The Issue
The leading Western majors have been snapping up access to US liquefaction capacity at a rapid clip since the start of the year. The deals are realigning their portfolios and reshaping the LNG landscape, which has shifted considerably since natural gas powerhouse Russia’s invasion of Ukraine in February last year.
Gobbling Up Gas
The majors have added almost 10 million tons of annual offtake in North America this year. That accounts for almost 40% of all the volumes sold so far in 2023 from liquefaction projects on the continent, where the likes of Norway's Equinor and Chinese buyers have also been topping up their supply. The majors' deals have been heavily weighted toward offtake agreements rather than equity investments, continuing a trend within the group of looking to North America for offtake to balance equity interests elsewhere.
TotalEnergies, already the top US LNG offtaker, cemented its position earlier this month with an agreement to buy 5.4 million tons per year from NextDecade’s Rio Grande project in Texas as part of a deal that will also see the French major eventually buy 17.5% of the operator itself. Shell and Exxon Mobil have meanwhile grabbed 3 million tons/yr and 1.1 million tons/yr, respectively, from Mexico Pacific's Saguaro Energia LNG facility, which will liquefy gas sourced from the Permian Basin and priced off the regional Waha hub.
