LNG

Australia said that liquefied natural gas demand is expected to increase by just under 2.5 percent in 2024, largely driven by the needs of customers in Asia-Pacific nations and by market dynamics in China.

The Japan Bank for International Cooperation (JBIC) has signed a US$1 billion loan agreement to help finance the Scarborough Gas Project in Western Australia to provide feed-gas supplies for the Train II development at Pluto LNG operated by Woodside Energy.

Woodside Energy, the operator of two liquefied natural gas export plants in Western Australia and the Scarborough Gas Project for LNG expansion, is seeking support from shareholders on its climate policies and urging them to attend the April 24 annual general meeting online or in person.

Moody’s Investors Service, the US ratings agency, said in a report into liquefied natural gas that Chinese demand in 2024 will be similar to last year and while European gas markets remained resilient the region’s reliance on LNG could increase price volatility.

Inpex Corp., the Japanese operator of the Ichthys LNG plant in Australia and developer of the Abadi LNG project in Indonesia, has signed a natural gas and decarbonisation deal with Ashikaga City north of Tokyo known for its historic trees, flower beds and pristine water to supply gas from the next phase of cleaner LNG projects.

The largest South Korean power and natural gas companies with liquefied natural gas commitments including imports and purchases have seen their current debts staying at high levels because of last year’s higher commodity prices and increasing interest rates.

Shipping subsidiaries of energy majors Chevron Corp. and TotalEnergies along with the LNG and gas cargoes carrier company Seapeak, have joined a global technology-led initiative for cleaner shipping.

The Methane Abatement in Maritime Innovation Initiative (MAMII) is led by SafetyTech Accelerator, a firm established by UK maritime classification society Lloyd’s Register.

“Our mission is to make the world safer and more sustainable through wider adoption of technology,” said SafetyTech Accelerator.

TotalEnergies and Chevron joins the group with Seapeak, which was formerly known as Teekay LNG and alone has over 90 gas carriers, including 50 LNG tankers.

The three companies join the now more than 20 members of MAMII, emphasising its pivotal role in addressing methane abatement within the maritime sector.

Contributions

Chevron, Seapeak and TotalEnergies have pledged to bring their valuable insights and commitment to the critical challenge of “methane slip”, an escape of gas that adds to pollution from dual-fuel engines or other technology.

The initiative has additionally selected four technology providers to produce feasibility studies on the technologies which will reduce methane emissions from ships.

“The release of unburnt methane is a key obstacle to unlocking the full environmental potential of LNG as a maritime fuel,” said a statement.

Now in its second year, MAMII was launched in September 2022 by Safetytech Accelerator, bringing together industry leaders, technology innovators and maritime stakeholders to mitigate methane emissions.

“Chevron Shipping is very pleased to join MAMII. We are committed to reducing methane emissions from our LNG carriers and MAMII is an excellent opportunity for us to work with industry leaders on sharing best practices and exploring new technologies,” said Lloyd Bland, a senior manager at Chevron Shipping.

Chris McDade, Vice President of Operations at Seapeak said that LNG was already the preferred choice versus traditional marine fuels.

“However, but even more can be done to minimise the environmental impact,” McDade added.

Partners

“As a MAMII anchor partner, our fleet will directly participate in feasibility studies, new equipment trials and testing of technical solutions to reduce or eliminate methane slip from LNG vessels,” he stated.

The initiative is currently focussed on “on-ship” trials, expanding the range of pilot projects and starting to address fugitive methane emissions covering the entire spectrum of emissions on LNG-fuelled vessels.

“As the world's third-largest LNG player, we are delighted to be joining the MAMII initiative and contribute our expertise in reducing the emissions all along the gas value chain,” said Jerome Cousin, Senior Vice President of Shipping at TotalEnergies.

“It is key for TotalEnergies to further improve the environmental benefits of LNG as a marine fuel, already a major decarbonization lever for the maritime industry,” Cousin added.

The full list of MAMII members: Capital Gas, Carnival Corp. Celsius Tankers, Chevron, CoolCo, JPMorgan, Knutsen Group, Lloyd’s Register, Maran Gas Maritime, Mediterranean Shipping Co., Mitsui OSK Lines, MISC, NYK Line, Seapeak, Seaspan Corp., Shell, TMS Cardiff Gas, TotalEnergies, UK P&I Club and United Overseas Management.

AGL Energy, the Australian power company whose plans for an LNG import terminal in the state of Victoria were thwarted by regulators and which fought off takeover interest from various quarters before having an environmental extremist take a big stake in the company, swung to a fiscal first-half net profit from a previous loss.

The US finished 2023 at the top of the liquefied natural gas exports league as shipments to Europe were ramped up to replace Russian volumes while Australia finished second because of maintenance, strikes and regulatory obstructions for future ventures and Qatar was in third place ahead of its massive expansion plans.

Chinese liquefied natural gas imports declined slightly last month with most cargoes coming from Australia and Qatar while pipeline gas imports edged higher with energy demand improving for the needs of power and industry.

Deliveries of cargoes to China’s regasification terminals in September amounted to 5.69 million tonnes, or 84 cargoes, a drop of 2.8 percent on the 5.90MT, or 87 cargoes, received in September 2022, according to data from the Chinese General Administration of Customs.

Deliveries to China in August 2023 came to 6.32MT, an increase of almost 34 percent compared with 4.72MT in August 2022.

While supplies to China were weak for many months in 2022 because of Covid-19 lockdowns in the main cities, they began to rebound in September 2022 ahead of the winter heating season.

Network

China’s main LNG suppliers to its network of 25 import terminals are Australia, Qatar, Malaysia, Indonesia, the US and the Yamal plant in Arctic Russia.

The US no longer has China as a preferred destination for now with European countries taking more cargoes in 2023 since the ending of Nord Stream pipeline deliveries to Germany and the European Union amid Western sanctions on Russia over Ukraine.

Most recently the Netherlands became the latest European country to overtake China in the overall list of recipients of US LNG.

China has now dropped to seventh place from third place last year and has been overtaken by the UK, Spain and France for uS cargoes as well as the Netherlands.

However, more winter volumes should point at China in the months ahead as the Japan-Korea Marker price for spot cargoes hit $17.305 per million British thermal units and was seen rising further in a tight market.

The September Chinese energy data also showed that pipeline natural gas imports by China increased slightly to 4.25MT from 4.21MT in September 2022.

The “Power of Siberia” pipeline from Russia is the main supplier. It runs  for 3,000km (1,865 miles) through Siberia and into northeast China and a “Power of Siberia II” pipeline is being planned to deliver gas to China via Mongolia.

Additional pipelines inside China carry the gas for a further 2,110km through eight Chinese provinces in the north to Shanghai in eastern China.

Gas supply from the “Power of Siberia” pipeline reached just over 5 billion cubic metres in 2020, then 10.4 Bcm in 2021 and rose to 15 Bcm in 2022.

The volumes of Russian pipeline gas deliveries to China in 2023 are expected to reach around 22 Bcm or more.