LNG

Starting in 2026, Oman LNG will partner with Vitol Asia under a newly signed agreement covering the optimization of up to 0.8 million metric tonnes per annum (mtpa) of LNG on a delivered ex-ship (DES) basis. The cooperation enhances Oman LNG’s flexibility from DES commitments and allows it to better align with buyers demand for more adaptable contracts.

Swiss-based Vitol – a trusted partner of Oman LNG and a key portfolio trader – is meant to help Oman LNG unlock new value by helping the state-run Middle Eastern LNG exporter to enhance its portfolio’s flexibility and responsiveness to shift in a global gas market, said Mahmoud al Baloushi, Chief Commercial Officer of Oman LNG.

The cooperation agreement was signed in Muscat in the presence of Oman’s energy minister Salim bin Nasser al Aufi.

“This agreement with Vitol highlights our agility and ability to adapt to changing market conditions,” said Hamed al Naamany, CEO of Oman LNG. He pointed out there was a “continued positive market response to Oman’s gas and LNG strategy.”

Prioritising RES to sell more LNG abroad

Oman’s domestic energy mix has been shifting towards renewables as the government seeks to free up more volumes of natural gas for liquefaction and sale abroad.

As a consequence, Oman Electricity Transmission Company (OETC) is prioritising dispatch of renewables and other clean power sources over conventional gas-based output. Operational are currently a 50 MW wind farm in Dhofar and 500 MW solar PV capacity at Ibri, but over the next six years some 1.5 GW of solar projects along with 1 GW of wind capacity are slated for development.

Lowering the reliance on gas-fired power, frees up fuel for export: Oman LNG in April last year signed a sales and purchase agreement (SPA) with BOTAS of Turkey to supply 1 mtpa of LNG to Botas over a 10-year period, starting from mid-2025.

French major TotalEnergies reported a decline in second-quarter earnings led by the company’s liquefied natural gas and the refining and chemicals divisions, while exploration and production performed well.

WINGAS GmbH, a former subsidiary in Germany of Russia’s Gazprom, has now been rebranded as a part of the SEFE Energy group, which is a business active in LNG import terminals, trading and portfolio management, transportation and storage of energy and is fully owned by the Federal Government of Germany.

The SEFE name comes Securing Energy for Europe (SEFE) GmbH, previously called Gazprom Germania and which came under German control and had its name changed after the Russian invasion of Ukraine in 2022 and subsequent sanctions and the shutting off of the Nord Stream gas pipelines from Russia to Germany.

The SEFE company also controls Germany’s largest gas storage facility and has capacity through the utility Uniper at the North Sea port of Wilhelmshaven and at Brunsbüttel on the Elbe River.

SEFE also has a stake in Germany’s proposed fifth LNG import terminal at the port of Stade, also located on the Elbe between Hamburg and Cuxhaven.

The German Government acquired all the shares in SEFE in November 2022 and thus became the sole owner of the group of Gazprom companies in Germany.

LNG supply deals

US LNG exporter Venture Global LNG and SEFE have signed a long-term Sales and Purchase Agreement.

Under the agreement, SEFE’s subsidiary, WINGAS GmbH, will purchase 2.25 million tonnes per annum of LNG from Venture Global’s CP2 project to be located next to the existing Calcasieu Pass plant.

SEFE has additionally signed an accord to receive future volumes from Oman.

“This rebranding marks a significant milestone for SEFE, as it brings all of the group’s sales businesses together under one identity across Europe,” said SEFE.

Over the past 30 years, WINGAS has established itself as one of the leading natural gas suppliers in Europe.

Based in the German city of Kassel and with a strong presence across Germany, the company supplies energy-intensive customers across Europe, including municipal utilities, regional gas suppliers, industrial companies and power plants.

In addition to WINGAS’s existing sales business, SEFE Energy also provides gas, electricity, and low carbon energy products to customers in the UK, France, and the Netherlands.

As an integrated sales organisation, SEFE Energy now supplies over 50,000 customers in seven European countries, with a sales volume of around 200 terawatt hours of gas and electricity.

“By leveraging the synergies of our sales teams across Europe, our customers benefit from a more comprehensive offering of energy products and services, helping them achieve their strategic energy goals,” said Matthias Peter, Managing Director of SEFE Energy.

A wholly owned subsidiary of US energy engineers McDermott has been awarded a significant contract by the Marsa liquefied natural gas project in the Sultanate of Oman on the Arabian Peninsula for storage and associated piping.

McDermott, based in Houston, Texas, has confirmed that its subsidiary CB&I will build a full containment concrete LNG storage tank at the Marsa project site at Oman's Port of Sohar.

French major TotalEnergies is going ahead with a large investment in the Marsa LNG project to serve as the first LNG bunkering hub in the Middle East.

The joint venture between TotalEnergies and Oman National Oil Company will build a liquefaction plant with 1 million tonnes per annum of output.

Feed-gas will come from Oman’s Mabrouk North-East field in the onshore Block 10 area.

Contractors

The main engineering, procurement and construction contracts have been awarded to France’s Technip Energies for the LNG plant and to CB&I for the 165,000 cubic metres capacity LNG storage tank.

The LNG is primarily intended to serve the marine fuel market in the Arabian Gulf region while LNG quantities not sold as bunker fuel will be off-taken by TotalEnergies and the Omani partner.

In addition to the storage tanks contract, CB&I will provide turnkey EPC services for the tank and associated piping.

Project delivery will be executed in Oman, where CB&I has been continually present since 1968, with support from CB&I's Dubai office.

“Through this project, CB&I will contribute to the construction of one of the lowest GHG emissions intensity LNG plants ever built,” said Cesar Canals, President and Chief Executive of CB&I.

“It supports our ambition to build storage for projects that will help provide reliable energy to markets,” Canals explained.

“It will also pave the way for similar storage opportunities in the future and continues our long history of execution excellence in the Middle East, specifically Oman,” he added.

Work is expected to commence with construction activities in the fourth quarter of 2024.

The overall Marsa bunkering fuel projects is targeted for completion in 2028.

Japanese liquefied natural gas imports dropped by 10.5 percent amid milder winter weather and prices at almost 30 percent lower levels while thermal coal imports were steady and plans were revealed for another nuclear restart.

TotalEnergies reported declines in annual and quarterly net profits as commodity prices plummeted compared with the previous year while the French major sold over 44 million tonnes of liquefied natural gas and opened the Le Havre floating LNG regasification terminal in France while being further boosted by progress in other oil and gas projects.

Shell reported a drop in fourth-quarter and annual profits as oil and gas prices declined from last year while the UK major’s LNG sales increased to over 67 million tonnes for the year.

European and Asian liquefied natural gas prices fell over the past week with the Dutch Title Transfer Facility benchmark declining by over 7 percent as European Union storage levels hit 100 percent and energy security concerns waned with cargo deliveries gathering pace and seasonal temperatures prevailed.

UK major Shell reported much reduced third-quarter profits of $6.2 billion, lower than the $9.45Bln of profits returned in the same three months of 2022 as natural gas prices dropped, while quarterly sales of liquefied natural gas were still over 16 million tonnes.

UK major Shell said its subsidiary Shell Gas BV has signed an amended joint venture shareholder agreement in the Sultanate of Oman in the Arabian Peninsula for Oman LNG to extend the business beyond 2024.