199. The LNG Mirage - Oct25
Redefining Energy
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Supply Constraints: U.S. Gas Limits and Price Risk
Justin argues that rising US LNG exports will strain domestic gas supply and push Henry Hub prices much higher.
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The oil and gas industry is clinging to the narrative that we're entering a "Golden Age of Gas" — especially when it comes to LNG. Riding this assumption, companies have been pouring in investments at an aggressive pace, with plans to double LNG export capacity by the end of the decade.
US LNG FIDs are breaking all records in 2025, with 55 mtpa of liquefaction capacity sanctioned since the start of the year. This is the second-best year for global LNG FIDs (Final Investment Decision), second only to 2019, when over 70 mtpa of FIDs .The latest example is the 14bnUSD FID for Sempra’s Port Arthur 2 in Texas in September 2025, mostly financed by large funds Blackstone, KKR, Apollo, Goldman Sachs.
Currently, LNG exports make up about 16% of U.S. gas consumption. Projections suggest that figure could rise to 30% by 2030. But two major uncertainties loom large:
Demand: Will international markets absorb this flood of LNG? China's pivot toward Russian and Central Asian pipelines, Qatar’s own ramp-up in production, and Europe’s push to reduce reliance on expensive imported gas all cast doubt on future demand.
Supply: Will the U.S. have enough cheap gas to meet this export surge — especially as the AI boom is expected to drive up domestic gas use, while the federal government places increasing restrictions on renewable energy development?
To unpack these critical questions, we’ve invited Justin Mikulka to explore what he calls the “LNG Mirage.” He’ll walk us through hard-hitting facts and trends that investors are currently overlooking. At events like CERAWeek and Gastech, the fossil fuel industry often seems to talk only to itself — echoing reassurances while ignoring warning signs. But winter is coming.
About the Speaker:
Justin Mikulka has spent the past decade investigating and reporting on the energy sector, with a particular focus on the shifting economics between fossil fuels and emerging clean technologies. He publishes regular insights at Powering the Planet and currently serves as the Communications Director at Oilfield Witness, a U.S.-based nonprofit that uses optical gas imaging to document methane emissions from the oil and gas industry.
Reports in reference: Global Gas Flaring Tracker Report from World Bank https://thedocs.worldbank.org/en/doc/bd2432bbb0e514986f382f61b14b2608-0400072025/original/Global-Gas-Flaring-Tracker-Report-July-2025.pdf
We thank Abloco Energy for supporting the show. www.abloco.energy
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Epilog post recording:
"Venture Global shares plunged more than 20% on Friday following its loss in an arbitration case against BP, which accused the US liquefied natural gas producer of breaching contracts to profit from higher prices at the start of Russia’s full-scale invasion of Ukraine.The case was one of several pursued by Venture Global’s customers alleging it failed to deliver shipments under long-term supply contracts and instead sold them for higher prices on the spot market when gas prices soared in early 2022.BP’s victory is a major blow to one of the largest US LNG exporters, which now faces a separate hearing to determine damages in the case. The UK oil group is seeking damages in excess of $1bn, as well as interest, costs and attorneys’ fees."
US LNG FIDs are breaking all records in 2025, with 55 mtpa of liquefaction capacity sanctioned since the start of the year. This is the second-best year for global LNG FIDs (Final Investment Decision), second only to 2019, when over 70 mtpa of FIDs .The latest example is the 14bnUSD FID for Sempra’s Port Arthur 2 in Texas in September 2025, mostly financed by large funds Blackstone, KKR, Apollo, Goldman Sachs.
Currently, LNG exports make up about 16% of U.S. gas consumption. Projections suggest that figure could rise to 30% by 2030. But two major uncertainties loom large:
Demand: Will international markets absorb this flood of LNG? China's pivot toward Russian and Central Asian pipelines, Qatar’s own ramp-up in production, and Europe’s push to reduce reliance on expensive imported gas all cast doubt on future demand.
Supply: Will the U.S. have enough cheap gas to meet this export surge — especially as the AI boom is expected to drive up domestic gas use, while the federal government places increasing restrictions on renewable energy development?
To unpack these critical questions, we’ve invited Justin Mikulka to explore what he calls the “LNG Mirage.” He’ll walk us through hard-hitting facts and trends that investors are currently overlooking. At events like CERAWeek and Gastech, the fossil fuel industry often seems to talk only to itself — echoing reassurances while ignoring warning signs. But winter is coming.
About the Speaker:
Justin Mikulka has spent the past decade investigating and reporting on the energy sector, with a particular focus on the shifting economics between fossil fuels and emerging clean technologies. He publishes regular insights at Powering the Planet and currently serves as the Communications Director at Oilfield Witness, a U.S.-based nonprofit that uses optical gas imaging to document methane emissions from the oil and gas industry.
Reports in reference: Global Gas Flaring Tracker Report from World Bank https://thedocs.worldbank.org/en/doc/bd2432bbb0e514986f382f61b14b2608-0400072025/original/Global-Gas-Flaring-Tracker-Report-July-2025.pdf
We thank Abloco Energy for supporting the show. www.abloco.energy
----
Epilog post recording:
"Venture Global shares plunged more than 20% on Friday following its loss in an arbitration case against BP, which accused the US liquefied natural gas producer of breaching contracts to profit from higher prices at the start of Russia’s full-scale invasion of Ukraine.The case was one of several pursued by Venture Global’s customers alleging it failed to deliver shipments under long-term supply contracts and instead sold them for higher prices on the spot market when gas prices soared in early 2022.BP’s victory is a major blow to one of the largest US LNG exporters, which now faces a separate hearing to determine damages in the case. The UK oil group is seeking damages in excess of $1bn, as well as interest, costs and attorneys’ fees."
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