Tag Archives: Liquefied Natural Gas

MELBOURNE, February 16 (Reuters) – Australia’s southern state needs to import natural gas to fill a looming shortfall by 2024, as falling oil and gas prices caused by COVID-19 last year have slowed investment in new fields, said the country’s competition watchdog. . Tuesday.

Regulators have warned of a potential gas shortage since 2016 as the market’s mainstay of gas sources off the south coast dries up, but the supply crisis is now approaching fast, said the Australian Competition and Consumers Commission (ACCC).

“It is worrying that the risk of a gas shortage in the southern state of Australia continues, although this has been a looming issue for some time,” said ACCC Chair Rod Sims in a statement.

The fall in oil and gas prices last year brought some relief to gas buyers but has slowed down investment in new gas projects, which have “increased the supply risks facing the gas market in the medium term,” said the ACCC.

Even if existing and probable proven gas reserves in the northern state of Queensland are developed, there could be a 30 petajoule (PJ) supply gap as early as 2024 in the southern states, the ACCC estimates.

“To ensure sufficient supply to meet demand, the southern states will need to increase the capacity of the north-south pipeline, develop additional onshore and offshore gas fields, or construct one or more LNG import terminals,” he said in his latest report. gas market renewal.

There are five proposed liquefied natural gas (LNG) import terminals, two in New South Wales, two in Victoria and one in South Australia. Only one of them, Port Kembla in New South Wales, has moved to site preparations so far.

If the Port Kembla terminal is built before 2024, it will close the supply gap in the southern states and east coast markets until 2028, the ACCC said.

Reporting by Sonali Paul; Edited by Christian Schmollinger

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Australia

Chevron said Australia’s Wheatstone LNG production was below capacity due to repairs | Instant News

February 1, 2021 NewsDesk

FILE PHOTOS: Chevron gas station sign seen in Del Mar, California, April 25, 2013. Chevron will report revenue on April 26. REUTERS / Mike Blake

SINGAPORE (Reuters) – Big US oil company Chevron Corp is operating a Wheatstone LNG plant in Western Australia at under capacity due to repairing inlet dividers, a senior company executive said.

“At Wheatstone, production is slightly below capacity while we are fixing the inlet separator,” Chief Financial Officer Pierre Breber said during an earnings conference call on Friday.

“We don’t expect a production impact in the second quarter.”

For the remainder of the year, the plant is expected to return to full capacity until maintenance is planned to begin at the end of the third quarter and continue into the fourth quarter, Chief Executive Officer Mike Wirth said in the same call.

Chevron temporarily shut down a unit separating natural gas and associated liquids at its Wheatstone offshore processing platform late last year after encountering problems during routine maintenance.

Meanwhile, refurbishment of Production Plant 1 at Chevron’s Gorgon LNG plant in Western Australia is nearing completion, with production units expected to be back online in March, Breber said.

“After Train 1 is back online, Train 3 will be terminated for propane ship inspection, repair and planned turnaround,” he added.

Maintenance on Train 3 is expected to occur in the second quarter, said Wirth.

Chevron agreed with regulators last August to gradually shut down Plants 1 and 3 at Australia’s second largest LNG plant for inspection after cracks were found in the propane kettles at Train 2.

Reporting by Jessica Jaganathan in Singapore and Sonali Paul in Melbourne; Edited by Rashmi Aich

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pakistan

The record price of LNG encourages South Asian countries to split gas, looking for other fuels | Instant News

January 15, 2021 NewsDesk

* Industrial users looking for alternative fuels such as LPG, fuel oil

* After blackout, warning of crisis in Pakistan

* India may see 2-3 fewer LNG cargoes in Feb-March than usual

AHMEDABAD, India / DHAKA / KARACHI, Pakistan Jan 15 (Reuters) – Pakistan and Bangladesh are rationing gas and buyers across South Asia seeking alternative fuels after spot prices for liquefied natural gas (LNG) soared to record highs, government and industry officials told Reuters .

LNG spot price LNG-AS has nearly tripled since early November as freezing temperatures across North Asia boost demand and deplete supplies. Since July, prices have risen by a dizzying 1,000%.

Natural gas and industrial power plants across the region save gas, with the scramble for other fuels driving demand for liquefied petroleum gas (LPG) and residual oil.

In Pakistan, which relies more on spot LNG imports for its winter needs, industrial gas use is restricted to certain hours and industry executives have warned the situation has become critical.

The recent power outages were partly due to a gas shortage after buyers who bought cheap LNG earlier in the year refused to pay during recent price spikes.

