In this issue

 

Initial optimism of global LNG suppliers that South Korea’s new electricity policy might lead to higher demand growth has been replaced by the recognition that more needs to be done for natural gas to replace coal and nuclear in Korea's power generation mix. The 13th Long-term Natural Gas Supply Plan for 2018 to 2031, released by the Government on April 5, anticipates LNG demand to reach 40.5 million tons (Mt) by the end of the forecast period, up just 3 Mt from 2017-levels.

Mexico is developing a series of privately-owned pipelines a floating LNG import facility, as part of a historic build-out of the nation’s gas infrastructure. State-owned Cenagas, operator of Mexico's main l gas transmission network, is overseeing the programme and the energy regulator CRE, is providing technical guidance. 

Crippling gas supply shortages have become a thing of the past in Bangladesh as the country started importing LNG. The maiden cargo arrived on April 23. Going forward, Petrobangla seeks to secure attractive short-term deliveries and snap up spot LNG cargoes – some of them might well carry liquefied shale gas from U.S. 

Regardless of soaring costs, LNG imports by India increased 16.8% in March compared with the year-ago period. Supply from Qatar and Nigeria was complemented by the first shipment of US LNG on March 30 – the start of a 20-year supply contract between Cheniere Energy and Gas Authority of India (GAIL).

Tellurian Inc., the developer of the Driftwood LNG project, has set aside a pool of around $280 million for executive bonuses, including up to $35 million for CEO Meg Gentle as the construction work proceeds near Lake Charles in Louisiana. 

Chart Industries, the US LNG and energy equipment maker, has returned to a first-quarter profit following internal restructuring and amid a rise in its order-book. Order activity has risen 53%, or $111.4 million ($74.4 million excluding Hudson Products) above the first quarter of 2017,” said Chart with reference to its acquisition of rival Hudson.

Lake Charles LNG, the liquefaction project owned by the U.S. pipeline company Energy Transfer, has asked regulators to extend the deadline for the start of construction to November 2019. 

Australian commodities company BHP Billiton is continuing to exit its onshore assets in the southwest of the United States, and is awaiting bids. “We expect to receive bids by June 2018 and proceed with negotiations to potentially announce one or several transactions in the first half of the 2019 financial year,” BHP said.

Dominion Energy, owner of the Cove Point LNG facility in Maryland, is pulling out all the stops to acquire Scana Corp and its South Carolina natural gas and power assets. Regulatory approval for the merger is still pending. Now Dominion put forward a study, saying the merger would bring a $18.7 billion boost to the economy of South Carolina. 

Gauging incremental gas demand, derived from new gas-fired power plant projects worldwide, Energy Aspects pointed out that most of Asia’s new capacity is “supportive of additional LNG demand,” while North American projects are “all likely to be fed by local shale gas. Most new CCGTs, however, are being built in gas-rich countries.

CLP Power, developer of a new unit at Black Point Power Station (2,500 MW) in Hong Kong, has selected Shell to supply LNG to fuel the mega plant. The new 600 MW unit is scheduled to start operations by 2020, according to CLP Power’s latest annual report, with LNG to be imported via a floating storage and regasification unit (FSRU) moored just south of Hong Kong.

Saudi Arabia, the world’s largest oil producer, is about to join Kuwait and the UEA in buying attractively-priced LNG. Khalid Al-Falih, the Saudi energy minister, did not rule out buying LNG from Russia although he sees it as “not the most economical option.” Rival and possibly more attractively-priced supply could come from East Africa and the United States. 

Tellurian Inc, developer of the Driftwood LNG project, has confirmed Bechtel Oil, Gas and Chemicals had made a $50 million investment in the company. The investment was made on the basis of a preferred equity investment with an implied Tellurian common share price of $8.16 per share. 

Record results in shale oil and gas output in Appalachia and the Permian basin have been helped by President Donald Trump’s latest changes to the US corporate tax law. Several shale gas drillers reported hundreds of millions in savings after being allowed to re-measure their net tax liabilities, and are now budgeting less tax expenses for the future. Production among American shale drilling companies, sampled by the consultancy Energy Aspects, grew by 1.6 Bcf/d, or 5% year-on-year and 0.5 bcf/d, or 2% quarter-on-quarter in Q4-2017. 

News Nudges

FERC ends plans for Puerto Rico LNG expansion

“Aguirre Offshore GasPort requests that FERC vacate its 2015 order authorizing the construction and operation of LNG import terminal facilities along the southern shore of the Commonwealth of Puerto Rico near the municipality of Salinas,” FERC said, adding: “In its request to vacate, Aguirre stated that it no longer intends to proceed with the project, that no construction has been undertaken, and that no facilities are in service.” The Aguirre project company filed its last status report in June 2018 to the regulator to keep its permit process up to date, but later gave notice that the venture was not proceeding. The FERC notice has finally pulls the curtain down for now on plans for LNG expansion in Puerto Rico. Excelerate Energy had previously agreed to provide a floating storage and regasification unit (FSRU) for the Aguirre project in 2019, but was forced to cancel its contract with the bankrupt Puerto Rico Electric Power Authority. The FSRU was to have been deployed offshore Salinas and would also have had a 6.4 kilometres pipeline to provide regasified LNG to the Aguirre power station.