LNG

Japanese utility Inpex has signed preliminary deals with BP and Shell Eastern Trading, as well as the Indonesian companies PLN Energi and Perusahaan Gas Negara, to offtake LNG from the 9.5 mtpa Abadi liquefaction project. The accords take the project closer to a final investment decision (FID) in 2027.

March 27 (LNGJ) - Inpex Corp. , the Japanese oil and gas major and operator of the Ichthys LNG export plant at Bladin Point near Darwin in Australia’s Northern Territory and developer of the Abadi LNG project in Indonesia, said that annual revenues declined by 6.5 percent to 2.164 trillion yen ($14.3Bln) from 2.316 trillion yen in 2022. Net profits dropped 35.5 percent to 321.7Bln yen ($2.12Bln) from 498.4Bln yen in the previous year as LNG and petroleum prices declined.

   The Tokyo-based company said that adjusted profits from the Ichthys LNG plant in 2023 amounted to 364.6 billion yen ($2.4Bln), which was an 8.8 percent return on invested capital (ROIC) on the joint venture. Inpex’s average realised natural gas price dropped by 18.2 percent to $5.62 per million British thermal units from $6.87 per MMBtu in 2022. “Inpex increased exploration activities surrounding the Ichthys gas field and for the Bonaparte carbon-capture and storage offshore Australia,” it added in a presentation. Inpex’s net sales revenues from crude oil decreased by 9.3 percent to 1,608 trillion yen ($10.62Bln) in 2023.

UK major Shell reported much reduced third-quarter profits of $6.2 billion, lower than the $9.45Bln of profits returned in the same three months of 2022 as natural gas prices dropped, while quarterly sales of liquefied natural gas were still over 16 million tonnes.

Indonesia’s Minister of  Energy and Mineral Resources Arifin Tasrif said 68 of the country's 128 oil and gas basins remained entirely unexplored and that international energy companies would receive better terms for exploration and production in the country where the Abadi LNG project is advancing along with the Tangguh LNG expansion.

Malaysian energy company Petronas and Indonesian state-owned oil and gas company Pertamina have agreed with Shell to jointly acquire the UK company’s minority Masela natural gas block in Indonesian waters that will underpin the Abadi LNG export project in Indonesia and boost future cargo availability in the Pacific Basin.

Inpex Corp., the leading Japanese liquefied natural gas developer and operator in the Asia-Pacific region, is focusing on re-assuring shareholders and the public in Japan on the company’s safety and security by organising facility tours of the Naoetsu LNG Terminal in Joetsu City in Niigata Prefecture.

Indonesia has approved a revised plan of development costing $3.35 billion for the Merakes and Merakes East natural gas fields to serve the nation’s main LNG export plant through to at least 2032.

The project fields are operated by Italian energy company Eni and one is already a supplier since April 2021 for the onshore Indonesian Bontang LNG plant in East Kalimantan province.

The Bontang plant has a nameplate capacity of 11.5 million tonnes per annum.

“The development of this field will provide additional reserves to ensure supply to the East Kalimantan system so that the Bontang LNG facility can operate at an optimal level,” said Dwi Soetjipto, the Chairman of the nation’s Upstream Regulator SKK Migas.

Investment for the Merakes fields was initially set at $1.3 billion with peak production at 368 million standard cubic feet per day.

Indonesia has two other onshore LNG facilities, the Tangguh plant with 7.6 MTPA and the Donggi-Senoro plant with 2.0 MTPA of output.

The Tangguh plant is operated by UK major BP and is currently undergoing an expansion with the construction of a third Train.

Tangguh began operations in West Papua province in 2009 and has delivered about 1,500 LNG cargoes to global markets.

Another Indonesian LNG project is expected to move forward soon with Japanese energy company Inpex Corp. finalizing its revised development plan for the Abadi project.

Inpex is planning to build an Asia-focused LNG export plant on Yamdena Island in the Tanimbar chain in a joint venture with Shell Plc using feed-gas from the Abadi gas field in the Masela Block of Indonesia's Arafura Sea.

The liquefaction and export plant could be expected to be operational by around 2028.

Inpex has already completed preliminary front-end engineering and design for a facility with projected annual initial capacity of 10.5 MTPA.

Indonesia, a leading Asian LNG producer, has approved a plan of development for the Tuna offshore natural gas field with total estimated investment at over US$3.0 billion and in the face of continued Chinese claims to sovereignty over most of the South China Sea where the field is located.

Inpex Corp., the Japanese developer of the Ichthys LNG export project in Australia, has turned its mind again to finding natural gas resources onshore Japan by starting exploratory drilling operations at the Minami-Nagaoka Gas Field in Niigata Prefecture.

Intercontinental Exchange, the leading operator of global energy derivative exchanges and clearing houses, is planning to launch its oil future contract for liquefied natural exporter Abu Dhabi on March 29, backed by leading LNG sector players.

The exchange said that that trading on the ICE Murban Crude Oil Futures (IFAN) is going ahead subject to the completion of regulatory approvals

The IFAN futures debut in the markets had been delayed in 2020 by the market oil market slump and the Covid-19 pandemic.

“We are making good progress on securing the regulatory approvals necessary for launch. We have received approval from the Bank of England for ICE Clear Europe to clear contracts traded on IFAD and IFAD is now a Recognized Market Operator by the Monetary Authority of Singapore,” explained Jamal Oulhadj, President of ICE Futures in Abu Dhabi.

“We believe that the combination of our partners, ICE’s extensive global energy network and customer base, and the capital efficiencies created by clearing Murban alongside Brent, West Texas Intermediate, and Dubai, mean that Murban futures should have a deep base of support as the market uses the futures to buy, sell and hedge Murban crude,” added Oulhadj.

The Murban Crude Oil Future is a physically delivered contract, basis free-onboard (FOB) cargo at the Fujairah loading terminal in the UAE.

The contract will provide users with an effective hedging instrument for Arab Gulf crude oil and other grades of trading into the Asia-Pacific region.

Abu Dhabi also produces LNG as well as oil for the United Arab Emirates and is aiming to increase its natural gas resources by investing more in exploration and production in the next few years.

It currently produces around 5.8 million tonnes per annum of LNG at the Das Island liquefaction plant off Abu Dhabi.

In addition to the approvals from the Bank of England and Monetary Authority of Singapore, ICE Futures Abu Dhabi said it had completed the relevant regulatory processes or analysis required to permit direct access to IFAD from a range of jurisdictions including Abu Dhabi Global Market, the United States, Switzerland, the Netherlands, France, Norway, Australia, Japan and South Korea.

Contracts traded at IFAD will be cleared at ICE Clear Europe, a leading energy clearing house, and will clear alongside ICE’s global energy futures platform covering oil, natural gas and the environmental complex, allowing customers to benefit from associated margin offsets.

Inpex Corp., the Japanese oil and gas company with stakes in major LNG export plants and projects such as Ichthys and Prelude FLNG in Australia and Abadi LNG in Indonesia, is one of the companies that IFAD venture.

The other energy companies joining the launch of IFAD include Royal Dutch Shell, BP of the UK, PetroChina, Total, PTT of Thailand, Japan’s JXTG Nippon Oil & Energy and the international commodities traders Vitol.