US Natural Gas Production, Exports of Natural Gas via LNG and Pipelines, All Soar to New Records in 2023, Price

The US became the largest LNG exporter in the world in 2023. It has long been the largest natural gas producer in the world.

By Wolf Richter for WOLF STREET.

Annual natural gas marketed production in the US rose by 4.7% to a record 41.3 trillion cubic feet in 2023, according to EIA data. Natural gas production has surged by 113% since 2006, and by 41% since 2017, as a result of the massive US fracking boom that reshaped the energy landscape and pricing in the US and globally.

Some milestones:

• In 2009, the price of US natural gas collapsed amid overproduction from fracking, and no LNG export terminals in the lower 48 states.
• In 2011, the US became the largest natural gas producer in the world, with prices wobbling along collapsed levels.
• In 2016, natural gas became the dominant fuel for power generation in the US, beating coal.
• In 2016, the first LNG export terminal in the lower 48 states came on line, and large-scale LNG exports began.
• In 2023, the share of natural gas rose to another record of 42.7% of total power generated in the US.
• In 2023, the US became the largest exporter of liquefied natural gas (LNG) in the world for the first time, beating Quatar and Australia.

And the US natural gas price collapsed.

On February 20, the price of natural gas futures plunged as low as $1.53 per million Btu, coming just within a hair of the lows since the early 1990s. Before 2009, it had largely ranged between $4 and $13. On Friday, the collapsed price of natural gas futures traded at $1.89 per million Btu.

US natural gas exports.

The US has exported natural gas via pipelines to Mexico since the late 1990s, and to a lesser extent to Canada (from which the US also imports natural gas). And the US has long had a small LNG export terminal in Alaska.

But large-scale exports of LNG to the rest of the world was impossible until the first large-scale LNG export terminal on the Gulf Coast began operating in 2016. And as more export terminals were built, the LNG export boom took off, providing more demand for US production, but US production skyrocketed, inundating the US with supply – hence the renewed price collapse.

Total exports of natural gas via LNG to the rest of the world, and via pipelines to Mexico and Canada spiked by 10.2% in 2023 to a new record of 7.6 trillion cubic feet, or roughly 18% of US marketed production.

Exports via LNG spiked by 12.4% to a record 4.34 trillion cubic feet in 2023.

Exports via pipeline to Mexico and Canada jumped by 7.6% to 3.27 trillion cubic feet in 2023. The US imports no natural gas from Mexico. But it imports more natural gas from Canada than it exports to Canada.

Net exports (exports minus imports) of natural gas soared to 4.7 trillion cubic feet. The US had long been a net importer of natural gas, with ever increasing imports. But fracking changed the equation. As production soared starting in 2007, imports began to fall, and net exports – a negative number at the time – became less negative.

In 2017, the US became a net exporter of natural gas, exporting more than importing, and net exports have continued to soar. The flat part in 2022 occurred because of the shutdown of the Freeport natural gas liquefaction plant in Texas, after a major fire, which cut LNG export capacity by 17% for the second half of 2022.

LNG Exports by region. Europe was for the second year the largest buyer of US LNG. Exports to Europe rose to a record 2.70 trillion cubic feet in 2023, accounting for 62% of US LNG exports (red line in the chart below).

Asia had been the biggest buyer of US LNG, at first Japan and South Korea, then also China and India. In 2021, exports of LNG to Asia reached a record 1.68 trillion cubic feet. But in 2022, as sales to Europe soared, sales to Asia plunged. In 2023, sales to Asia rose to 1.14 trillion cubic feet, roughly even with 2020.

Latin America and the Middle East (mostly Turkey and Kuwait) have been smaller buyers of LNG:

Enjoy reading WOLF STREET and want to support it? You can donate. I appreciate it immensely. Click on the beer and iced-tea mug to find out how:

Would you like to be notified via email when WOLF STREET publishes a new article? Sign up here.