LNG

Fortum, the Finnish energy and power company with European Union-wide operations and that was forced to give up the German natural gas and energy supplier Uniper which had relied on Russian pipeline supplies from Gazprom, reported another substantial drop in profits.

April 29 (LNGJ) - Russian natural gas production is expected to increase by 4.6 percent in 2024 to 666.7 billion cubic metres, while pipeline gas exports are forecast to rise by 7 percent to 108 Bcm. Russia’s Non-Commonwealth of Independent States natural gas prices for nations such as China and Turkey are expected to be at the level of around $297.3 per 1,000 cubic metres in 2024.

   The official Russian data said that LNG exports are forecast to grow by 14 percent to 38 million tonnes in 2024, though no provision is included in the data for tougher sanctions against Russian LNG currently being considered by the European Union. “Gas production is expected to continue growing to 695.4 Bcm in 2025 and pipeline gas exports will grow to 120 Bcm in 2025,” the report said.

RWE AG, the German utility with LNG import interests at Brunsbüttel on the Elbe while also being involved in coal-fired generation and energy trading, reported improved earnings.

Equinor, the leading supplier of pipeline natural gas to Europe, and the State Oil Company of Azerbaijan Republic (SOCAR) in Central Asia have signed an agreement whereby Equinor will divest all its remaining assets in Azerbaijan to SOCAR.

Rosneft, the Russian oil and gas company and the largest refiner and former partner of international majors such as ExxonMobil and BP, reported a fall in profits but is still managing the Western sanctions storm better than pipeline natural gas company Gazprom and LNG project developer Novatek.

Rosneft said that in the nine months to the end of September 2023 revenues declined to 6,612 trillion roubles ($74.4 billion), down from last year 7,202 trillion roubles ($81.05Bln) during the same nine months.

Operating income dropped to 1,778 trillion roubles ($20.10 billion) from 2,014 trillion ($22.65Bln) in the same nine months of 2022.

BP had previously held a 20 percent shareholding in Rosneft but pulled out immediately following the Russian invasion of Ukraine in February 2022.

Sakhalin projects

ExxonMobil also ended its decades-long involvement in Russia, exiting major oil and gas joint ventures with Rosneft off Sakhalin Island in the Russian Far East.

Rosneft said its production of liquid hydrocarbons increased by 3.9 percent in the first nine months of 2023 to 4 million barrels per day, mainly due to resumption of production at the Sakhalin-1 oil project.

Total production of all hydrocarbons rose by 10.7 percent in the nine months to 5.5M barrels per day of oil equivalent, whereas output of hydrocarbons in the third quarter had amounted to 5.4 million barrels per day of oil equivalent.

Production of liquid hydrocarbons in the third quarter equalled 3.9M barrels per day amid Russian oil production restrictions since March 2023 to offset the effects of sanctions.

Rosneft’s natural gas production increased by 33 percent in the nine months year-on-year to 1.5M barrels of oil equivalent per day.

Natural gas and associated gas are produced by 35 subsidiaries and joint ventures of Rosneft in Western and Eastern Siberia, Central Russia, Southern European Russia and the Far East.

Refining

Over the years, Rosneft has been consistently implementing a programme to modernise its refineries, which has enabled it to expand its product range and improve the quality of its products such as gasoline, diesel and jet fuel.

The company's refining unit operates 13 major refineries in the Russian Federation and total design capacity of the company's refineries in Russia is 118.4 million tons of oil per year.

Rosneft, which has a 40 percent share of the Russian refining market, said its oil refining throughput increased by 3.3 percent in the reporting period year-on-year to 65.8M tons, and rose 0.9 percent quarter-on-quarter to 21.7M tons.

Oct 30 (LNGJ) - Germany launched a two-pronged diplomatic blitzkrieg of West and East Africa with the Chancellor and the President simultaneously visiting each side of the continent and seeking the permanent replacement of Russian natural gas with LNG imports from Africa and with the Germans expressing a willingness to invest in energy projects. Visiting Nigeria German Chancellor Olaf Scholz said his country was willing to invest in natural gas in Nigeria, the largest LNG, gas and oil producer in sub-Saharan Africa. Before meeting Nigeria’s President Bola Tinubu the Chancellor had spoken of his nation requiring “considerable” amounts of natural gas.

   While Chancellor Scholz was in Nigeria and later travelling on to the West African nation of Ghana, German President Frank-Walter Steinmeier was visiting the East African country of Tanzania, an emerging LNG nation with a project being developed by energy majors. Chancellor Scholz also last year visited Senegal, where floating LNG projects are being development and spoke at the time of German investment in West Africa oil and gas.

Norway’s Equinor, an LNG supplier to the European Union and which has enabled some of the replacement of pipeline natural gas to Europe in the past year, has opened the Njord field in the Norwegian Sea.

Deutsche ReGas GmbH, a private company running the floating LNG import project at the German Baltic port of Lubmin to supply 4.5 million tonnes per annum of cargoes, has started a series of complex operations using a variety of vessels as part of its commissioning process.

The port of Lubmin in the German state of Mecklenburg-Vorpommern is best known as the landfall for the shutdown Nord Stream gas pipelines under the Baltic Sea from Russia.

