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Friday, 08 May 20
LNG DEMAND FACED SEVERAL HEADWINDS IN THE FIRST QUARTER OF 2020 - GASLOG
 LNG demand faced several headwinds in the first quarter of 2020 including a warmer than average winter in the northern hemisphere, high inventory levels of natural gas and LNG in several of the largest end markets for LNG and the outbreak of COVID-19, the impact of which has had an uneven distribution around the world during the year to date. For example, Chinese demand was 15 million tonnes (“mt”) in the first quarter of 2020, a decrease of 5% over the first quarter of 2019, according to Poten, but apparent demand in April has increased year-on-year based on vessel tracking data, including several cargoes exported from the U.S., GasLog says in its latest financial report.
Gaslog further noted, meanwhile, demand from Northern Asia more broadly (Japan, China, South Korea and Taiwan) grew by approximately 1 mt in the first quarter or 3% year-over-year. In addition, demand from India grew by nearly 2 mt in the first quarter of 2020 (or 37%) as the country looked to take advantage of historically low gas prices, although apparent demand in April is likely to be lower year-on-year based on vessel tracking data. Finally, demand from Europe grew by over 4 mt (or 37%) as gas pricing favored coal-to-gas switching for power generation and LNG replaces indigenous gas production. In total, LNG demand was 98 mt in the first quarter of 2020, compared to 89 mt in the first quarter of 2019, or an increase of 10%.
Wood Mackenzie currently expects global LNG demand to grow 21 mt or 6% this year, slower than the 26 mt or 7% it anticipated earlier this year prior to the global outbreak of COVID-19. Nonetheless, the demand for LNG over the near-term continues to be uncertain as many LNG importing countries either continue to have in effect shelter-in-place orders which prevent the operation of businesses deemed to be “non-essential” or are in the early stages of reopening their economies. Consequently, measures of global economic activity have declined significantly from comparable periods in 2019. However, the longer-term outlook for LNG demand remains favorable with demand growth of 92 mt estimated over the 2019-2025 timeframe, or compound annual growth of approximately 4%, according to Wood Mackenzie.
According to GasLog's latest financial report, global LNG supply was approximately 98 mt in the first quarter of 2020, an increase of 10 mt over the first quarter of 2019 (or 11%), primarily due to new supply additions in the U.S. (Cameron T1 and T2, Freeport T1, T2 and T3 and Elba Island), according to estimates from Wood Mackenzie. LNG supply is estimated to grow by 22 mt this year as the third train of Cameron begins operations and recent capacity additions continue to increase production. Further ahead, approximately 97 mt of new LNG capacity is expected to begin production during 2021-2025. However, Wood Mackenzie expects the pace of new project sanctions to slow significantly in 2020 due to the uncertainties caused by the COVID-19 outbreak in long-term demand for LNG and low global energy prices, in particular crude oil prices due to oversupply following a collapse in oil demand due to the COVID-19 virus.
In the LNG shipping spot market, tri-fuel diesel electric vessel (“TFDE”) headline rates, as reported by Clarksons, averaged $57,000 per day in the first quarter of 2020, a decrease from the averages of $108,000 in the fourth quarter of 2019 and $59,500 in the first quarter of 2019. Headline spot rates for steam turbine propulsion (“Steam”) vessels averaged $40,000 per day in the first quarter of 2020, a decrease from the average of $78,000 per day in the fourth quarter of 2019 but approximately in line with the $39,000 per day observed in the first quarter of 2019. Slower than expected LNG demand growth due in part to the impact of COVID-19 (as detailed above), high global inventories of natural gas and LNG following a warmer than average winter in the Northern Hemisphere and limited opportunities for LNG arbitrage trading between Atlantic and Pacific basins impacted headline spot rates in the first quarter of 2020.
Clarksons currently assesses headline spot rates for TFDE and Steam LNG carriers at $32,500 per day and $23,000 per day, respectively. The COVID-19 outbreak has introduced significant uncertainty regarding demand for LNG, and consequently, demand for LNG shipping over the near term. The combined impact of the COVID-19 outbreak and normal seasonality may lead to greater volatility in spot rates and to lower utilization of vessels trading in the spot and short-term markets, in particular Steam vessels. In addition, global gas prices and gas price differentials remain near historic lows in the key markets of North Asia and Europe, limiting the opportunities for inter-basin arbitrage trading and likely reducing average voyage distances as well as potentially reducing global output of LNG over the near-term, particularly in the U.S., where a number of cargo deferrals and/or cancellations have been reported for this summer, said GasLog.
As of May 5, 2020, the orderbook totals 118 dedicated LNG carriers (>100,000 cbm), according to estimates from Poten, representing 22% of the on-the-water fleet. Of these, 74 vessels (or 63%) have multi-year charters. The pace of newbuild ordering has slowed significantly relative to 2018-19, with only 4 newbuildings ordered so far in 2020 and all of them ordered against multi-year contracts, an encouraging development for the future supply and demand balance of LNG carriers.
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Friday, 31 July 20
BOTSWANA PLANS MORE COAL-FIRED POWER AS AFRICAN SOLAR ACCELERATES - IEEFA
An African economic leader like Botswana should embrace solar to reduce subsidies and tariff hikes
As Sub-Saharan solar ambition has ...
