Gas at sea and in ports. Poland is a beneficiary of American exports

By Marek Grzybowski

Global LPG (liquefied petroleum gas) trade has seen steady improvement over the past two years, following a very weak 2021. Total maritime LPG exports in 2023 increased by 3.6% year-on-year to 144.4 million tonnes, according to LSEG data – serves Banchero Costa. Polish LPG imports increased by 6.5% compared to 2022 to 2,625 thousand. tons – determined by the Polish Liquefied Gas Organization. In the first quarter of 2024, global LPG exports increased to 37.3 million tons.
In 2023, the supply of liquefied gas in maritime trade grew slower than in 2022. Then, an increase of 4.4% y/y was recorded, which followed a decline of 6% y/y in 2021. According to Banchero Costa Research, these numbers are not reflect entire turnover. There are significant differences in the volumes of exports made by different exporters. Variations were also found in the volume of cargo received by various importers.

Americans are the gas leader
In the period January-December 2023, LPG exports from the USA increased significantly by 15% y/y to 59.9 million tons. However, LPG exports from the Persian Gulf countries decreased by 6.4% y/y in 2023 to 40.4 million tons. Supplies from the United Arab Emirates decreased to 15.1 million tons, from Qatar they were at 9.8 million tons, from Saudi Arabia – 7.6 million tons, and from Kuwait – 5.1 million tons.
Supplies from the Arabian Peninsula accounted for 28% of world exports. Exports from the EU also decreased by 21.7% y/y in 2023 to 5.9 million tons. In terms of imports, the Chinese economy generated the greatest demand. In 2023, the PRC accounted for 22% of global imports. The country’s imports increased by 24.7% y/y in 2023 to 31.2 million tons.
EU imports decreased by 11.0% y/y in 2023 to 19.2 million tonnes. Delivery volumes to India decreased slightly, by 0.6% y/y to 19.1 million tonnes. Japan’s imports also decreased by 7% y/y to 9.9 million tonnes in the same period. South Korean imports in 2023
decreased by 13.2% y/y to 7.8 million tons. In the first quarter of 2024, global LPG exports increased from 35.5 million tons in the same period of 2023 by another 5% y/y to 37.3 million tons. The United States is currently the largest exporter of LPG in the world and generates a supply of approximately 41.5% of global volumes.

2023 LPG exports from the USA 11.9 bcf/d
U.S. The Energy Information Administration (EIA) reports that the United States exported the most liquefied natural gas in 2023. In 2023, U.S. LPG exports averaged 11.9 billion cubic feet per day (bcf/d), a 12% increase over 2022. Annual LNG exports from Australia and Qatar, the other two largest exporting countries, fluctuated during this period 2020–2023 from 10.1 to 10.5 Bcf/d. Russia and Malaysia, also significant exporters, delivered 4.2 Bcf/d and 3.5 Bcf/d, respectively, to the market in 2023.
An increase in the volume of LPG exports from the USA in 2023 was possible after the commencement of operations of the Freeport LNG terminal in February this year. and achieving full installation capacity in April this year. The Freeport LNG export terminal ceased operations in June 2022 after a fire broke out. Strong demand for LNG in Europe and high gas prices resulting from the Russian invasion of Ukraine and the subsequent decline in pipeline deliveries of Russian gas to Europe have made Europe financially attractive to gas shippers.
U.S. LNG exports set records in November and December 2023, reaching 12.9 Bcf/d and 13.6 Bcf/d, respectively. EIA estimated that export capacity utilization at seven U.S. LPG terminals operating in 2023 averaged 104% of nominal capacity and 85% of peak capacity.
The region receiving the largest volumes of US LPG in 2023 was Europe, accounting for 66% of total US LPG exports. The next recipient was Asia with 26% and Latin America and the Middle East with a total reception share of 8%.

Europe imports LPG
European countries continued to import large volumes of LPG in 2023 as global trade dynamics changed following the Russian invasion of Ukraine. In 2023, European demand and LPG import capacity increased systematically, including: thanks to activated FSRU terminals.
EIA predicts that they will increase by more than one third. US LNG exports to Japan, South Korea, China and India also increased in 2023 compared to 2022. Additionally, countries such as Vietnam and the Philippines started importing US gas in 2023.
The beneficiary of the increased supply of liquid gas from American terminals is Poland. The LNG terminal in Świnoujście received 62 deliveries of liquefied gas in 2023, Orlen informed. Thanks to contracts with partners from the United States, in 2022 58 gas carriers delivered 4.4 million tons of liquid gas to Świnoujście. 41 LNG cargoes arrived from the United States. These were deliveries partly under long-term contracts and from the spot market. 19 LNG tankers delivered gas from Qatar. One LNG transport was received from suppliers in Trinidad and Tobago and Equatorial Guinea.
The company is the only user of the terminal belonging to the gas transmission operator Gaz-System. In total, in 2023, LNG deliveries by sea amounted to approximately 4.66 million tons, as we reported here [https://www.gospodarkamorska.pl/terminal-lng-w-swinoujsciu-klejal-w-2023-466-mln- tons-of-gas-75495].
As already mentioned above, LPG exports from the USA in 2023 increased sharply by 15.% y/y to 59.9 million tons. This followed an increase of 9% y/y in 2022. In 2021, there was a temporary decline in exports of 0.3% y/y. The growth in 2020 was 17.6% y/y. In the period January–March 2024, production increased by 10.3% y/y to 16.0 million tonnes from 14.5 million tonnes in the first quarter of 2023.
LPG loading in the United States in 2023 will take place mainly at the terminals: Houston (28.6 million tons in 2023), Beaumont (14.8 million tons) and Freeport (7.2 million tons). The following terminals also operate in export relations: Marcus Hook (3.8 million tons), Corpus Christi (1.9 million tons), Ferndale (1.3 million tons), Port Neches (10.5 million tons), Geismar (0, 4 million tons).

China is the main recipient of gas from the USA
– The main recipient of American LPG is China. In recent years, traffic on this route has reached record levels. While LPG trade from the US to China stopped in 2019 (it was only 0.3 million tons!), in 2020 the United States emerged as the number one supplier of LPG to China with 6.2 million tons – reports Banchero Costa.
In 2021, LPG deliveries increased to 6.9 million tonnes, growing by 11.9% over the year. In 2022, it was already 9.2 million tons, an increase of 32.7% y/y. In 2023, China received 16.3 million tons of gas, recording an increase in supply by 77.2% y/y. China accounted for 27.2% of total U.S. maritime LPG exports in 2023. In second place is the European Union, which accounted for 12% of U.S. exports in 2023.
7.2 million tons of LPG reached the EU, which means a decrease in supplies by 4.8% y/y. However, this followed an increase of +53.7% in 2022. The United States also exported 6.5 million tonnes of LPG to South Korea in 2023, representing a 1.1% year-on-year supply decline. 6.4 million tons of gas were delivered to Japan from the USA, i.e. less by 4.2% y/y.
Banchero Costa Reserach experts report that 29% of volumes in 2023 were loaded on VLGCs (tankers with a capacity of 70+ m3), 2% on LGCs (25-70 thousand m3), 15% on MGCs (13-25 thousand m3 ) and 54% SGC (0–13 thousand m3).
Sources: LSEG, Banchero Costa, EIA