LNG Spot Prices Drop; Demand Dips from Brazil, Japan

MarineLink.com
Friday, February 28, 2014

By Oleg Vukmanovic and Jacob Gronholt-Pedersen,  Reuters

Asian spot liquefied natural gas (LNG) fell this week as demand from Brazil's Petrobras slackened and top Japanese buyers switched to cheaper fuels and relied more on supplies under long-term deals.

Prices for April delivery dropped to around $18.10 per million British thermal units (mmBtu) from $19.60 per mmBtu last week.

Petrobras, a major Atlantic Basin LNG buyer in recent weeks, withdrew from the global spot market after rainfall boosted Brazil's hydroelectric reserves and cut demand for gas-fired power generation, traders said.

Japanese utilities, meanwhile, increased deliveries of lower-cost LNG under long-term, oil-linked deals.

"Prices would rebound quickly if Petrobras had to come back into the market," a trade source said in light of finely balanced supply-demand.

"There is no additional supply available," he added.

Spot cargo trades were scant over the past week, resulting in a wide bid-offer spread of almost $2 per mmBtu, the same source said.

"The Asian buyers have already secured the necessary winter volumes ... not only for spot deals but also (through) short-term deals," Chubu Electric Power's head of trading, Hiroki Sato, told Reuters this week.

"In Chubu's case, if the spot price jumps above $18 (per mmBtu), it is better to buy oil," he said.

Sato added that Chubu did not expect LNG demand to rise this summer due to the probable restart of some of Japan's idled nuclear reactors.

Cargo Deals
German utility RWE appears to have bought a Norwegian LNG cargo from GDF Suez, which it has sold to Japanese utility Tokyo Electric Power, or Tepco, several sources said.

Portugal's Galp sold a cargo to Brazil's Petrobras for loading in mid-April at an estimated price in the mid-$16 per mmBtu level.

Galp's offer to sell 30 LNG cargoes over a five-year period closes in March, by which time traders have to submit bids.

Up to three cargoes due to be re-exported from Belgium's Zeebrugge and Spanish terminals in April will add to global spot availability, another trader said.

Malaysia's state-run Petronas is in advanced talks to buy 18 LNG cargoes from Algeria over a three-year period, sources with knowledge of the discussions said.

The move underscores Algeria's growing shift towards higher-margin LNG sales after halving pipeline exports to Italy last year.

A compressor leak at Angola's new export plant has delayed loading programmes and reduced output at the $10 billion project, which is due to shut for two months from July, a site manager said earlier this week.

Delays caused by a leaking valve at an air compressor unit have meant that LNG initially due to start being pumped aboard a waiting vessel on Tuesday this week has been pushed back to Monday next week.

Meanwhile, Gazprom Marketing & Trading has won a tender to deliver an LNG cargo to Argentina in early April, traders said.

Argentine state-run energy firm Enarsa issued a tender for two LNG cargoes to be delivered in April earlier this month. Out of two to three offers Enarsa received, it only awarded the single slot at the start of the month, a source said.

(editing by Jane Baird)

Maritime Reporter August 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Tanker Trends

Joe Barton: Lift Oil Export Ban

A senior U.S. Congressman from Texas has come out in full support of the United States lifting the 40-year old ban on crude oil exports, putting him at odds with

Russia's Shipping Major Reports Strong 1H 2014

OAO Sovcomflot (SCF Group), Russia’s largest shipping company and a global leader in seaborne energy transportation and offshore services, has announced its financial

Tankship-specific Version of FindaportCD Released

Harbour & terminal information providers, Shipping Guides Ltd, says its latest tanker-specific  addition enables customers to access the most comprehensive port

Energy

Halliburton to Settle US Gulf Spill Claims for $1.1b

Halliburton Co said it reached a $1.1 billion settlement for a majority of claims against the company for its role in the BP oil spill in the Gulf of Mexico in 2010.

Joe Barton: Lift Oil Export Ban

A senior U.S. Congressman from Texas has come out in full support of the United States lifting the 40-year old ban on crude oil exports, putting him at odds with

Brent Crude Slips Towards US$102

Brent crude fell towards $102 a barrel on Tuesday on concerns of slowing oil demand growth due to weak economic recoveries in China and Europe, although new unrest

LNG

Russia's Shipping Major Reports Strong 1H 2014

OAO Sovcomflot (SCF Group), Russia’s largest shipping company and a global leader in seaborne energy transportation and offshore services, has announced its financial

Skangass Granted Permission for LNG Terminal

The Swedish Government (Länsstyrelsen in Dalarnas Län) has granted Skangass permission to build and operate a new Terminal for LNG (Liquefied Natural Gas) within the harbour in Gävle, Sweden.

Policy Uncertainty Threatens to Slow Renewable Energy Momentum

IEA forecast sees renewable power as a cost-competitive option in an increasing number of cases, but facing growing risks to deployment over the medium term. The

News

Two MCS Exhaust Gas Boilers to Tersan Shipyard

Parat Halvorsen AS has been awarded new boiler plant contracts for two freezer trawlers to be built at Tersan Shipyard located in Telova, Turkey. The boiler plants are for Tersan¹s newbuildings No.

Halliburton to Settle US Gulf Spill Claims for $1.1b

Halliburton Co said it reached a $1.1 billion settlement for a majority of claims against the company for its role in the BP oil spill in the Gulf of Mexico in 2010.

RDS Wins Engineering and Design Contract for Sea Lion

Rig design and engineering specialist RDS has been awarded a front-end engineering design (FEED) contract by AMEC for Premier Oil’s Sea Lion development in the North Falklands Basin.

Logistics

Rickmers-Linie Appoints Interliner Agencies

Hamburg based Rickmers-Linie has appointed Interliner Agencies as its new agent in South Central Europe. The agency contract covers Slovenia, Austria, Czech Republic,

Joe Barton: Lift Oil Export Ban

A senior U.S. Congressman from Texas has come out in full support of the United States lifting the 40-year old ban on crude oil exports, putting him at odds with

Tankship-specific Version of FindaportCD Released

Harbour & terminal information providers, Shipping Guides Ltd, says its latest tanker-specific  addition enables customers to access the most comprehensive port

 
 
Maritime Contracts Maritime Security Maritime Standards Offshore Oil Pipelines Salvage Ship Repair Shipbuilding / Vessel Construction Sonar Winch
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1096 sec (9 req/sec)