New US LNG Project Margins Dropped Amid Higher Costs

New US LNG project costs have nearly doubled over the past eight years cutting profit margins as long-term contract LNG prices have dropped according to Freeport CEO, Michael Smith.

• “There is a high likelihood that some of the second wave LNG terminals, they’re going to find out that it takes longer, costs more and their margins are very poor at the prices they sold their capacity,” Smith said.
• The Biden administration pause on new export permits is hurting developers and customers are uncertain about committing to long-term US.
• “It sends a bad message and others around the world will be trying to fill the gap in exploiting it,” Smith said.