The shale gale that has put the United States on track to soon be a net exporter of natural gas also is shaking up the international market for the fossil fuel, forcing Trinidad and Tobago to adapt by selling more of its supplies to Europe and Asia.
The Caribbean country’s liquefied natural gas exports — once mostly shipped to the United States — are increasingly feeding hungry Asian markets, Trinidad and Tobago’s energy minister Kevin Ramnarine told Platts Energy Week.
While “Trinidad is still the largest supplier of LNG to the U.S., . . . the absolute volume that the U.S. is buying has dwindled by a fact over of four over . . . the last four years,” Ramnarine said on the syndicated energy news show.
According to Platts, the United States bought roughly 80 percent of Trinidad and Tobago’s exported liquefied natural gas as recently as six years ago, but the stat has since been turned on its head. While the United States deals with its own glut of domestically harvested natural gas, the island nation has “adapted” and found new customers for the fossil fuel, Ramnarine said.
Export debate: Asian nations eagerly eye cheap US natural gas
Now, the country is shipping about a third of its liquefied natural gas exports to South America (where the average price is around $10 per million BTUs, in contrast to Asian prices ranging from $14 to $17 per million BTUs). About 19 percent of Trinidad and Tobago’s LNG still goes to the United States, and the country is separately serving Asian and European customers.
Michael Levi, a senior energy fellow at the Council on Foreign Relations, told a House subcommittee last week that the decline in U.S. demand for natural gas from other countries is already weakening the domination of Russia in the European market. Potential U.S. natural gas exports could further erode Russia’s pricing power.
Trinidad and Tobago is counting on the newly widened Panama Canal — on track to be finished next year — will make it easier for the nation to supply Asian customers eager for natural gas to replace nuclear power.
Wider opportunity: Panama Canal project could boost natural gas exports
The widening of the Panama Canal will allow LNG barges from Trinidad to make their way to Asia without navigating around Argentina and Chile, lowering transport costs. Other countries such as Australia, stand to benefit from the expanded shipping option too.
Ramnarine predicted the change “will enhance the economics of selling LNG to Asia and (will) make us more competitive in the Pacific Basin.”