LNG

Towards the end of last year, ABS published a concept study on an LNGC design fitted with a nuclear propulsion plant. Technical Editor Ian Cochran investigates.

Plans to dramatically increase US exports may provide a boost for LNG fuelling hubs in the country as the industry prepares to ramp up investment.  Fuelling Editor Malcolm Ramsay has more.

ADNOC: Japan’s major energy buyer, JERA Global Markets and the UAE’s main energy supplier, ADNOC Gas have signed a $450 mill (AED1.653 bill) LNG supply agreement. 

Under the terms of the agreement, LNG will be supplied by ADNOC Gas to JERA Global Markets’ global supply portfolio for three years.

The European Union may need up to 350 extra LNG cargoes this year, Helge Haugane, Equinor’s head of gas and power trading, told Bloomberg News yesterday.

In a worst-case scenario, European gas reserves could be only 30% full by the end of this winter, Haugane said, adding that attracting cargoes will be critical to refilling storage over the summer, which could be costly and require regulatory intervention.

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The Greater Tortue Ahmeyim LNG project partners initiated LNG production at the bp-operated venture off Mauritania and Senegal's coast. The Phase I development, processing 500 million cubic feet of gas daily, marks a significant achievement for West African energy production, with an expected annual output of 2.3 million tonnes of LNG over two decades.

While the halting of Russian piped gas transits via Ukraine does not pose an imminent supply risk for the European Union, it could add to near-term LNG market pressure, according to Paris - based International Energy Agency’s (IEA) latest quarterly gas market report. 

The report said that the markets moved towards a gradual re-balancing last year after the supply shock that followed Russia’s invasion of Ukraine in February, 2022.

LNG freight rates fell to historic lows in the week ended 23rd January, in both the Atlantic and Pacific basins, as ship numbers built up, due to the limited availability of cargo.

Last week, tri-fuel diesel electric (TFDE) LNGC rates fell much faster than their 2-stroke equivalents, as charterers had no need to opt for TFDEs, with 2-strokes being so cheap.

"I doubt anyone would pay $8,000 per day for a TFDE if you can get a 2-stroke for $9,000-$10,000 per day," a shipbroker said, talking with S&P Global.

Platts, part of S&P Global Commodity Insights, assessed the Atlantic TFDE day rate at $6,500 last Thursday, down $9,500 on the week, an all-time low, with a ballast bonus of 80%.

Asia/Pacific TFDE day rates were assessed at $8,000, with a ballast bonus of 100%, dropping $4,500 per day over the week.

However, 2-stroke LNGC rates also fell last week, due to the severe oversupply of tonnage and the very little uncontracted cargoes available.

Platts assessed Atlantic 2-stroke LNGC day rates at $10,000 last week, with a ballast bonus of 80%. This was a drop of $15,000 per day on the week, while Asia/Pacific 2-stroke day rates were at $15,000 with a ballast bonus of 100%, down $7,000 per day over the week.

"Rates will be like this for a week or two I think... with 2-strokes below $20,000s per day TFDEs are basically out of the market," a shipbroker added.

"Too many newbuilds entered the market... And there's no arbitrage, no contango, and no real demand from China/Japan," another shipbroker said, when asked about the main reasons for the oversupply of available carriers and the lack of cargoes.

Little demand in the East further exacerbated the oversupply problem and contributed to the falling rates and struggling market in general.

This could lead to an increase in LNGC layups and recyclings, sources said.

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