LNG importer Kuwait makes first gas discovery as overseas operator offshore LNG exporter Indonesia
LNG importer Kuwait has made its first natural gas discovery as an operator offshore during a drilling campaign in the waters of LNG exporting nation Indonesia.
Kuwait Foreign Petroleum Exploration Company (KUFPEC) announced the successful commercial discovery of gas in Indonesia's Anambas Block.
KUFPEC (Indonesia) made the discovery through the successful drilling of the Anambas-2X well.
Acting Chief Executive of KUFPEC, Sheikh Nawaf Saud Al-Sabah, stated that this “exciting discovery” marked the first operated offshore exploration discovery for KUFPEC.
“It demonstrates KUFPEC’s growth and potential as an operator of offshore oil and gas projects,” added Al-Sabah.
“I am especially proud of the professionalism of the KUFPEC team, which included Kuwaiti experts who led operations on the drilling platform,” stated the Acting CEO.
The company said the well was drilled in 288 feet of water using a jack-up rig to reach a total depth of 10,509 feet.
Natuna Sea gas
Located in the Natuna Sea near an existing block in which KUFPEC is a partner, the Anambas Block was awarded to KUFPEC through a competitive bidding process in 2019.
As part of the drilling campaign, KUFPEC conducted two drill stem tests, one in the Lower Gabus formation and the other in the Intra Keras formation.
The company said its tests subsequently resulted in a stabilized combined flow rate of 7 million standard cubic feet per day of natural gas and 1,240 standard barrels per day of condensate from the two formations.
KUFPEC said it intended to conduct more tests on other formations within the same well.
The Block is fully operated by KUFPEC, which also holds the entire 100 percent participating interest. KUFPEC’s production sharing contract has a licence term of 30 years, including a six-year exploration period.
KUFPEC is the international upstream company engaged in exploration, development and production of crude oil and natural gas outside the State of Kuwait and is a wholly owned subsidiary of Kuwait Petroleum Corp.
Al-Zour LNG
Kuwait in 2021 completed its first onshore LNG import terminal, the Al-Zour facility located about 90 kilometres southeast of Kuwait City and about 16km from Kuwait’s border with Saudi Arabia.
It consists of a regasification facility capable of liquefying 130,000 cubic metres of gas per day and eight LNG storage tanks, with four in the first phase, and each with 225,000 cubic metres of capacity.
Al-Zour is the largest LNG import terminal in the Middle East and was constructed to provide fuel and power to the refining and petrochemicals industries.
Until recently, Kuwait had only imported LNG via a floating storage and regasification unit (FSRU) at the dockside of Kuwait’s Mina Al-Ahmadi port. The FSRU has been in operation since 2009.
Oil exporter Kuwait is also focusing on ramping up its own natural gas production as part of its economic growth strategy through to 2040.
The use of LNG in the Middle East is forecast to expand by around 50 percent through 2025, with much of the increase coming from Kuwaiti demand.
Singapore LNG spot cargo prices fall again to four-year lows amid over-supply and oil drop
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Singapore LNG spot cargo prices dropped to four-year lows of under US$4.000 per million British thermal units for southeast Asia, though managed to stay above the lowest levels for North Asia shipments.
GCC neighbours Qatar and UAE keep impact of recent Dolphin pipeline outage to a minimum
The Dolphin Energy natural gas pipeline from Qatar to the United Arab Emirates experienced a major technical outage for several days last month and the Qataris reportedly made LNG supplies available to its neighour if needed and kept the impact to a minimum as a sign of improving relations.
The report by Qatari television quoting news agencies said the pipeline had now been fixed and pipeline gas supplies were flowing as normal.
The pipeline is 364 kilometres in length and supplies 2 billion cubic feet of natural gas per day from Qatar’s North Field to the UAE. The North Field is also the source of Qatar's annual LNG outut of 77 milliion tonnes per annum.
The Qatar-UAE pipleine is owned by Dolphin Energy, a subsidiary of the UAE oil and gas company, Mubadala Petroleum, and with minority stakes held by French major Total and Occidental Petroleum of the US.
“The pipeline encountered a major failure in Qatar’s territory in mid-April resulting in a shutdown of all of its facilities for several days,” said the Qatari TV report.
Analysts said the report was seen as Qatar saying to its Arab neighbours in the Gulf Cooperation Council (GCC) that it can be relied upon in a crisis and to meet contracts for energy supplies.
According to the report, the pipeline shutdown caused significant curtailment of gas supplies to the UAE for several days and Qatar Petroleum helped Dolphin Energy by supplying some repair materials and offering LNG supplies to make up for any shortages.
The GCC members are UAE, Bahrain, Kuwait, Oman, Qatar and Saudi Arabia. Since the dispute began no Qatari LNG cargoes were to be delivered to the UAE and Kuwait because of GCC transport sanctions against Qatar.
The embargo against Qatar was formally imposed in June 2017, though the Qataris said at the time they would not close the Dolphin pipeline, which would cause major disruptions to the UAE’s natural gas system.
Singapore LNG spot cargo prices rise led by North Asia shipments in the second half of July
Singapore LNG spot cargo indices began moving higher in the past week and into the second half of July with North Asia shipments leading the way.
The Singapore average index for June increased to US$5.221 per MMBtu from last week’s June average of US$5.035 per MMBtu.
Singapore’s latest LNG indices released on May 2 included a price of US$4.847 per MMBtu for the second half of June of US$5.245 per MMBtu.