“The gas crisis currently facing the industry includes cutting off gas supplies to industry as well as low gas pressure,” said Saleem Uz Zaman, president of the Karachi Industry and Trade Association.

Sui Southern Gas Company, the gas distributor for Pakistan’s southern half, said in a letter to the industry association that it was facing an “emergency situation” and pegged a daily supply gap of around 200 million cubic feet.

In Bangladesh, the government has cut gas supplies to power plants due to lower electricity demand during winter, while maintaining a steady flow of gas to industry, said a senior official at state-run Petrobangla.

IMPORTED BULLETS CANCELED

Surging prices have led to the cancellation of orders from state-owned buyers Indian Oil Corp, LNG Pakistan and Rupantarita Prakriti Gas Co. from Bangladesh.

“LNG prices are going crazy … Over the last few tenders, we have had no response from suppliers,” said Rafiqul Islam, general manager at Rupantarita Prakriti.

“We are continuing our efforts to buy from the spot market … But it is very unlikely to get competitive prices in this very volatile market,” he said.

Reliance Industries, operator of west India’s largest refining complex, has almost stopped importing LNG and turned to cheaper alternatives, industry sources said. Reliance did not respond to a request for comment from Reuters.

South Asia has become a critical growth market for LNG, with imports by India, Pakistan and Bangladesh rising 8% in 2020 to a record 50.48 billion cubic meters (BCM) despite the coronavirus pandemic hitting the region’s economies, according to ship tracking data Refinitiv.

That growth rate is the second after China’s LNG import expansion by 11.5% in 2020.

SOUGHT ALTERNATIVE

Tile makers from Morbi, the center of India’s ceramics industry, have sought permission from local authorities to switch to alternative fuels such as LPG, the Morbi Ceramics Association wrote in a letter to officials on Jan. 9.

“Fuel is a significant input cost for us, accounting for 30% of the total production cost,” he said.

India’s consumption of fuel oil has also increased after the price of gas surged.

“Whatever fuel we produce is consumed here. We have not been able to build an inventory for the oil furnace, ”said an official at the Bharat Petroleum Corp refinery who declined to be named. “The situation is completely different from what happened after the COVID-19 outbreak … Nobody can afford LNG at this level.”

India could see 2 or 3 fewer cargoes in February and March than usual, said ES Ranganathan, head of marketing at India’s largest gas transmitter GAIL (India) Ltd.

However, he expects the impact of supply to customers to be minimal. GAIL will receive 32 cargoes this year under its long-term agreement with Gazprom compared to 24 years ago, he added.

Reporting by Sumit Khanna in Ahmedabad, Ruma Paul in Dhaka and Syed Raza Hassan in Karachi; Additional writing and reporting by Nidhi Verma in New Delhi; Edited by Florence Tan, Gavin Maguire and Edwina Gibbs

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Brazil

New Fortress Energy is betting on Brazilian LNG growth with the acquisition of Hygo | Instant News

January 14, 2021 NewsDesk

By Sabrina Valle, Rithika Krishna

RIO DE JANEIRO (Reuters) – US-based New Fortress Energy Inc said on Wednesday it would buy natural gas company Hygo Energy Transition Ltd for $ 2.18 billion to expand its presence in Brazil, the frontier for growth in the burgeoning liquefied natural gas market. developing.

New Fortress, an energy infrastructure company, is among the private sector players turning their sights to Brazil, where demand for super-cooled LNG is increasing, although the market is smaller than in India and China, where power generation is shifting away from more coal. dirty to natural gas.

With Brazil opening up its natural gas industry to private investors, other companies including oil major BP PLC and US-based EIG Global Partners are also planning multibillion-dollar investments in the country.

New Fortress, a growing competitor in the LNG industry, has a small liquefaction plant in Florida and ships LNG throughout the Caribbean. In the past year, its market value has jumped 286% to $ 10 billion, according to Refinitiv Eikon data. The company is building a larger LNG import terminal in Mexico.

The company will acquire all of Hygo’s outstanding shares for 31.4 million shares of NFE Class A common stock and $ 580 million in cash.

Brazil’s annual demand for LNG is expected to grow by more than 80% by 2021, the fastest rate in the world, although its starting point is relatively low compared to large Asian consumers, said Kristen Holmquist, forecasting specialist at Poten & Partners.

Unlike these countries, most of Brazil’s electricity comes from hydropower. This LNG supply is partly intended to replace the supply of natural gas from pipelines originating from Bolivia.

Hygo transports supercooled fuel and has become a key player in Brazil’s natural gas industry as state-controlled Petrobras sells assets, canceling what was almost a monopoly on the market.

