In this issue

 

Shale gas from the US has been brand marked as ‘a new rival’ by the Gas Exporting Countries Forum (GECF) as it undermines the alliance’s strategy on pricing and production volumes. Leaders of Russia and Iran, whose countries hold 44% of global gas reserves, have forged closer ties at the side-lines of latest Gas OPEC meeting in Tehran to rise by 1.5 Bcf/d in 2016 despite declining rig counts – largely thanks to improved efficiency in shale gas drilling. 

Pieridae Energy, the developer of the Goldboro LNG project in the Canadian province of Nova Scotia, has forged a shareholder relationship with Orlan of Poland, strengthening its European ties beyond the long-term sales agreement with E.ON Global Commodities. 

Houston-based Targa Resources Partners and Sanchez Energy have committed to invest an intital $125 million and $115m, respectively, to build a LNG processing plant and feed-gas pipelines that will exclusively target resources in the Eagle Ford Shale in southern Texas. 

Two companies involved in $100 billion of takeover transactions, BG Group of the UK and Energy Transfer Equity (ETE) of the US, have received full regulatory approval to proceed with the transformation of the existing Lake Charles LNG import terminal in Louisiana into an export plant. 

Clean Energy Fuels Corp., the US developer of a liquefied natural gas fueling station network welcomed the passage by Congress of an alternative fuel tax credit that will continue to support the use of natural gas as a transportation fuel option. 

Committing to a 36% cut in emissions per GDP ratio by 2030, Singapore is counting on clean energy. Natural gas accounts for over 95% of the city state’s power mix, up from just 19% in 2000, but the government eyes even more LNG-to-power plants as well as renewables. 

Tuesday, 16 February 2016

Higher prices of LNG compared to coal and nuclear is prompting two of the biggest importers in Asia to move away from gas generation.

Tuesday, 01 December 2015

A supply gap is likely to open up by the end of the decade and to prevent this, the industry should reduce costs of liquefaction, e.g. through small FLNG units, suggests Philip Olivier, CEO of ENGIE Global LNG.

Privately-owned ENN of China is close to finalising deals for LNG imports into Zhoushan terminal, due operational in 2018. "We'll have a minimum of 1mtpa for sure, possibly 2mpta, and are in talks with several players," ENN vice-president Ma Shenyuan said.

Rebuking criticism of the oil & gas industry, BG's chief executive Helge Lund has called for "courage to continue investing in difficult times," while ensuring shorter cash-flow returns. "Otherwise we're simply setting ourselves up for the next boom," he said at the Gastech opening in Singapore.

Gazprom's pricing strategy for exports to Europe is a wildcard that will determine how much US LNG will find a home there. It's revenue vs market share, analysts at the Gastech conference in Singapore agree.

Buyers, spoilt for choice, have adopted a 'wait & see approach' but QatarGas does not see itself challenged. "We're optimising our established position but are not competing with US LNG," Alaa Abu Jbara, COO Commercial and Shipping at QatarGas said in Singapore.

Exports of US LNG to Europe will not be a game changer so "I see us more as a price taker in Europe," Charif Souki, chairman and CEO of Cheniere Energy said, suggesting Russian gas will continue to dominate much of the region.

LNG buyers and sellers in Singapore will soon be able to trade gas domestically at a secondary market, allowing power producers to hedge their gas imports and rely less on oil-indexed contracts.

News Nudges

Rio Grande LNG gears up for stock market listing

Next Decade is following the trend of US Gulf Coast liquefaction projects to get their project companies listed on the stock exchange. Kathleen Eisbrenner’s NextDecade has signed a letter of intent for a business combination transaction that will allow the privately-held company to become a publicly-listed company. To that end, Eisbrenner is using the services of Harmony Merger Corp. The listing is meant to ease the fund-raising process for Next Decade’s 27 mpta Rio Grande LNG project that is currently advancing through the FERC permitting process. Tellurian Inc., meanwhile, recently completed a reverse takeover of a small oil and gas exploration firm to gain a Nasdaq-listing that is meant to boost the prospects for Driftwood LNG.


Driftwood LNG aims to raise $200m in Nasdaq listing

Preparing a first share offering, Tellurian in mid-March issued a prospectus proposing to sell shares valued up to $200 million on the Nasdaq Capital Markets stock exchange. Tellurian Inc., developer of the Driftwood LNG project in Louisiana, recently chose SG Americas Securities to provide a financial strategy for the venture. SG Americas is the US broker-dealer subsidiary of France's Societe Generale. Charif Souki, Tellurian founder and ex-Cheniere Energy chairman, completed a reverse takeover in February 2017 to get Tellurian listed in a move to efforts of ease fund-raising. Meg Gentle, president and CEO, said that with SG’s expertise at hand, financial structuring of Driftwood LNG would advance swiftly, hence “we anticipate construction in 2018 and first LNG from Driftwood in 2022.”


CB&I ‘optimistic’ for growth

Philip K. Asherman, President and CEO of US engineering and construction company Chicago Bridge and Iron (CB&I) said he was “optimistic” that stability in commodity prices and major capital programs, particularly in North America and the Middle East, “will result in resumption of substantial backlog growth by mid-year of 2017.” CB&I posted an operating loss of $665.6 million last year but Asherman stressed that all proceeds from the divestiture of the company’s Capital Services business will be spent to reduce debt to optimize the balance sheet. The firms Engineering& Construction (E&C) backlog was $9.9 billion in December 2016 versus $12.8 billion at the end of the previous year.


First gas for Kosmos-BP FLNG Train 1 eyed in 2021

Kosmos Energy is drilling an exploration well with total discovered resource of 25 Tcf of feed-gas. The US firm cooperates with BP on plans to produce LNG floating hulls offshore Senegal and Mauritania; to that end it successfully drilled the Teranga-1 exploration well in 2016. First gas from Kosmos-BP FLNG Train 1 is scheduled for 2021, the company said, and the start of FLNG Train 2 is set for 2023.


Sabine Pass Train 3&4 to come onstream in 2017

Cheniere Energy, owner of the Sabine Pass liquefaction plant in Louisiana, the first US LNG export facility, said transition and execution will remain central themes for Cheniere in 2017. “We expect Trains 3 and 4 at Sabine Pass to begin commercial operations, with Train 3 having produced its first commissioning cargo in January,” Jack Fusco, Cheniere's President and CEO stated when presenting the company’s annual report. Once all six Trains come on stream, Sabine Pass will have a have nameplate capacity of 27 mtpa. Corpus Christi LNG, Cheniere’s second venture on the Texas Gulf Coast, is designed to produce an initial 13.5 mtpa, with Trains 1 and 2 expected “to reach substantial completion in 2019.”