Sabine Passe exported the first cargo of liquefied US shale gas

Energy, LNG, Markets, Ports & Terminals — By on February 29, 2016 at 10:59 AM

Port SabineThe LNG Asia Vision: Griaig Jallal,  Senior Data Editor of VesselsValue writes:

According to VV@, a vessel movements application from online ship search, valuation and mapping service VesselsValue.com, the 2014-built, 160, 000 cbm LNG Carrier Asia Vision has left the LNG loading berth at Sabine Pass in the US Gulf on the 25 February 2016. As befitting a historical location, Sabine Pass (the site of the two major battles during the American Civil War) has exported the first cargo of liquefied US shale gas, and the first US-produced non-Alaskan LNG cargo to be sold for export since 1957.

The Asia Vision cargo was reported sold on the spot market to Petrobras as part of the run up to full operational status of first of the six gas liquification trains under construction at Sabine Pass. As is generally the case with LNG projects, technical issues have delayed the start of production, but the Cheniere Energy Inc., operated facility is expected to be exporting long-term contracted cargoes by the end of 2016.

Why is Sabine Pass selling spot cargoes?

According to documents lodged with the US Securities Exchange Commission in October 2011, the seller, Sabine Pass LNG L.P., has to offer the pre-contract cargoes to the buyer (then named as BG Gulf Coast LNG, LLC before the sale of BG Internertional to Shell). If these cargoes are rejected, the seller has the right to sell to non-affiliated buyers. Indeed, the contract states the seller has to take reasonable steps to sell these trial-run cargoes, and should not pursue the buyer for compensation for damages.

Which is something on an issue today, as there is hardly a global shortage of natural gas, and prices have tumbled in the wake of the collapse of the crude oil price, with several producers are offering LNG cargoes in the spot market. But nonetheless, the sailing of the Asia Vision marks another entry of Sabine Pass into the history books.

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