Extremely high temperatures have prompted Kuwait Petroleum Corporation (KPC) to issue several LNG spot purchase tenders recently.
Since 6th July, KPC has purchased six LNG cargoes from the spot market to meet fuel requirements in the extreme heat for electricity production.
On 2nd August, KPC awarded tender and purchased two LNG cargoes for September delivery at $10.2/$10.3 per MMBtu.
A market source talking with Reuters said that one cargo could be delivered in the second half of September and the other could be rolled over into early October delivery.
The cargoes were thought awarded to a producer.
In an earlier tender that closed on 18th July, KPC awarded two cargoes for a delivery window of 25th August/30th September at a price slightly higher than $10 per MMBtu to a producer and a portfolio company.
A market source based in the Middle East said that the requirement by KPC is based on the LNG price comparison and fuel oil and not comparable to other benchmarks.
The source added that the timing of tenders being issued was also to get a competitive price offer.
KPC began its spot procurement for the summer when it closed its 6th July tender and purchased two cargoes for around $11.1/$11.3 per MMBtu.
