LNG Market Outlook by Flex LNG
The LNG shipping market tightened throughout the third quarter, and rates increased sharply in October following gradual increases since May. This was due in part to strong LNG demand from China which helped to widen the arbitrage between spot LNG import prices in Europe, U.S. and Asia. This led to increased cargoes from the Atlantic basin and an associated increase of average sailing distances. The current market dynamic is supportive for a further increase in rates during a seasonally strong period of the year. It is also important to note that a relatively small portion of the global fleet of LNGC operates in the spot market (less than 10%), which can result in periods of increased volatility.
NextDecade in FSRU Deal with Flex LNG
NextDecade Global Solutions, a subsidiary of NextDecade, LLC, and FLEX LNG have signed a Heads of Agreement (HOA) to create a full value chain solution for customers looking to purchase LNG from NextDecade’s Rio Grande LNG export project in Brownsville, TX. Initially, NextDecade and FLEX LNG will develop Floating Storage and Regasification Unit (FSRU) and dockside solutions for international customers of NextDecade’s, with the LNG supply also provided by NextDecade. The agreement will reunite two pioneers of the floating LNG business, NextDecade Chair and CEO Kathleen Eisbrenner and Jonathan Cook who will become CEO of FLEX LNG early next year.
CMA CGM Increases Port Calls and TEU Capacity
French container line CMA CGM has announced imminent changes to its PCRF line service which links Northern Europe with the French West Indies, by adding two new calls at Zeebrugge and Rotterdam and increasing freight capacity on the route. The company says this will mean customers will benefit from the enhanced import and export cargo opportunities. During the first quarter of 2016, PCRF line’s capacity which links the French West Indies to Europe will be increased by replacing current 2,200 TEU capacity vessels by 2,800 TEU capacity vessels. This move supports regional growth of both the French Indies market, currently around 3%, and promotes intra-Caribbean trade developments.
Excelerate Energy & the Year of LNG
This being the “Yearbook” edition of Maritime Reporter & Engineering News, it would be remiss to not have coverage of LNG, one of the hottest fueling trends in maritime circles, particularly in North America. For a unique insight on a rapidly evolving market, MR caught up with Edward Scott, COO, Excelerate Energy, which is making big strides in the LNG Regasification sector, and recently received on the of the world’s largest and most capable units, the FSRU Experience which he touts as the world’s largest and most capable FSRU.
Excelerate Energy Orders FSRU Vessels from DSME
Excelerate Energy enters Into a shipbuilding option agreement with DSME for 8 New Floating Storage and Regasification Units (FSRUs). The option agreement with Daewoo Shipbuilding and Marine Engineering (DSME) is for the delivery of up to eight Floating Storage and Regasification Units (FSRUs) between early 2015 and early 2017. The agreement gives Excelerate, the world's largest operator of regasification vessels and developer of LNG import solutions, an increase in the size of its existing fleet of nine FSRUs as global demand for LNG import solutions continues to expand rapidly.
