LNG

Sasol, the South African petrochemicals, energy and fuels company, has agreed to sell a 30 percent in the natural gas pipeline running from future LNG exporter Mozambique into South Africa.

Sasol will retain a 20 percent holding and continue to operate and maintain the 865-kilometres Republic of Mozambique Pipeline Company (ROMCO) link currently transporting natural gas from the Pande and Temane fields in Mozambique to Sasol's operations in South Africa.

Both the Pande and Temane gas fields are onshore and are located around 600 kilometres north of the Mozambican capital Maputo and have been in production since 2004 and 2010 respectively.

However, Mozambique has other more lucrative natural gas fields in the Rovuma Basin offshore the northeast province of Cabo Delgado, though the main onshore LNG export project being developed there by France’s Total has been suspended for now because of insecurity in the region.

Sasol, the world’s leading producer of motor fuel made from coal, is attempting to cash in assets to pay off some of its huge debts.

Sasol said the sale would net around 5.14 billion South African rand ($363M) when completed by the end of the first half of 2021.

The purchasers are South African interests, including a subsidiary of the nation’s largest pension fund firm and insurer, Old Mutual.

“Sasol will retain a 20 percent shareholding in ROMPCO and will continue to operate and maintain the pipeline in terms of the commercial agreement between Sasol and ROMPCO, which is independent of the proposed transaction,” explained the South African energy company.

“Sasol´s agreements with ROMPCO to transport gas to the Secunda plant are unaffected by the proposed transaction and the tariffs remain as per the said agreements, which were approved by the National Energy Regulator of South Africa (NERSA),” it added.

Secunda CTL is a synthetic fuel plant and petrochemicals and power complex owned by Sasol at Secunda in Mpumalanga province, about 130 kilometres (80 miles) southeast of Johannesburg.

The plant uses coal liquefaction to produce petroleum-like synthetic crude oil from coal.

The Sasol name itself comes from the acronym for South African Synthetic Oil.

The CTL project had its roots in the Apartheid era in South Africa as one way of firstly partly circumventing the global oil supply crisis of the 1970s and then international sanctions.

The first synthetic oil plant in South Africa was opened about 50 years ago at Sasolburg, an industrial site in the north of Free State province chosen for its adjacent coalfields and abundant water supplies from the Vaal River.

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.

Vietnam is making progress on developing four LNG import terminals and the latest to make a statement is one venture planned for the port city of Haiphong involving US major ExxonMobil Corp.

The governing People's Committee of Haiphong said it had approved a $5 billion LNG import terminal and power project scheduled to come on stream by 2026.

“The terminal will have a capacity of 6 million tonnes of LNG per annual and a power project built in two stages with a final generation capacity of 4,500 megawatts,” said the Haiphong authorities.

However. ExxonMobil has yet to confirm the venture, though one of its senior executives recently held talks with the Vietnamese Prime Minister.

A second Vietnamese LNG-for-Power venture is being developed by Singapore-based company Delta Offshore at Bac Lieu province in the Mekong Delta.

This project will also be built in four phases and is scheduled to be built by 2026.

A third LNG terminal is envisaged adjacent to a gas-fired power station in Ninh Thuan province, south of Cam Ranh Bay.

The fourth project is at Long An, also on the Mekong Delta, and this will see the development of a 3,000MW power plant.

Vietnam said in June 2020 that talks had taken place by telephone between Nguyen Xuan Phuc and Irtiza Sayyed, President of ExxonMobil LNG Market Development, on LNG imports and power facilities.


The Hanoi government said in a statement at the time that a power project in Haiphong could use LNG imported from the United States or other countries.

Prime Minister Nguyen Xuan Phuc had said he welcomed ExxonMobil’s willingness to invest in Vietnam in many areas, including natural gas exploration and LNG, petrochemical refining and electricity production from LNG.

ExxonMobil’s main US LNG export interests are as a shareholder in the Qatar Petroleum-led Golden Pass export project in Texas.

Qatar Petroleum owns 70 percent of the Golden Pass joint venture and ExxonMobil holds 30 percent.

Originally built as an import facility on the Sabine-Neches Waterway in Texas before the shale-gas revolution, Golden Pass will be reconfigured to export up to 15.6 million tonnes per annum of LNG.

The Bac Lieu project of Delta Offshore is the most advanced of the planned Vietnamese LNG terminal build-out and said in September 2020 it had signed a technology license agreement with Stena Power and LNG Solutions for jetty-less LNG receiving and regasification technology.

The Mekong Delta facility will employ Stena’s Autonomous Transfer System (ATS) and Self-installing Regas Platform (SRP) solutions to provide energy for its power plants.

Woodside Petroleum, the operator of the North West Shelf LNG plant in Western Australia, has emerges as the front-runner to acquire the 16.67 percent stake in the NWS facility to be sold by US major Chevron Corp. as part of its overhaul in the depressed market.

The Gazprom-run Sakhalin liquefied natural gas export plant in the Russian Far East has started maintenance work and has shut down one of its processing Trains.

Sakhalin Energy, the plant operating company, had originally planned for work to be done on both Trains at the same time, but logistical difficulties occurred caused by the Covid-19 pandemic and resulting safety measures.

The main buyers of Sakhalin cargoes are Japanese, South Korean and Chinese energy companies.

The shareholders in the plant are Gazprom with 50 percent plus one share, Royal Dutch Shell with 27.5 percent and Japanese companies Mitsui and Co. and Mitsubishi Corp. with 12.5 percent and 10 percent respectively.

Under its new plans some scheduled maintenance work has now been postponed until 2021.

“Due to current economic downturn and the pandemic challenge, we had to modify the initial turnaround scope,” said a Sakhalin Energy statement.

