LNG

Gunvor Group, the global commodities and energy trader, has released its annual results showing it delivered 16 million tonnes of liquefied natural gas, though overall revenues dropped by more than half because of lower prices.

Gunvor trades in energy from its main offices in cities such as Geneva in Switzerland, Singapore, the Chinese city of Shanghai and Houston in Texas.

The company, which also owns assets such as oil refineries in Rotterdam in the Netherlands and Antwerp in Belgium, reported revenues for 2019 of US$75 billion, a decrease of 54 percent, or US$87Bln, from 2018 when it had income of US$162Bln.

The group’s annual net profits after taxes came to $381M.

“Gunvor’s performance in 2019 was broad-based across all geographies and trading desks, and as a result the company realized strong trading gross profit,” it said.

Total trading volumes increased to 198 million MT from 184 million MT in 2018, mainly due to an increase in the trading of natural gas and LNG.

Gunvor said performance were particularly good at the US trading operations on Houston and Stamford, Connecticut.

“A solid contribution came from the European oil refining network and oil trading activity,” it added.
Gunvor said that “transitional” commodities like natural gas, LNG, liquefied petroleum gas and biofuels comprised 45 percent of total trading activity, an increase from 28 percent in 2018.

It also stated that the corporate overhaul it undertook in 2017 and 2018 to improve risk management and corporate governance enabled the company to effectively take advantage of favourable market conditions throughout the year.

“Gunvor subsequently entered 2020 with a strong balance sheet and liquidity position to meet the unexpected events, and posted a profit for the first quarter,” it explained.

Gunvor said it seamlessly transitioned to work-from-home at all offices across the globe, and trading activities remained unaffected by the Covid-19 pandemic.

“The company has continued to hire and undertake all normal core business operations. Trading performance remains strong across all geographies and desks, including shipping (with more than 100 vessels owned or under long-term charter),” it said.

However, Gunvor noted that the European refining sector was expected to remain challenging for the foreseeable future.

Regardless of the current market environment, Gunvor said it continued to view the long-term challenge for companies in the physical energy commodities trading sector to be effectively positioning themselves within the “energy transition”.

Gunvor acquired two biofuel plants and committed to no longer physically trade coal and activities ceased in 2018.

Trafigura, the international commodities firm, said its delivered liquefied natural gas volumes rose by 22 percent in the past year as demand rose in both China and South Korea and it expected a bouyant 2019.