LNG

A total of 16 new LNGCs being built in Japan for domestic owners are to be powered by Wärtsilä dual-fuel engines. 

Dynagas LNG Partners has reported an adjusted net income of $15 mill and $60.9 mill for the fourth quarter and 12 months of 2015, respectively. 

Blind-sighted by the US shale gas revolution, a flurry of developers have been seeking to export LNG from the lower 48 states even though much of this capacity is not needed. On the flip-side, idled US regas facilities look like ‘sunk costs – but not quite: Cheniere Energy still gets paid for contracted regas slots, even if customers do not actually use it. 

This year, 2016, should see the much-awaited Final Investment Decision (FID) on the Shell-led LNG Canada project. It’s tipped as the front-runner after NorthWest LNG is beset by quarrels over fishing rights and financing woes. 

Several US firms have submitted proposals in a USTDA tender for a Feasibility Study to assess and plan the development of LNG-related projects in Panama. The tender closed on January 29. 

Oblivious, and seemingly unfazed by the forthcoming glut in global LNG supply, an array of new liquefaction and export projects have been speedily sanctioned by US regulators the first half of the past year, in what Wood Mackenzie calls a “blistering pace”. Faced with demand destruction and a plunge in the price of contracted LNG in line with oil, US project developers started to court buyers in emerging markets as they sniff out opportunities in the Middle East/Africa [and northwest Europe.]  

Societe Generale recommends to go ‘long’ on the Mar-17 US natural gas contact, anticipating a March 2017 price to rally next year as the market becomes much less oversupplied. Bank analysts see scope for the price to eventually reach $3.50.

US spot gas prices at Henry Hub are forecast to rise through much of 2016, spurred by rising industrial consumption and moderate supply growth due to falling rig counts. Starting into 2016 near $2/MMBtu, Henry Hub spot prices will rebound to $2.65/MWh, according to EIA estimates. 

Liquefaction is energy-intensive; hence the construction of such a facility tends to significantly increase the power load already being served in an area. An array of LNG export projects have been proposed along the ERCOT Gulf Coast, notably Freeport LNG and Cheniere’s Corpus Christi project – both due to export first cargoes in 2018. As the regional power grid operator, ERCOT is wary about project partners eyeing expansions and another six LNG projects seek grid connection in the Brownsville area. 

Steward, a sleepy former gold and silver mining town on Canada’s northern Pacific Coast, might be revived by a liquefaction project after regulators granted an export licence to a firm, backed by Chinese investors. The National Energy Board (NEB) authorized Canada Stewart Energy Group to ship 25 Tcf of natural gas over 25 years in tanker cargoes to be loaded at a rate of up to 4.6 Bcf/d.