LNG

Shell has taken a final investment decision to proceed with the Crux natural gas field joint venture offshore Western Australia to provide more feed gas for the “Prelude” floating LNG export plant.

Thailand’s state-owned energy company said the Yadana natural gas project in neighbouring Myanmar was key to the energy security of both Southeast Asian nations and the Thais will take over the operatorship after the withdrawal of France’s TotalEnergies over human rights issues.

Pembina Pipeline Corp., the developer of the Cedar floating LNG project in British Columbia along with the Haisla First Nation, has announced that President and Chief Executive Mick Dilger had stepped down.

Global natural gas and LNG company chief executives and managers are gathering in the United Arab Emirates for the opening on September 21 of the in-person Gastech conference and exhibition at the Dubai World Trade Centre.

South Korea, the world’s third-largest liquefied natural gas importer, is feeling the impact of increasing LNG prices and has just continued a freeze on power prices into the third quarter of 2021.

The US LNG export project developer Venture Global is facing environmental challenges with multiple filings from environmental activists to the Federal Energy Regulatory Commission for the proposed project at Calcasieu Pass in Cameron Parish in Louisiana, known as the CP2 LNG project.

Global pricing agency Platts said the Japan-Korea Marker (JKM) price for liquefied natural gas assessed by the US firm rose to a record high of $20.705 per million British thermal units

Asian spot LNG prices are riding at six-year highs, as a cold spell in some countries in North Asia prompted record imports into the region.

While Platts reported the temporary record $20.705 trading level, though the February settled prices were still generally at around $15.550 per MMBtu.

The March price was at $9.550 per MMBtu and April was quoted at $6.500 per MMBtu.

Analysts said demand from Japan has pushed up North Asia spot cargo prices.

Jera Co. Inc., Japan’s biggest power generator and the world’s largest buyer of LNG, as well as other Japanese electricity and gas companies, are competing with LNG buyers in China and South Korea to secure supplies.

Platts said that the situation also meant that fewer cargoes were coming to Europe than is usual for this time of year.

The UK National Balancing Point benchmark gas price had been firm over the past week though has now fallen under $7.00 per MMBtu.

The NBP was last at $6.95 per million British thermal units while the continental European Dutch Title Transfer facility (TTF) price was lower at the equivalent of $6.35 per MMBtu.

“A major demand stimulus for the recent price increase was the cold snap across northeast Asia which has boosted gas consumption and accelerated drastic inventory draw-down in Japan, South Korea and China,” explained Platts.

“On the supply-side, production issues in countries such as Malaysia have depleted availability and led to delayed or deferred deliveries of LNG, as well as reduced volumes stipulated under long-term contracts,” it added.

US Gulf Coast LNG prices were lower. The February derivative contracts for FOB cargoes has declined to $5113 per MMBtu from
$6.400 per MMBtu.

The March price also fell back on the week to $4.883 per MMBtu from $5.929 per MMBtu. The April GCL price was from $4.532 per MMBtu.

Additionally, there have been shipping traffic constraints in the Panama Canal, meaning vessels carrying shipments from the US Gulf Coast have experienced longer shipping times into the Pacific region.

“This has meant more cargoes are expected in Asia in the later weeks of February or in March,” stated Platts.

Platts said it forecast a drop in Asia-Pacific demand through the first quarter. Even if some supply outages continue through March, prices were likely to decline.

Chevron Corp. said it restarted LNG production at Train 2 of the Gorgon liquefaction and export plant it operates on Barrow Island in Western Australia.

The Abu Dhabi Supreme Petroleum Council (SPC) has approved 448 billion dirhams ($122 billion) in capital expenditure for national oil and gas company and LNG exporter Abu Dhabi National Oil Co. (Adnoc) through 2025 as it also pursues growing joint ventures, especially in unconventional natural gas to make the United Arab Emirates self sufficient.

Höegh LNG, the Norwegian project company and fleet owner, said it was business as usual on the high seas, at import terminals for deliveries and production plants for liftings despite the challenges.