Quarterly Gas Review – Issue 5

In this issue of the OIES Quarterly Gas Review we updated our “LNG tightness” metric (with thanks to Argus Media) that measures the spread between the US Gulf Coast LNG FOB and the Henry Hub price. It is interesting to keep track of this ‘LNG tightness’ in a fast-changing energy world. In December 2018 with Ichthys LNG up and running, Yamal LNG reaching full capacity after train 3 started production in the November and the commissioning of Bovanenkovskoye field’s third and final gas production facility, an incremental 43 bcm/y capacity increase materialised. This translates into global spare capacity increasing for the first time in the last 3 years, leading to a sharp decrease of our “LNG tightness” indicator.

Using Patrick Heather’s research  we have implemented a methodology to calculate the churn rates of HH for the United States, TTF for North-West Europe and JKM for Asian LNG. For 2018, our analysis shows that JKM, TTF and HH respectively qualify as illiquid, liquid, and very liquid hubs.

By: Thierry Bros

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