We expect that global LNG supply will continue its growth trend in Q4 19, but we see the increments falling due to a high base. Supply growth was 5.8 Mt y/y in September but will drop to 3.4 Mt y/y in October, although total supply will be flat m/m at around 30 Mt. Growth in Q4 19 will depend more on the ramping up of new US trains, with the patchy start to life of the Freeport train a downside risk to our supply forecast of y/y growth of 5.3 Mt. The low-price environment is starting to impact future supply, with Pakistan cancelling a 10-year tender, Texas LNG delaying its FID, and ExxonMobil delaying an FID on the highly advanced Rovuma project in Mozambique.
Initial indications from cargo tracking and customs data suggest that global LNG exports in September came in at 29.7 Mt, higher y/y by 5.8 Mt on a low base but modestly lower m/m due to maintenance events at Corpus Christi and North West Shelf. Planned maintenance in October includes outages at Gorgon (one train, 5.2 Mtpa) and Ras Laffan (two trains, 15 Mtpa) adding to that list.
Exports from Australia grew by 1.2 Mt y/y in September, whereas initial indications are that y/y growth in October could start to slow to only 0.7 Mt y/y. The base is starting to get higher, with Wheatstone largely having ramped to plateau by October 2018, whereas Ichthys, which seems to be hitting something of a plateau (around 0.65 Mt), will still be contributing to y/y growth. Since its start in June, the 3.6 Mtpa Prelude terminal has been in commissioning mode, but it should be able to add 0.14 Mtpa y/y over the coming six months.
However, much of the growth in supply will continue to be focussed on the US market. In September, the US contributed 1.8 Mt y/y to global growth and over October is likely to add 1.6 Mt y/y. Continued growth of this level will rely more on recent projects ramping up, given that a number of projects came online in Q4 18 (Corpus Christi T1 and Sabine Pass T5). The projects recently ramping up include the 4.0 Mtpa Cameron T1, which has been taking around 0.6 bcf/d of feedgas consistently in October, suggesting the train is now producing at a steady level. The 4.4 Mtpa Freeport train has been far less consistent with its feedgas intake. The last few days (from 21 October - 24 October) saw fairly low takes, so it is unclear when steady production levels will be reached.