LNG

Singapore LNG spot cargo prices surged by 12 percent in the past week as trading picked up and North Asian shipments for the second half of November were quoted at US$6.000 per million British thermal units.

Singapore LNG spot cargo prices dropped by an average of 2.4 percent from last week for Southeast Asia and the Middle East and India, with only North Asian cargoes maintaining values over US$5.000 per million British thermal units for November amid continued over supply.

The Singapore average index for October declined to US$4.192 per MMBtu from last week’s October average of US$4.239 per MMBtu, a drop of 2.6 percent.

Singapore’s latest LNG indices released on August 29 included a price of US$4.070 per MMBtu for southeast Asia for the second half of September, edging up to US$4.090 per MMBtu for the first half of October.

Prices fell as the market remained oversupplied while North Sea Brent crude was still steady at around $61 per barrel.

Southeast Asia cargo prices for the second half of October moved higher to US$4.293 per MMBtu and were highest for the first half of November at US$4.880 per MMBtu.

The Sling is an index series for LNG developed by the Singapore Exchange and its subsidiary Energy Market Company.

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 Asian price fell by about 2.3 percent to an October average of US$4.425 per MMBtu.

North Asia cargoes for the second half of September were at an average of US$4.288 per MMBtu and were only slightly up for the first half of October at US$4.325 per MMBtu, before increasing again to US$4.525 for the second half of October.

The first half of November price for the North Asia market was down 1.4 percent compared with last week and was quoted at US$5.125 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 for regional cargoes shipped to India and the Middle East averaged US$4.219 per MMBtu for October, down 2.4 percent from last week.

The DKI index, based on a cargo of between 138,000 cubic metres capacity and 170,000 cubic metres, was at US$4.112 per MMBtu for the second half of September and was only slightly up at US$4.114 for the first half of October.

The second half of October DKI price gathered pace to US$4.324 per MMBtu and for the first half of November was short of US$5.00 per MMBtu at US$4.913.

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.

However, the Singapore Exchange and the EMC plan to cease publishing LNG prices soon.

The Singapore EMC explained that it would “endeavor to continue publishing the Sling for three months” after the end of July.

The SGX LNG Index Group (Sling) was launched in 2015 in response to expressions of need for a trusted price formation process for Asian LNG.

“However, usage of the Sling indices has remained low,” the SGX and EMC explained.

“Subscribers with linked financial contracts are advised to migrate such contracts to an alternative benchmark or to otherwise account for the Sling’s cessation,” they added.

Singapore LNG spot cargo prices fell, led by a decline in North Asia of around 3 percent on the week and in the Middle East and India as traders looked to September and beyond for higher values.

Singapore LNG spot cargo prices declined by around US$0.20 per million British thermal units, though managed to stay above the $4.00 per MMBtu level for southeast Asia with North Asia shipments slightly higher.

Keppel Corp. of Singapore completed its first liquefied natural gas import shipment from the US under the city-state’s import policy allowing wholesale gas customers to receive up to 10 percent of their annual long-term contracted LNG volumes on a spot cargo basis.

Keppel said the 160,000 cubic metres spot cargo reached the Jurong Island terminal on April 10 and would be regasified as feedstock for downstream customers and end-users during the next 30 days.

The company’s Keppel Gas natural gas supply customers include long-term pipeline and LNG contracts holders.

“Such recurring spot LNG import opportunities help to bolster Keppel’s supply portfolio, complementing its long-term pipeline gas import business,” said the company.

The General Manager of Keppel Infrastructure, Janice Bong, said the delivery was part of the company’s strategy of widening its presence in the gas value chain to deliver competitive gas supplies promptly.

“By tapping the opportunities offered by the spot LNG market, we are able to ride on global trends to support our integrated energy business over the long term,” she explained.

Keppel Gas is an importer, shipper and retailer of natural gas in Singapore's liberalized gas market.

The imported natural gas is supplied to a portfolio of major refineries, petrochemical companies, industrial companies and Keppel Merlimau Cogen, a 1,300 megawatt combined-cycle gas power station.

Singapore LNG Corp., operator of the import terminal, is also widening its activities and in February 2019 completed modifications to its secondary jetty on Jurong Island.

SLNG said its terminal can now handle small-scale vessels with capacities of between 2,000 cubic metres and 10,000 cubic metres and the ships were able to receive and reload shipments.

The modifications include the installation of a new marine loading arm and gangway, as well as new facilities for securing smaller ships at the jetty.

SLNG is additionally considering building a fifth storage tank after its fourth tank was put in service in 2018 and has an even larger capacity than the other three at 260,000 cubic metres, offering LNG traders more options and flexibility.

The SLNG facility’s three other storage tanks each have a capacity of 188,000 cubic metres and 540,000 cubic metres in total.

The terminal is owned by the Singapore Energy Authority and is located on a 40-hectare plot at the southern tip of Jurong Island.

It has been in operation since 2013 and can handle the largest LNG carriers from Qatar. 

The fifth tank will have storage of either 188,000 cubic metres or 260,000 cubic metres and SLNG has issued an expressions of interest notice to customers.

Preferred usage terms for the fifth tank are of at least 15 years starting by around 2022.

Singapore LNG cargo indices were at a high of $6.40 per million British thermal units for North Asia while May spot cargoes were quoted at around $6.00 per MMBtu as the oil price remained solid above $65 per barrel and underpinned hydrocarbon markets.

The Singapore average index for April was at US$5.983 per MMBtu, falling from last week’s average of US$6.136 per MMBtu.

Singapore’s latest LNG indices released on February 21 included a price of US$6.060 per MMBtu for the second half of March and was lower at US$5.985 per MMBtu for the first half of April.

Cargo prices for the second half of April were at US$5.980 and were slightly higher for the first half of May at US$6.059.

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 dropped to an April average of US$6.317 per MMBtu versus US$6.506 last week.

North Asia cargoes for the prompt second half of March were the highest available in the market at US$6.400 per MMBtu, before declining for the first half of April to US$6.325 per MMBtu, then down further to US$6.318 for the second half of April.

The first half of May quote for North Asia showed some recovery at US$6.350 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$6.068 per MMBtu for April, down from last week’s US$6.205 per MMBtu.

The DKI index, based on a cargo of between 138,000 cubic metres capacity and 170,000 cubic metres, is seen at a high in the second half of March of US$6.130 per MMBtu before dropping to US$6.060 per MMBtu for the first half of April and edging higher to US$6.075 for the second half of April.

The first half of May quote for Dubai-Kuwait-India was at a steady US$6.113 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 cargo indices were still in a weak range after the second half of February as seasonal declines set in and only North Asia shipments were quoted above the US$8.22 per million British thermal units level.

Singapore LNG cargo indices fell to their lowest level this winter to be below US$9.00 per million British thermal units except for some destinations in North Asia for February deliveries.

Singapore LNG cargo indices slipped for late December and early January as regional demand ebbed in Asia and prices dropped below US$11.000 per million British thermal units for the first time for Chinese winter season cargoes as February quotations also made an appearance.

Singapore LNG cargo indices dropped for deliveries through December and January in line with the oil market retreating in a month by more than $13 per barrel to under $73 per barrel.