Top LNG Exporters, Texas and Louisiana, Drive Rise in U.S. Natural Gas Demand

Mon, July 17, 2023

U.S. natural gas demand increased by 43 percent, or 34.5 billion cubic feet per day (Bcf/d), from 2021 to 2022, according to the Energy Information Administration (EIA). In Texas and Louisiana alone, demand grew by 116%, driven largely by an increased demand for feedgas for LNG exports.

Source: EIA

Since 2016, when the first LNG export terminal, Sabine Pass, opened in Louisiana U.S., LNG exports have increased nearly 2000 percent, becoming the world’s largest LNG producer in 2022 thanks to a decade of shale discoveries and a boom in LNG plant construction. Just this year, U.S. LNG exports are set to reach 12.1 bcf/d and 12.7 bcf/d next year.

Source: EIA

Industry analysts say demand for LNG will continue this year as a number of LNG projects are currently underway or pursuing financial support with customers across the globe ready and willing to sign long-term contracts.

Texas is leading the way on this front to help meet global LNG demand. Just this week, NextDecade Corp. announced it will move forward with its $18.4 billion Texas LNG plant, Rio Grande LNG, in Brownsville, Texas. The facility is set to begin supplying customers across the world, including Europe and Asia, by 2027. In addition, there are four LNG facilities currently under construction in the U.S., three of which are in Texas- Golden Pass, Corpus Christi and Port Arthur. As those four enter service between 2024 and 2028, U.S. LNG export capacity will rise to 15.3 bcf/d and 22.3 bcf/d by 2028.

“We expect global LNG demand to grow from 399 million tonnes in 2022 to 627 million tonnes by 2035, more than a 50 percent increase,” Michael Stoppard, global strategy lead at S&P Global Commodity Insights, told Reuters.

To support this additional export capacity, several other industry projects are in the works as well. This includes the Matterhorn Express Pipeline, the Whistler Pipeline Capacity Expansion, the Permian Highway Pipeline Expansion and the Gulf Coast Express Pipeline – all of which will help move additional natural gas from producing basins to end users and consumers.

“The Texas oil and natural gas industry is an economic powerhouse providing reliable energy to meet growing demand here and aboard,” TIPRO president Ed Longanecker said to The Center Square. “These infrastructure investments will enable the Lone Star State to continue being a global leader in natural gas production, driving further economic prosperity across Texas and enhancing our nation's energy security.”

Thanks to the continued work and investment made by the Texas oil and gas industry into our natural gas infrastructure, we are helping meet LNG demand globally – not just today, but for years to come.