Hygo – a 50-50% joint venture between US private equity firm Stonepeak Infrastructure Partners and Golar LNG – has recently invested in a number of LNG projects in Brazil for power generation. The company is also competing to operate a highly desirable LNG import terminal which is leased by Petrobras.

“There is strong growth in Brazil for electricity-powered projects,” Holmquist said in a webinar on Wednesday.

Hygo has told Reuters in 2020 that it plans to use LNG instead of diesel in trucks.

The transaction has a corporate value of $ 3.1 billion and an equity value of $ 2.18 billion, according to the statement.

The Hygo acquisition comes four months after the company’s trading debut in New York was suspended at the last minute after Brazilian federal prosecutors said the then company’s chief executive was appointed in the early stages of a corruption investigation, to activity at the company previously.

The CEO at the time, Eduardo Antonello, had left the company. He hasn’t been charged.

New Fortress also agreed to buy Hygo’s controlling company, Golar LNG Partners LP for about $ 251 million in general equity value and a company value of $ 1.9 billion.

Golar LNG Ltd was up 15% in US trading, while New Fortress Energy was up 10%.

Reporting by Sabrina Valle and Rithika Krishna; Edited by Maju Samuel, Krishna Chandra Eluri, Steve Orlofsky and David Gegoryo

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Brazil

EIG sells shares of the Brazil-Bolivia pipeline, eyeing Petrobras assets | Instant News

January 5, 2021 NewsDesk

By Sabrina Valle, Gram Slattery

RIO DE JANEIRO (Reuters) -EIG Global Energy Partners have sold Belgian Fluxys some of South America’s largest natural gas pipeline, removing regulatory barriers to buying a larger share of the Brazil-Bolivia pipeline, the EIG CEO said on Tuesday.

Blair Thomas, CEO of EIG, poses in this undated leaflet photo obtained January 5, 2021. Danthi Comunicacoes / via REUTERS THIS IMAGE HAS BEEN PROVIDED BY THIRD PARTIES.

US-based EIG wants to bid on a 51% stake in the pipeline owned by Brazilian state-owned oil company Petrobras, Chief Executive Blair Thomas told Reuters, as part of a broader move to enter the country’s burgeoning natural gas industry.

He said the antitrust issue blocking EIG’s bid for a stake in Petrobras was resolved by the sale of an undisclosed 27.5% stake in EIG in the Brazilian part of the pipeline known as Gasbol, linking Bolivia’s reserves to Brazil.

“It’s about freeing us up for a broader strategy,” Thomas said in a videoconference interview.

He said EIG, which manages a fund focused on energy assets, aims to create private sector alternatives to processing and transporting gas from major oil companies as the country develops the biggest offshore discovery of the century, known as pre-salt.

EIG is poised to spend billions to join partners in acquiring pipelines, processing plants and ultimately natural gas production in Brazil, said Thomas, as supply and demand for fuel grows in Latin America’s largest economy.

“We believe the energy transition and natural gas have a key role in that,” said Thomas.

The EIG stakes in Brazil come as Petroleo Brasileiro SA, as the state company is called, accelerates asset sales, ending what was almost a state-owned monopoly on natural gas five years ago.

He said EIG was also looking at the middle-aged offshore fields of Petrobras producing 150,000-200,000 barrels per day, including the legacy fields of Albacora and Marlim.

SHIFT AWAY FROM BOLIVIA

Gasbol links natural gas reserves in the Andean country to Brazil through two separate entities: Gas TransBoliviano SA (GTB) which owns and operates the Bolivian section and Transportadora Brasileira Gasoduto Bolívia-Brasil SA (TBG), its Brazilian partner.

The EIG fund holding the Brazil-Bolivia pipeline investment will be closed, Thomas said. The Bolivian side of the 2,600-kilometer (1,600-mile) pipeline, in which EIG owns a 38% stake, will eventually be sold as well, he said, without providing details.

Brazil has imported most of its natural gas from Bolivia in recent decades. But new oil and gas discoveries are slowly reducing this dependence and could turn Brazil into a gas exporter one day, Thomas said.

Together with cheap liquefied natural gas (LNG) imported by ships, Thomas said, offshore discoveries are likely to feed a growing consumer market driven by industrial use.

On Monday, EIG-backed natural gas company GNA received its first imported LNG cargo in Brazil. The supercooled fuel will be used in power plants which are expected to start commercial operations in the first half of 2021.

Brazil will now be a regular importer of LNG, Thomas said, and in 10-15 years the country may be ready for its first export plant, another EIG investment target.

“We really want to be first in that,” he said.

Reporting by Sabrina Valle and Gram Slattery Editing by Brad Haynes, Paul Simao, Grant McCool and David Gregorio

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