Здравствуйте. Вся информация этого сайта бесплатна. Вы можете сделать пожертвование и поддержать наше развитие. Спасибо.

Hello. All information of this site is free of charge. You can make a donation and support our development. Thank you.

2016-03-31 19:15:00

LNG PROJECTS DOWN

LNG PROJECTS DOWN

The falling dominoes that are major liquefied natural gas (LNG) projects show that the industry needs a re-think on how it is structured and operates.

Up until now LNG has largely been about massive and costly projects undertaken by international majors on the basis that the billions of dollars being invested is guaranteed to make a good return because of long-term sales contracts to utilities.

But the scrapping of Woodside Petroleum's Browse floating LNG project off the coast of Western Australian state goes a long way to confirm that the model that has so far underpinned the development of the industry is no longer viable.

Woodside, which operates Australia's giant Northwest Shelf project as well as its own Pluto facility, is no newcomer to LNG, and it's telling that it couldn't envisage a way to make the $30-billion Browse project profitable in the current environment.

Woodside's partner in Browse, energy major Royal Dutch Shell, had previously flagged that the project would only work if it could be profitable at an oil price of less $50 a barrel. Given Brent crude is currently around $40, it seems the price hurdle was probably too great for Browse.

But so was the lack of customers keen to sign up to long-term, oil-linked contracts, something acknowledged by Woodside Chief Executive Peter Coleman.

Asian buyers now hold the whip hand in LNG pricing, given the rapid growth in supply from new projects in Australia, five of which have started in the past two years and three more planned to start by 2017.

In addition, the United States has exported its first LNG through the Sabine Pass facility and has four more projects currently under construction.

The problem is that all these new projects have altered the supply-demand balance to the point where it's hard to see the market being able to absorb all the available LNG, even if prices continue to slump.

Asian spot LNG was at $4.50 per million British thermal units (mmBtu) last week, close to the record low of $4.30 reached earlier this month and less than a quarter of the peak of $20.50 reached in February 2014.

It's not only the new supply that has driven prices lower, demand has been softer than expected, with Japan's imports dropping for a sixth consecutive month in February, in what may well be confirmation of a structural decline in the world's biggest buyer of the super-cooled fuel.

China, the big hope for LNG demand growth, has imported 14.3 percent more in the first two months of 2016 than it did for the same period last year, but it's worth noting that imports actually fell 1 percent last year.

The spike in LNG purchases so far this year is most likely related to increased use of natural gas for heating, and this may not be sustained as winter comes to an end.

However, overall China should still be a growth story for natural gas, given the authorities' determination to rely less on polluting coal.

There is also the potential for greater LNG imports across Southeast Asia, with more countries planning to use the fuel, including Bangladesh, Myanmar, Vietnam and the Philippines.

Traditional exporters Indonesia and Malaysia may well end up as net importers as well, given the depletion of their domestic natural gas fields and rising demand at home.

But even if demand can rise to meet existing and under construction supply, this doesn't necessarily support the development of a raft of proposed projects.

DOWNSTREAM KEY TO FUTURE PROJECTS

There are proposals for new ventures in Australia, Canada, the United States, Russia and Mozambique, to name just a few.

While some of these aim to be floating LNG platforms and some more conventional onshore plants, one thing they all have in common is that they will cost billions of dollars each.

It's very hard to see multi-billion dollar projects moving to final investment decisions if long-term customers aren't signed up.

What this means is that if any of these planned ventures are to see the light of day, their proponents will have to do more than build them in the hope that buyers will come.

The industry needs to consider going downstream in order to ensure its long-term viability.

Much like oil companies' move from producing oil into refining it and then retailing fuels, so too will LNG companies have to find ways to establish a sustainable market that will create and maintain demand for their product.

This means investing in re-gasification terminals in developing nations, along with associated pipeline infrastructure and storages.

It may also mean building gas-fired power plants, transmission grids and or even partnering with companies at the retail level to install gas-powered heating systems in buildings and residences.

It may be too much to expect companies such as Woodside, Shell, Chevron and Exxon Mobil to do this on their own in fairly challenging markets, such as those in Asia or Africa.

But they should be considering how best to partner with local companies in these countries to build out a network that could create sufficient LNG demand to once again justify the building of vastly expensive liquefaction projects.

reuters.com

-----

More: 

U.S. LNG FOR TURKEY 

U.S. LNG FOR EUROPE 

AUSTRALIAN LNG: $400 BLN DOWN 

RUSSIAN LNG AMBITIONS 

AUSTRALIAN LNG: TO JAPAN 

U.S. LNG UP

 

Tags: LNG, GAS

Chronicle:

LNG PROJECTS DOWN
2018, February, 16, 23:15:00

DEWA INVESTS $22 BLN

AOG - The Dubai Electricity & Water Authority (DEWA) is to invest around $22bn on new energy projects across the next five years, with the renewables sector accounting for an increasing share of electricity generation, according to CEO Saeed Mohammed Al Tayer.

LNG PROJECTS DOWN
2018, February, 16, 23:10:00

TRANSCANADA NET INCOME $3.0 BLN

TRANSCANADA - TransCanada Corporation (TSX:TRP) (NYSE:TRP) (TransCanada or the Company) announced net income attributable to common shares for fourth quarter 2017 of $861 million or $0.98 per share compared to a net loss of $358 million or $0.43 per share for the same period in 2016. For the year ended December 31, 2017, net income attributable to common shares was $3.0 billion or $3.44 per share compared to net income of $124 million or $0.16 per share in 2016.

LNG PROJECTS DOWN
2018, February, 16, 23:05:00

RUSSIAN NUCLEAR FOR CONGO

ROSATOM - February 13, 2018, Moscow. – ROSATOM and the Ministry of Scientific Research and Technological Innovations of the Republic of Congo today signed a Memorandum of Understanding on cooperation in the field of peaceful uses of atomic energy.

LNG PROJECTS DOWN
2018, February, 16, 23:00:00

U.S. INDUSTRIAL PRODUCTION DOWN 0.1%

FRB - Industrial production edged down 0.1 percent in January following four consecutive monthly increases. Manufacturing production was unchanged in January. Mining output fell 1.0 percent, with all of its major component industries recording declines, while the index for utilities moved up 0.6 percent. At 107.2 percent of its 2012 average, total industrial production was 3.7 percent higher in January than it was a year earlier. Capacity utilization for the industrial sector fell 0.2 percentage point in January to 77.5 percent, a rate that is 2.3 percentage points below its long-run (1972–2017) average.

All Publications »