Prices were quoted as a surplus in global LNG supplies permeated the Northern Hemisphere summer market as other energy trading products benefited from crude oil prices this week of around $74 per barrel.
Cargo prices for the first half of July were at US$5.335 and were higher for the second half of July at US$5.415.
The Sling is an index series for LNG developed by the Singapore Exchange (SGX) and its subsidiary Energy Market Company (EMC).
It is a spot index for cargoes “on the waters in the vicinity of Singapore which could go into any port” and based on cargo sizes of 135,000 cubic metres capacity to 175,000 cubic metres capacity.
The North Asia price rose to a June average of US$5.506 per MMBtu versus last week’s June average of US$5.305 per MMBtu.
North Asia cargoes for the second half of June were also lower week-on-week at US$5.525 per MMBtu, before rising for the first half of July to US$5.625 per MMBtu, then moving even higher to US$5.730 for the second half of June.
The North Asia prices are for delivery ex-ship (DES) to all ports in Japan, Korea, Taiwan and China.
The Dubai-Kuwait-India Sling index is assessed in collaboration with London-based, inter-dealer global brokerage Tullett Prebon for regional cargoes shipped to India and the Middle East and averaged US$5.353 per MMBtu for June, an increase from last week’s June average of US$5.177 per MMBtu.
The DKI index, based on a cargo of between 138,000 cubic metres capacity and 170,000 cubic metres, is seen in the second half of June at US$5353 per MMBtu before increasing to US$5.490 per MMBtu for the first half of July.
The price for the second half of July jumped to US$5.585 per MMBtu.
The SGX LNG Index Group (Sling) is an initiative by SGX and EMC for spot LNG price discovery.
It is a benchmark based on assessments of LNG cargo value by market participants. They provide assessments based on the value of an LNG cargo at a specific location for delivery.
The Sling is based on participants submitting assessments to determine an index value.
“The participant pool consists of a broad group of market players to ensure that any Sling Assessment is as representative of actual market conditions as possible,” says the SGX, while pointing out that the participant is kept confidential at all times.
The SGX-EMC LNG prices include both lean and rich cargoes.
Singapore LNG prices edge higher with July North Asia summer cargoes setting the pace
Singapore LNG spot cargo indices began moving to levels above the $5.500 per million British thermal units mark as July quotations made an appearance for North Asia just below US$5.800.
The Singapore average index for June was at US$5.203 per MMBtu, rising from last week’s May average of US$4.876 per MMBtu.
Singapore’s latest LNG indices released on April 18 included a price of US$5.055 per MMBtu for the second half of May and higher at US$5.136 per MMBtu for the first half of June.
Prices were quoted on the basis of the surplus in global LNG supplies as Northern Hemisphere summer season trades began amid a solid crude oil price this week of over $70 per barrel.
Cargo prices for the second half of June were at US$5.270 and were higher for the first half of July at US$5.395.
The Sling is an index series for LNG developed by the Singapore Exchange (SGX) and its subsidiary Energy Market Company (EMC).
It is a spot index for cargoes “on the waters in the vicinity of Singapore which could go into any port” and based on cargo sizes of 135,000 cubic metres capacity to 175,000 cubic metres capacity.
The North Asia price increased to a June average of US$5.554 per MMBtu versus last week’s May average of US$5.100 per MMBtu.
North Asia cargoes for the second half of May were at US$5.386 per MMBtu, before rising for the first half of June to US$5.469 per MMBtu, then jumping to US$5.639 for the second half of June.
The first half of July quote for North Asia was the highest on the board at US$5.788 per MMBtu.
The North Asia prices are for delivery ex-ship (DES) to all ports in Japan, Korea, Taiwan and China.
The Dubai-Kuwait-India Sling index is assessed in collaboration with London-based, inter-dealer global brokerage Tullett Prebon for regional cargoes shipped to India and the Middle East and averaged US$5.327 per MMBtu for June, an increase from last week’s May average of US$4.990 per MMBtu.
The DKI index, based on a cargo of between 138,000 cubic metres capacity and 170,000 cubic metres, is seen in the second half of May at US$5.197 per MMBtu before increasing to US$5.253 per MMBtu for the first half of June.
The price for the second half of June jumped to US$5.400 per MMBtu and increased further for the first half of July to US$5.533 per MMBtu.
The SGX LNG Index Group (Sling) is an initiative by SGX and EMC for spot LNG price discovery.
It is a benchmark based on assessments of LNG cargo value by market participants. They provide assessments based on the value of an LNG cargo at a specific location for delivery.
The Sling is based on participants submitting assessments to determine an index value.
“The participant pool consists of a broad group of market players to ensure that any Sling Assessment is as representative of actual market conditions as possible,” says the SGX, while pointing out that the participant is kept confidential at all times.
The SGX-EMC LNG prices include both lean and rich cargoes.
Singapore LNG prices remain at three-year lows and may test level under $4.00 per MMBtu
Singapore LNG spot cargo indices remained at three-year lows as prices shed between US$0.30 per million British thermal units and $US0.60 per MMBtu compared with a week ago for May and June cargoes for North Asia and elsewhere.
Singapore LNG cargo prices find alignment with Atlantic Basin gas at high of US$5.70 for Asia
Singapore LNG cargo indices remained mostly under the $5.700 per million British thermal units mark, including shipments for North Asia in the second half of May as Pacific and Atlantic basin prices were in alignment.
