LNG

The World Bank predicts that LNG prices will recover strongly next year, even as an oil glut sends global commodity prices to a five-year low.

Analysts at the bank forecast that after falling in 2024, natural gas prices will recover in the US in 2025, and more modestly in Europe and Japan. 

Shipping lines A.P. Moller-Maersk and Hapag-Lloyd have reportedly placed orders totalling US$5.8 billion for LNG dual-fuel neo-panamax container ships from Yangzijiang Shipbuilding in China. 

Sources report that Hapag-Lloyd increased its initial order from 10 to as many as 18 vessels, each with a capacity of 17,000 TEUs. Meanwhile, Maersk has ordered 10 ships of similar size, with deliveries scheduled between 2027 and 2029, signalling a significant shift towards LNG fuel in the shipping industry.

Hapag-Lloyd and Maersk signed an agreement for a new long-term operational collaboration at the start of this year. The Gemini Cooperation is scheduled to start in February 2025, aiming to deliver ‘a flexible and interconnected ocean network’ with industry-leading reliability.

Energy and infrastructure firm Sahara Group has signed a Heads of Agreement (HOA) with Mexican company Amigo LNG SA de CV, for supply of LNG from Amigo LNG’s facility in Guaymas, Sonora, Mexico. 

The facility is a large-scale 7.8 MTPA liquefaction and export facility on Mexico’s west coast, owned by parent group LNG Alliance. Strategically located near shipping routes to the Asia-Pacific markets it has been developed in collaboration with the State of Sonora and the Port of Guaymas.

Offshore specialist PT. Layar Nusantara Gas (PTLNG) has signed a number of contracts to advance its floating liquefied natural gas (FLNG) project in West Papua, Indonesia. 

Agreements include a procurement contract with China National Machinery Import & Export Corporation (CMEC) and Shandong Kerui Energy Development, covering the design, engineering, and procurement of the project's onshore gas processing facilities and supporting infrastructure. The total contract is valued at approximately USD 183 million.

US firm New Fortress Energy announced the completion of its third LNG cargo loading from its Fast LNG unit, an offshore natural gas liquefaction facility. 

The operation marked the first full production for the facility, as the Fast LNG unit is producing at its nameplate capacity of 1.4 million tons per annum (MTPA). The cargo was loaded onto the BW Pavilion and is en route to Puerto Rico, where NFE has ongoing operations

Senior VP of FLNG Operations, Barry Clayton, expressed optimism about further production gains and emphasized the company's commitment to reliability and production consistency as they continue commissioning.

“We are excited that we have achieved full nameplate performance and believe there is room for further production gains as we continue to commission our facility,” Clayton noted. “Now that we have reached full production, our focus is on the continuous reliability and production of our installation.”

Headquartered in New York, NFE is an energy infrastructure company focused on affordable and clean energy solutions. Its LNG infrastructure, supported by a fleet of ships and logistics assets, contributes to global energy security and economic growth. 

Lithuanian terminal operator KN Energies has announced a €6 million investment to electrify the Klaipėda LNG terminal. 

The investment decision was reached during the Investment Committee meeting of the European Union’s Modernization Fund program and will see funds allocated to an ambitious transformation of the site. 

East Mediterranean LNG prices have softened relative to European levels, driven by weak demand and low shipping rates. Ample storage, mild temperatures, and cheaper pipeline gas have lessened the need for LNG imports, eroding East Med premiums.

October imports to the East Med reached 1.021 million metric tons, a slight increase from September but still lower than last year. High storage levels in Italy and Croatia, at roughly 98% and 91%, have further curtailed demand. Additionally, lower pipeline gas costs make LNG less attractive, leading to discounts on cargoes bound for the region.

Despite current pressures, some traders anticipate a rebound in Q4 2024 and Q1 2025 if weather shifts or supply disruptions arise. Factors like Egypt's shift to net imports, North African supply challenges, and potential UA transit issues could tighten supply, pushing up prices during peak winter demand.

Russian oil and gas producer Novatek reportedly has no plans to restart production of its Arctic LNG 2 project until summer having been forced into been into a shutdown earlier this month. This comes as sanctions and limited buyer interest stall the ambitious initiative on the Gydan Peninsula, which was intended to propel Russia’s LNG market share to 20% by 2030. 

The US Federal Energy Regulatory Commission has granted a three-year extension to Exxon Mobil and Qatar Energy to complete the Golden Pass (GPX) LNG plant in Texas. 

The joint venture project has been delayed following the bankruptcy of lead construction contractor Zachry Holdings in March. At the time, Zachry claimed the project was approximately US$2.4 billion over budget, suggesting the joint venture partners may face challenges in finding a new EPC contractor.

The GPX plant was originally expected to startup in the next 12 months and was projected to have annual capacity of around 18 million tons of LNG. It represents a strategic shift for the US LNG landscape, transforming what was once an import terminal in Sabine Pass, Texas, into a major export hub aimed at capturing growing global demand for natural gas. 

Exxon Mobil and Qatar Energy are reportedly in negotiations with McDermott International to take on the role of lead contractor on the project.

Shipping firm Pacific International Lines (PIL) has completed the first LNG bunkering of its new dual-fuel container vessel, the Kota Eagle, at at Yangshan port in Shanghai.

The bunkering operation was carried out in collaboration with Shanghai SIPG Energy Service (SSES) and involved transfer of approximately 8,000 cubic meters of LNG from the bunkering vessel Hai Gang Wei Lai.