Lubmin has been chosen by the German Federal Government as one of four coastal hubs for LNG floating storage and regasification (FSRU) imports because of existing German gas grid links.

Deutsche ReGas said that in the first phase of its project the natural gas would be fed into the German long-distance gas pipeline network (EUGAL/NEL), which is only 450 metres away.

The EUGAL gas pipeline was designed to be the onshore extension of the Nord Stream II project that was never started up.

The company also explained that to take account of the shallow depth of the water around the port of Lubmin, another tanker would be stationed outside the shallower approaches to which LNG carriers of up to 170,000 cubic metres would be able to dock and make LNG transfers.

The company explained that from the floating storage unit, three shuttle ships (small LNG carriers) would transport the LNG to the FSRU in the Lubmin industrial port.

Small carriers

The small-scale LNG carrier, the “Coral Furcata” with 10,000 cubic metres capacity arrived at Lubmin on December 30 with the first cargo to be used for commissioning purposes.

“The LNG was previously picked up by the ‘Hispania’, anchored off Rügen, and will now be handed over to the ‘Neptune’, which is in the port, as part of the permitted test operations of the LNG terminal,” explained Deutsche ReGas.

“The test operation is very extensive and complex,” stated the company.

“At sea, the procedures between the FSU anchored off Rügen island and the small-scale LNG carriers must be rehearsed,” it added.

“The manoeuvring of the SLNGCs in the port of Lubmin and the interaction with the tug crews must now also become a reality after previous training,” said Deutsche ReGas.

The company added that the interfaces between the FSRU and the shore connection as well as the FSRU and the shuttle ship must be further prepared and tested.

“During this phase on the ‘Neptune’, all of the processes and systems required for commissioning must be prepared. This is then followed by various operational tests, which usually end with a reliability and endurance test of the feed pumps,” the company said.

Deutsche ReGas said that as part of the test operations, the first quantities of LNG are being regasified and supplied to the German network operator Gascade GmbH.

“But we don't want to call this a feed-in, so as not to build up false expectations here,” the company emphasized.

Stephan Knabe, Chairman of the Supervisory Board of Deutsche ReGas, said he would like to state that the feed-in, i.e. commercial operation, only begins with the start of regular operations immediately after the successful completion of the test phase and after receipt of the operating permit.

European and Asian LNG cargo prices and natural gas pipeline values remained high even as the Nord Stream I pipeline re-opened on schedule after maintenance, restoring the main Russian gas connection to the European Union, though failing to alleviate long-term gas market supply concerns.

One of the companies involved in the German North Sea liquefied natural gas import project at Wilhelmshaven has announced an open season to fast-track LNG imports into Germany and the European Union.

German utility E.ON has formed a partnership with Belgian start-up Tree Energy Solutions (TES) to develop the North Sea facility and TES has announced the open season to gauge interest.

The Wilhelmshaven plan revolves around the construction of a new “green gas” terminal at the port which will initially accept shipments of mainly LNG to help reduce Germany’s reliance on Russian pipeline gas before a “green hydrogen” solution is safely developed by 2030 or later.

E.ON has signed a memorandum of understanding with Australian billionaire Andrew Forrest’s Fortescue Future Industries to import to Europe up to five million tonnes of “green hydrogen” from Australia or other locations by 2030.

Until then the North Sea facility will have to make do with LNG and TES has asked for LNG regasification capacities, shipment offers or other ideas in the consultation.

“The open season is accessible to all parties seeking to import LNG in the drive to reduce EU and Germany energy dependence on Russia,” said a statement.

Expressions of interest

“Parties are invited to submit an expression of interest to reserve capacity and services for the import of LNG volumes,” it added.

TES is planning for initial capacity to import up to 16-20 billion cubic metres per annum of natural gas from 2025 onwards.

The terminal will be connected through a pipeline to the European high-pressure gas grid.

“Terminal and pipeline capacity may be further expanded through the integration of further LNG tanks and commissioning of a second export pipeline,” it added.

“The expansion's timing and size will be determined by market demand for LNG imports from 2025 onwards, as well as the planned transition to green and clean, hydrogen-based gas,” it explained.

“To help decarbonise Germany and neighbouring markets, from 2027-2028 onwards, the Wilhelmshaven regasification terminal will, as part of the Wilhelmshaven Green Energy Hub, increasingly be reserved for imports of fossil-free green gas.,” it stated.

Six berths

According to the developers, the Wilhelmshaven terminal layout will ultimately comprise six ship berths, 1,600,000 cubic metres of onshore storage capacity using eight onsite tanks, of which four will be available during the initial stage.

The terminal also has plans to offer direct access to an extensive gas pipeline network, including existing salt caverns at Etzel and proximity to the Dutch Groningen gas grid infrastructure.

“The TES-Wilhelmshaven project is unique in accelerating Germany’s and Europe’s plans to decarbonise the energy market at scale whilst creating the opportunity to shift away from Russian gas imports as the way out of the current energy crisis,” said Otto Waterlander, Chief Commercial Officer at TES.

“The open season makes it possible to materially meet the needs of the market and will help provide energy security for Germany and the rest of Europe by accelerating the growth of green gas imports,” he added.