LNG

The Asia-Pacific region is expected to have gradually increasing liquefied natural gas demand, driven by the region's economic recovery and new regasification facilities coming online.

Asian LNG imports generally declined in the first half of 2022 with rising gas prices curbing demand in the Japanese and South Korean electricity sectors, while a combination of high spot prices and ongoing Covid-19 lockdowns reduced gas consumption in China.

Japanese energy group JERA Co Inc., one of the world's biggest importers of liquefied natural gas, has signed an accord with the main electricity grid operator of Thailand to cooperate on LNG and the energy transition.

Thailand’s state-owned energy company said the Yadana natural gas project in neighbouring Myanmar was key to the energy security of both Southeast Asian nations and the Thais will take over the operatorship after the withdrawal of France’s TotalEnergies over human rights issues.

PetroVietnam Gas said it was making progress with plans to raise investments for infrastructure for importing, storing and distributing liquefied natural gas nationwide and the start-up of LNG imports is just a year away .

A board meeting of PV Gas said that each region of the southeast Asian nation would have one of three proposed LNG hubs.

These are the Thi Vai LNG storage and regasification terminal in the South, the Son My LNG storage and regas facility in the central region and a large storage and regas hub icovering Quang Ninh, Hai Phong and Thanh Hoa in the North.

PV Gas said the aim was to begin importing LNG cargoes by 2022 as the company explained that its own domestic natural gas production has declined.

The state-owned energy firm said that currently, there was a focus on the construction of an import terminal and storage with a capacity of one million tonnes of LNG per annum in Thi Vai. PV Gas said the Thi Vai LNG project is about 90 percent complete.

“It is expected to be put into operation in the third quarter of 2022 and other infrastucture, including an LNG jetty for tankers in Thi Vai, are also being worked on,” said PV Gas in a statement.

The company said it was focusing on preparing short and medium-term LNG import agreements.

US agreement

PV GAS and US-based AES Corp, have a joint venture agreement on the establishment and operation of the central region’s Son My LNG port and storage hub.

PetroVietnam signed an agreement with AES in September 2021 to form a joint venture for a $1.3Bln LNG terminal linked to a power project at Son My, located in Binh Thuan province.

AES, based in Arlington, Virginia, is an experienced LNG industry participant, having set up Caribbean LNG imports for the Dominican Republic way back in 2003 with the facility at Punta Caucedo operated by its subsidiary AES Andres.

AES was also behind the debut of Panama as an LNG importer with its Costa Norte project in operation since 2018.

Vietnam is developing up to six LNG import projects backed by power plant developments along its coast from the northern port of Haiphong to the ports in the South.

PV Gas, whose headquarters are in Ho Chi Minh City, became one of several Vietnamese businesses with a market capitalisation approaching US$10 billion as the stock price has risen by 48 percent since the beginning of 2021.

It hit a record at 125,000 Vietnamese dong per share in October.

However, the shares have since dropped to 118,900 dong per share, giving the company a current market capitalization of 22,605 trillion dong (US$8.72Bln).

In the last quarter, PV Gas posted consolidated profits after tax of 2.46 trillion dong ($95.3 million).

There are two official stock exchanges in Vietnam, one called the Ho Chi Minh Stock Exchange (HOSE) and the second is the Hanoi Stock Exchange (HNX).

Securities of unlisted public companies may be registered to be traded on the regulated over-the-counter (OTC) market on the Hanoi Stock Exchange.

The number of listings on each exchange is about 380 as of the start of 2021.

The Government has already approved a plan to set up the Vietnam Stock Exchange (VSE) based on the consolidation of the HOSE and the HNX.

The VSE will be a 100 percent state-owned limited liability company.

PetroVietnam has signed an agreement with US company AES Corp to form a joint venture for a $1.3 billion liquefied natural gas import terminal linked to a power project at Son My in Binh Thuan province of Vietnam.

PetroVietnam’s natural gas subsidiary, PetroVietnam Gas, said the terminal would import around 3.6 million tonnes per annum of LNG cargoes to the Asian nation by 2025.

“The signing took place in New York City and was one of the main activities on the sidelines on the occasion of President Nguyen Xuan Phuc's participation in the joint discussions session of the 76th United Nations General Assembly,” said a statement from PetroVietnam.

The AES-PetroVietnam LNG signing ceremony was attended by Vietnamese state leaders, including the President himself, who made a speech, as well as Nguyen Chi Dung, Minister of Planning and Investment, Nguyen Hong Dien, Minister of Industry, and Trade and Nguyen Thanh Nghi, Minister of Construction.

The AES LNG-for-power project in Vietnam was first discussed at the Indo-Pacific Business Forum in October 2020, attended by the then US Secretary of State Mike Pompeo.

AES, based in Arlington, Virginia, is an experienced LNG industry participant, having set up LNG imports for the Dominican Republic way back in 2003 with the import facility at Punta Caucedo operated by its subsidiary AES Andres.

AES was also behind the debut of Panama as an LNG importer with its Costa Norte project in operation since 2018.

Vietnam is developing up to six LNG import projects backed by power plant developments along its coast from the northern port of Haiphong to the ports in the South.

The President said in his speech that this was a project that had received the attention of the two states of Vietnam and the United States, leading to the establishment of the joint venture, Son My LNG.