“To ensure the safety of our people and reliable production, the company has decided to follow the original timeline, but shut down only one Train at the LNG plant,” the company added.

LNG production at the two-Train Sakhalin plant has remained at just over 11 million tonnes per annum in recent years. The plant was Russia's first and came on stream in 2009.

The newer Yamal LNG plant started up in 2017 with output of 16.5 MTPA from three Trains and is operated by independent Russian natural gas company Novatek.

A long-planned expansion at the Sakhalin plant and the construction of a third liquefaction Train has so far failed to take place.

However, Gazprom notes that regular de-bottlenecking and equipment adjustments over the past 11 years has seen output raised to more than 11 MTPA from the nameplate capacity of 9.6 MTPA.

LNG cargoes produced and marketed at Sakhalin are supplied on a free-on-board basis and shipped by the company’s LNG carriers, “Grand Elena”, “Grand Aniva” and “Grand Mereya”.

Two other vessels, the “Amur River” and the “Ob River” carriers are used by the company under long-term charter agreements.

The International Gas Union Gas said a “huge wave” of liquefied natural gas export project liquefaction capacity is currently still in the pre-Final Investment Decision stage and standing by for development.

Swiss-Swedish company ABB said it was chosen to provide the electric propulsion and power distribution package for Southeast Asia’s first liquefied natural gas hybrid tug ordered to operate in the Port of Singapore.

ABB said its equipment, including energy storage, control and automation technology will be at the heart of the first tug capable of switching between low-emission LNG engines and zero-emission battery power.

The tug, which will operate in Singapore harbour, has been ordered by Sembcorp Marine subsidiary Jurong Marine Services for delivery from the Singapore shipyard by the end of 2020.

LNG as a fuel virtually eliminates sulphur-oxide emissions, while the Maritime Port Authority of Singapore (MPA) is also incentivizing its use to support the International Maritime Organization’s aims to halve ship carbon-dioxide emissions in the years ahead.

ABB said the project represents the first delivery of ABB’s award-winning power and distribution system, the Onboard DC Grid, for a tug application.

Leveraging the system, the vessel will be able to deploy 904 kilowatt hours of battery power for zero-emission operations, as well as for peak shaving, improving utilization of electricity use on board.

“This is a breakthrough in the tug market for the ABB’s energy storage technologies and a strong validation of Onboard DC Grid™ as the ultimate solution for power management efficiency for hybrid propulsion,” said Juha Koskela, Managing Director of ABB Marine & Ports.

“Future-proofing for a different energy mix makes particular sense for tugs and other port service vessels, as the most likely candidates to face imminent environmental restriction, added Koskela.

“This is also a great example of a local team meeting a regional priority,” he stated.

ABB noted that gas-fueled engines face a particular challenge when it comes to handling the fast-changing load capabilities demanded by tugs.

“Leveraging the Onboard DC Grid system, the tug’s engines will be able to run at variable speeds for optimized LNG fuel economy at each load level,” said the company.

“Additionally, through integration with an energy storage source, the batteries will be able to provide power to the tug’s propulsion system almost instantaneously,” added ABB.

PTTEP of Thailand, the oil and gas producer and a shareholder in LNG projects offshore Malaysia and Mozambique, remained confident of moving forward with its 2020 business plan under the current challenges, underpinned by Gulf of Thailand natural gas resources.

The Indian Ministry of Petroleum and Natural Gas said it had received several complaints of alleged corruption and irregularities against senior executives of Petronet LNG, the owner of two import terminals.

Petroleum Minister Dharmendra Pradhan said in a written reply to a question in the Indian lower house of Parliament, the Lok Sabha, that among those complained about was Petronet Chief Executive Prabhat Singh.

The Minister said that the complaints against the CEO and other executives had been forwarded to the Chairperson of Audit Committee of Petronet for appropriate action. 

Petronet shares are listed on the Bombay Stock Exchange and fell 5.5 percent on March 24 to 179.20 rupees after the allegations were made and had been at 189.70 rupees at the previous close.

The shares have declined in the past six months along with other energy stock and had reached a 52-week high of 302 rupees on the 23rd of September 2019.

Petronet is India’s largest LNG importer and CEO Singh has been at the helm since September 2015. 

His five-year term comes to an end in six months from now and he is eligible for a two-year extension of service until he achieves the age of 65 years. 

“Several complaints have been received in the Ministry of Petroleum and Natural Gas against MD & CEO, PLL and other officers of PLL regarding alleged corruption-irregularities,” said the official statement.

Asked if the government has conducted any audit of the accounts of Petronet regarding the irregularities during the last three years, the Minister said that Petronet was board-managed company and not a government company as per the Companies Act.

Petronet currently operates India’s busiest regasification facility at Dahej, north of Mumbai, with 17.5 million tonnes per annum of capacity and six storage tanks. 

The company was formed by the Government of India in 1998 specifically to import LNG and will be expanding its interests in the years ahead into areas such as fuel distribution.

Shareholders in Petronet, which began operations in 2004 are individual investors while stakes of 12. 5 percent are also held by each of the largest Indian energy players, Gas Authority of India, Indian Oil Corp., Oil and Natural Gas Corp. and Bharat Petroleum Corp.

Petronet’s Dahej import terminal is operating at full capacity while its second terminal at Kochi, in the southwest state of Kerala ,operates at just 18 percent of capacity because of a lack of regional gas infrastructure.

Australian energy company Santos reported average LNG prices of over $9 in the fourth quarter and higher sales at the Gladstone export plant in Queensland, driven by stronger upstream equity gas production and a record 393 coal-seam gas wells drilled.