LNG

Hanwha Ocean, the South Korean shipbuilding company formerly known as Daewoo Shipbuilding & Marine Engineering, is said to be considering a move into the offshore platforms and drilling sector while continuing to increase its LNG carrier newbuild backlog.

Korean regulatory information shows that Hanwha Ocean has registered two new trademarks, suggesting expansion into the maritime energy drilling sector as the nation’s companies seek more profitability.

The registrations concern “Hanwha Drilling” and “Hanwha shipping”, though the Group has yet to disclose its intentions.

Hanwha Ocean, formerly DSME, was acquired by the Korean conglomerate, the Hanwha Group, in 2022 and was rebranded as Hanwha Ocean in May 2023.

Two Japanese companies have just filed an order for an LNG carrier to be built at Hanwha Ocean’s Geoje Shipyard in South Korea.

Tokyo Gas, the utility company and LNG importer, said its Tokyo LNG Tanker Company concluded a long-term charter contract with Mitsui OSK Lines (MOL) for this newbuild vessel ordered by MOL.  

MOL LNG fleet

MOL has a growing energy shipping business with a fleet including over 150 tankers for oil and other products and about 90 LNG carriers.

Tokyo Gas said that the charter agreement meant that the company had 11 LNG carriers fixed under a long-term charter.

The utility said that the MOL-owned newbuild would have 174,000 cubic metres capacity and be delivered in 2026.

The carrier will have a service speed of 1.5 knots and would be 295 metres in length and a beam of 46.4M.

“The Hanwha Ocean-built vessel will be equipped with the state-of-the-art MAN Energy Solutions engine (ME-GA) with improved fuel consumption efficiency and is expected to significantly reduce greenhouse-gas emissions compared to conventional LNG carriers,” said the utility.

“From 2026, the vessel will be utilised for TG Group’s LNG procurement and LNG trading,” it added.

“With this charter contract, the TG Group will continue to promote stable energy procurement while giving further consideration to the environment amid the changing surroundings of the global LNG market,” it added.

Tokyo Gas, one of the largest and longest-standing liquefied natural gas importers, has formed a joint stock company to proceed with an LNG import and power project in Vietnam at Thai Binh in the north.

McDermott, the US engineering and construction company, and energy and LNG technology company Baker Hughes, have completed the installation of subsea infrastructure at the Ichthys gas field in northern Australia linked to the liquefaction plant operated by Japan’s Inpex Corp.

The contract was awarded to a McDermott and Baker Hughes consortium in 2019 by Inpex, the operator of the Ichthys project at Badin Point near Darwin in Australia’s Northern Territory.

Ichthys LNG has as additional shareholders French major TotalEnergies and the Australian subsidiaries of CPC Corp. of Taiwan, and Japanese utilities an importers Tokyo Gas, Osaka Gas, Kansai Electric Power, JERA and Toho Gas.

Key LNG producer

Ichthys LNG has nameplate capacity of 9.3 million tonnes per annum LNG and 1.65 million tonnes of liquefied petroleum gas per annum along with more than 100,000 barrels of condensate per day at peak output.

The McDermott-Baker Hughes subsea infrastructure development project included engineering, procurement, construction and installation (EPCI) of umbilicals, risers and flowlines (URF), a subsea production system comprised of a new 7-inch (approximately 18 centimetres) vertical Ichthys LNG planthristmas tree (VXT) system.

McDermotts said this is all part of forming a subsea well gathering system (GS4) tied back to the existing the “Ichthys Explorer “central processing facility.

The consortium’s scope of work also included an in-fill URF EPCI involving the development of new subsea wells tied-in to the existing gathering systems.

“The McDermott and Baker Hughes partnership has been marked by resilience and adaptability, guided by our firm commitment to deliver for the INPEX-operated Ichthys LNG and Australia,” said Mahesh Swaminathan, McDermott’s Senior Vice President, Subsea and Floating Facilities.

Engineering capabilities

“Together, leveraging McDermott’s unique end-to-end EPCI capabilities and Baker Hughes’s subsea development solutions, we navigated project complexities and overcame the unique challenges posed by the pandemic,” Swaminathan explained.

“Our hard work paid off, and I would like to thank our teams in Perth (Australia), Batam (Indonesia), and beyond, whose collective efforts enabled the safe completion of this important work scope,” Swaminathan added.

Romain Chambault, Baker Hughes Senior Vice President, Subsea Projects and Services, said the completion was achieved through the successful partnership between Baker Hughes and McDermott to execute the project for Inpex.

