First cargo of United States shale gas to arrive next month

Marco Green
June 26, 2017

A tanker loads liquefied natural gas at Cheniere Energy's Sabine Pass LNG export facility in Cameron Parish. Further increase in USA shale gas imports could be included in a gift package from Korean President Moon Jae-in in his first visit to Washington and summit with Trump later this week.

The deal calls for Cheniere to sell and deliver ~3.5M metric tons/year of LNG to Kogas, which represents more than 10% of South Korea's total annual demand. On Sunday, the companies held a ceremony to mark the start of the deal at Sabine Pass. The SPA, which was originally signed in January of 2012, officially commenced on June 1, 2017, with the first cargo loading the following day. The company will also be better able to adjust to changes in domestic demand as USA -originating LNG can be freely traded unlike LNG from the Middle East that cannot be resold.

South Korea's state-run Korea Gas said Monday that it will start importing U.S. shale gas in July.

Cheniere is the United States' only LNG exporter, so far, although a number of other facilities are in the works. USA shale gas would be transported to Korea via six new LNG carriers, constructed under the order of KOGAS in 2015 by two Korean shipbuilders.

According to the gas company, Daewoo Shipbuilding & Marine Engineering and Samsung Heavy Industries won orders to build six ships for the new project in 2015. KOGAS has since grown to become one of the largest buyers of LNG and is the Republic of Korea's dominant gas provider.

Also, Kogas CEO Lee Seung-hoon will be a part of the business delegations that will join President Moon Jae-in's visit to the United States later this week.

Other reports by Click Lancashire

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