, a platform for our industry-leading midstream data and commodity production forecasts. All clients have access to the new client portal. If you have not yet logged in, please fill out the form to request a registration email be resent.

Energy Data Studio leverages our G&P data set for insights into midstream assets across every major oil and gas basin in North America. Users can navigate detailed visual dashboards by region, pipeline, or individual asset to understand crude oil, natural gas and NGL supply at the most granular level.

Energy Data Studio is available through data downloads from the visual interface, in Excel files, or as a direct feed delivered into subscribers’ workflow via secure file transfer. To learn more about Energy Data Studio, please contact insight@eastdaley.com.

The Daley Note

Subscribe to The Daley Note (TDN) for midstream insights delivered daily to your inbox. The Daley Note covers news, commodity prices, security prices and EDA research likely to affect markets in the short term.