S&P Global Ratings today published a the second part of a two-part commentary on the changing landscape of the liquefied natural gas (LNG) market in North America. It explores risks in contracts and counterparties after a few turbulent years, and how evolving trends effect our credit analysis for LNG projects and the wider segment.
In 2022, North America accounted for 70% of total global long-term LNG contracts, and we believe a majority will continue to be gas-linked. Sale and purchase agreement (SPA) tenors are lengthening again, mitigating some risk, while U.S. LNG pricing is also now being linked to indices other than Henry Hub, creating contracts we view as riskier. We also found U.S. upstream producers are emerging as customers and investors with a growing risk appetite.
To view the full commentary, see "Contracting And Counterparties: Navigating North American LNG’s Choppy Cs" on RatingsDirect. To view the first part of the series, see "From Lots To Lack: Liquefied Natural Gas' Wild Ride," published Jan. 23, 2023, on RatingsDirect.
This report does not constitute a rating action.
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