“The amount of collaboration shown between the consortium has been truly unique and serves as an industry benchmark for the successful execution of large, complex EPCI subsea projects,” Chambault stated.

Australia’s largest liquefied natural gas companies Woodside Energy and Santos said they were in discussions that could lead to a merger of the two companies valued at a combined A$88 billion (US$58Bln) and which would create a dominant LNG force in the Asia-Pacific region.

Chevron Corp., the operator of the Gorgon LNG and Wheatstone LNG plants in Western Australia hit by industrial disruption, said it would apply to Australia’s labour regulator to help resolve its dispute with unions currently causing partial strikes.

Japanese liquefied natural gas imports dropped almost 19 percent in April even as cargo numbers remained stable from Australia but declined from other regions as milder weather and higher energy storage curbed demand for LNG cargoes as well as thermal coal.

Japan, which formally took back the World No. 1 LNG importer spot from China in 2022, reported a small rise in LNG shipments in January though at a much higher cost than in the prior-year period.

Imports for January amounted to 6.82 million tonnes, or about 100 cargoes, and an increase of 0.5 percent from the 6.78MT received in January 2022, according to Japan's Finance Ministry.

The imports cost 873.8 billion yen ($6.54Bln), which was 57 percent more than the 556.6Bln ($4.16Bln) cost of shipments in January 2022.

While China’s LNG imports dropped by 18.8 percent to 64.15MT, the official Japanese LNG import volumes for 2022 came to 71.99MT compared with 74.31MT in 2021, showing a fall of 3.1 percent but still enough to essily maintain the lead over China.

China had overtaken Japan in 2021 to become the world’s largest LNG importer with 78.93MT of imports, though then slipped back because of the economic slowdown and Covid-19 restrictions affecting energy demand.

Japan’s annual LNG costs jumped by 97.5 percent to 8.55 trillion yen ($64.34Bln) in 2022.

Monthly LNG imports for December 2022 to Japan’s network of 37 terminals had fallen by 13.8 percent to 6.06MT from 7.03MT in the same month of 2021.

Coal imports

Japan continued to use an increased proportion of thermal coal for electricity generation and the January coal imports rose by 1.3 percent from January 2022 to 10.68MT.

LNG cargo deliveries from Asian countries like Malaysia and Indonesia increased in January by 17.8 percent to 1.88MT.

Middle East cargo imports rose by 24.1 percent to 787,000 tonnes during the month.

LNG imports from the US tumbled by 73.9 percent year-on-year to 90,000 tonnes as cargoes from American export plants were pointed at Europe.

Imports from Russia declined on the month by 9.7 percent to 704,000 tonnes and cost 78.6Bln yen ($589M) for what amounted to 11 cargoes.

The cost to Japan of Russian deliveries for all of 2022 was 82.4 percent higher than in the previous year with the bill from the Russians coming to 677.5Bln yen ($5.24Bln).

Japan continues its deliveries of LNG from the Russian Far East plant at Sakhalin Island even after the invasion of Ukraine in February 2022 as energy security outweighed the Western-led imposition of sanctions against Russia on the energy and financial fronts.

The balance of Japan's LNG imports in January amounted to 3.86MT in the form of deliveries from the country’s largest supplier Australia, some spot cargoes and small volumes from Africa.

In its energy mix in 2022, Japan has continued to delay more nuclear power re-starts meaning that volumes of LNG and coal purchases remain high.

Since the Fukushima disaster, only 10 reactors have been given the go-ahead to go back into operation compared with the 54 that were online in 2011 and which supplied around 30 percent of Japan’s energy needs.

A further 21 reactors have been decommissioned since 2011 and will never be re-started.

Feb 1 (LNGJ) - Tokyo Gas, the utility and LNG importer, reported a more than 72 percent increase in nine-month revenues from natural gas sales totalling 1.55 trillion yen ($11.9Bln) compared with 907.84 billion yen ($6.9Bln) in the same period of the previous year.

   The utility said nine-month operating profit rose more than four-fold to 235.7Bln yen ($1.8Bln) versus 52.3Bln yen ($409M) in the prior-year period. Natural gas accounts for 60 percent of the business with other income coming from electricity sales as well as other energy and overseas activities.

Woodside Energy, operator of the North West Shelf and Pluto LNG export plants in Western Australia, said the shareholders in the projects have agreed to process feed gas from the Equus gas field in the Carnarvon Basin.

Alaska Governor Mike Dunleavy has just concluded a trade mission to Japan where he met executives of leading energy companies and utilities as well as government ministries to discuss Japanese companies procuring long-term Alaskan LNG supplies.