Bloomberg: Sliding Gas Prices May Slow LNG Projects From U.S. to Africa

New liquefied natural gas export terminals risk delays after prices for the chilled fuel fell to five-year lows in Asia and Europe, according to the American Gas Association.

U.S. facilities approved or those close to final consent will proceed because they have purchase accords and investors, Dave McCurdy, president of AGA, said May 26 by phone from Washington. U.S. plants not yet approved may be delayed after a price rout, as well as higher build and regulatory costs, while international projects, including Mozambique LNG, could be postponed, he said.

“Those that are in the queue may have a harder time negotiating a firm contract at this stage,” said McCurdy, as the U.S. takes over the presidency of the International Gas Union for the next three years at the World Gas Conference that starts on Monday in Paris. “Global pricing has a major impact right now.”

LNG prices to Asia, the biggest consuming region, plunged 40 percent in the past year amid oil’s biggest slump since 2008 and as new production plants from Papua New Guinea to Australia come online. Producers from Royal Dutch Shell Plc to Petroliam Nasional Bhd and BG Group Plc delayed spending on LNG projects from the Pacific to North America in the past six months. MORE