“I hope that the construction of the Son My LNG Terminal will contribute to ensuring the supply of LNG for our power generation needs in key economic regions,” he stated.

PetroVietnam executives also attended, including Chairman Hoang Quoc Vuong and Duong Manh Son, General Director of PetroVietnam Gas.

On the AES side were Bernerd Da Santos, Executive Vice President and Chief Operating Officer, David Stone, President of AES Vietnam, Joe Uddo, Vice President of AES Market Development and Gaelle Burkhart, AES Global Cooperation Director.

Speaking for AES, COO Da Santos expressed his sincere appreciation of his company’s relationship with PetroVietnam.

“We thank the Government and all the ministries and especially the attention and direction given to the project by President Nguyen Xuan Phuc and his attendance at this event,” said Da Santos

“The signatories of the Agreement promise to be determined in developing the joint venture so that the Son My LNG can start operating as a development company in November 2021,” added Da Santos.

New Fortress Energy Inc., the US operator and developer of liquefied natural gas projects in the Americas, has signed a framework agreement with the Government of Sri Lanka to construct an LNG receiving, storage and regasification terminal offshore the capital of Colombo and with start-up scheduled for the second half of 2022.

Stena Power and LNG Solutions was awarded the contract by Singapore-based Delta Offshore Energy to provide front-end engineering and design for using Stena’s jetty-less LNG transfer and regasification system for an import and power project planned for Bac Lieu province in Vietnam’s Mekong Delta.

Delta Offshore proposes to employ Stena’s Jetty-less Floating Terminal (JFT) and Self-Installing Regas Platform (SRP) to assist in providing 3,200 megawatts of gas-fired power from LNG imports into the Bac Lieu province of southern Vietnam.

A technology license agreement had previously reached between Stena Power & LNG in August 2020 for Delta Offshore to use the proprietary jetty-less technology.

“The FEED agreement is pivotal in our service provision to Delta Offshore for this important, large-scale energy infrastructure project in Vietnam,” said Svein Hellesmark, Chief Technology Officer of the Norway-based subsidiary of the Gothenburg, Sweden-headquartered Stena Group.

“Our Jetty-less LNG-to-Power technology has been created to meet demand for more flexible LNG import and export terminals, such as is required for the hugely exciting Bac Lieu LNG-to-Power Project,” added Hellesmark.

“At Stena we offer innovative, integrated solutions across the LNG value chain. Our wide-ranging activity in the sector also includes new-building project support, ship management and marine engineering, all underpinned by our ethos that gas should always travel first class,” he stated.

The Stena units, the Jetty-less Floating Terminal (JFT) and Self-installing Regas Platform (SRP), will be located about 40 kilometres (25 miles) off the Vietnam coast.

Stena said that the FEED contract would include detailed model testing to ensure optimum performance with the environmental conditions in the Mekong Delta.

Bobby Quintos, Managing Director of Delta Offshore, said he now regarded the Stena equipment as “key components” his company’s LNG-to-power project in Bac Lieu.

“They allow us to position the LNG receiving terminal offshore, and thereby to minimize the project’s impact on land and on the coastline of Bac Lieu,” explained Quintos.

“This is a benefit of great value to the province because the coast sustains shrimp farms, mangroves and salt beds, all of which are important to the regional economy and environment,” he added.

“Our ethos at Delta is to provide power for progress, and the JFT and SRP will help us do so in an efficient and economical manner,” declared Quintos.

Italian energy company Eni has strengthened its presence in future LNG importer Vietnam through the acquisition of Block 115, located in the Song Hong basin and the nearby Ken Bau natural gas and condensate discovery.

Eni acquired a 100 percent interest in the Block from Krisenergy, an independent upstream company focused on the production and development of oil and gas in the basins of Southeast Asia.

“The acquired Block is adjacent to Block 114 where the operator Eni Vietnam and its partner Essar Exploration and Production Limited have recently announced the Ken Bau gas and condensate discovery currently under appraisal,” explained Eni.

Milan-based Eni said the new acreage also borders Block 116, operated by Eni Vietnam with a 100 percent participating interest.

The Block covers an area of 7,382 square kilometres with a water depth ranging from 90 metres to 1,000 metres.

“Eni's presence in the country is further strengthened with this acquisition, consolidating its position in the recently discovered Ken Bau play, in line with the strategy of expanding  its gas portfolio in the Far East,” said Eni.

Eni has been present in Vietnam since 2013, and currently operates five blocks all located in the under-explored Song Hong and Phu Khanh basins.

Vietnam is currently developing about half-a-dozen LNG and power projects with overseas partners to try and keep pace with future energy needs to enable its economic expansion.

The leading LNG import projects include the Quang Ninh LNG-for-power venture owned by a partnership comprising PetroVietnam, Tokyo Gas and Marubeni Corp.

Vietnam is also developing another terminal involving US major ExxonMobil Corp. at the port city of Haiphong.

Another Vietnamese LNG-for-power venture is being developed by Singapore-based company Delta Offshore Energy and partners in Bac Lieu province in the Mekong Delta of south Vietnam.

Other ventures are planned for Ninh Thuan province, south of Cam Ranh Bay, and at Long An, also on the Mekong Delta. 

First Gen Corp. of the Philippines has chosen BW LNG of Singapore to provide a floating storage regasification unit (FSRU) for its LNG import terminal project at Batangas in Luzon.