Wednesday, 29 July 20
2019 U.S. COAL PRODUCTION FALLS TO ITS LOWEST LEVEL SINCE 1978 - EIA
In 2019, U.S. coal production totaled 706 million short tons (MMst), a 7% decrease from the 756 MMst mined in 2018. Last year’s production wa ...
Wednesday, 29 July 20
MARKET INSIGHT - INTERMODAL
The dry bulk sector is beginning to recover from reduced SnP activity recorded in the first quarter of 2020. The table below illustrates that appro ...
Tuesday, 28 July 20
DEUTSCHE BANK TO END GLOBAL BUSINESS ACTIVITIES IN COAL MINING BY 2025 - REUTERS
Deutsche Bank, in a revamp of its policies for fossil fuels, said on Monday that it would end business activities worldwide related to coal mining ...
Monday, 27 July 20
IEEFA ENERGY FINANCE CONFERENCE 2020: COAL, LNG, PETROCHEMICAL SECTORS FACE POOR OUTLOOK AND UPHILL BATTLE FOR INVESTORS
Fossil fuel industries were becoming less financially attractive even before the global coronavirus pandemic
Three major fossil fuel ...
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- Siam City Cement - Thailand
- Intertek Mineral Services - Indonesia
- Lanco Infratech Ltd - India
- Bulk Trading Sa - Switzerland
- New Zealand Coal & Carbon
- Sakthi Sugars Limited - India
- Electricity Authority, New Zealand
- OPG Power Generation Pvt Ltd - India
- Indika Energy - Indonesia
- Edison Trading Spa - Italy
- White Energy Company Limited
- Commonwealth Bank - Australia
- Economic Council, Georgia
- Bukit Baiduri Energy - Indonesia
- Independent Power Producers Association of India
- Vijayanagar Sugar Pvt Ltd - India
- VISA Power Limited - India
- Aboitiz Power Corporation - Philippines
- Karbindo Abesyapradhi - Indoneisa
- The Treasury - Australian Government
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Vedanta Resources Plc - India
- Ministry of Mines - Canada
- Kapuas Tunggal Persada - Indonesia
- Latin American Coal - Colombia
- SMG Consultants - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Bukit Makmur.PT - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Semirara Mining Corp, Philippines
- Cement Manufacturers Association - India
- Leighton Contractors Pty Ltd - Australia
- PTC India Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Port Waratah Coal Services - Australia
- Gujarat Mineral Development Corp Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Georgia Ports Authority, United States
- Maharashtra Electricity Regulatory Commission - India
- San Jose City I Power Corp, Philippines
- GMR Energy Limited - India
- Borneo Indobara - Indonesia
- Coastal Gujarat Power Limited - India
- Tamil Nadu electricity Board
- South Luzon Thermal Energy Corporation
- Africa Commodities Group - South Africa
- GAC Shipping (India) Pvt Ltd
- Mjunction Services Limited - India
- Energy Development Corp, Philippines
- Gujarat Sidhee Cement - India
- Wilmar Investment Holdings
- Therma Luzon, Inc, Philippines
- Marubeni Corporation - India
- Pendopo Energi Batubara - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Indonesian Coal Mining Association
- Mercator Lines Limited - India
- Mercuria Energy - Indonesia
- Romanian Commodities Exchange
- GVK Power & Infra Limited - India
- Kartika Selabumi Mining - Indonesia
- Manunggal Multi Energi - Indonesia
- Orica Mining Services - Indonesia
- Essar Steel Hazira Ltd - India
- Indogreen Group - Indonesia
- Banpu Public Company Limited - Thailand
- Chettinad Cement Corporation Ltd - India
- Parry Sugars Refinery, India
- Kideco Jaya Agung - Indonesia
- Rio Tinto Coal - Australia
- Trasteel International SA, Italy
- McConnell Dowell - Australia
- PNOC Exploration Corporation - Philippines
- Cigading International Bulk Terminal - Indonesia
- Sarangani Energy Corporation, Philippines
- Medco Energi Mining Internasional
- Bukit Asam (Persero) Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Goldman Sachs - Singapore
- Australian Coal Association
- Sindya Power Generating Company Private Ltd
- Bharathi Cement Corporation - India
- Central Electricity Authority - India
- Parliament of New Zealand
- Ambuja Cements Ltd - India
- Videocon Industries ltd - India
- Directorate Of Revenue Intelligence - India
- Krishnapatnam Port Company Ltd. - India
- Directorate General of MIneral and Coal - Indonesia
- Kobexindo Tractors - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Green Power PLC Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Jaiprakash Power Ventures ltd
- Sree Jayajothi Cements Limited - India
- Aditya Birla Group - India
- Neyveli Lignite Corporation Ltd, - India
- IEA Clean Coal Centre - UK
- Makarim & Taira - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Baramulti Group, Indonesia
- Larsen & Toubro Limited - India
- Heidelberg Cement - Germany
- Mintek Dendrill Indonesia
- Iligan Light & Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- PowerSource Philippines DevCo
- Kalimantan Lumbung Energi - Indonesia
- Barasentosa Lestari - Indonesia
- Standard Chartered Bank - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Ind-Barath Power Infra Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maheswari Brothers Coal Limited - India
- Kumho Petrochemical, South Korea
- London Commodity Brokers - England
- Posco Energy - South Korea
- Salva Resources Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Samtan Co., Ltd - South Korea
- ASAPP Information Group - India
- Agrawal Coal Company - India
- The State Trading Corporation of India Ltd
- The University of Queensland
- CNBM International Corporation - China
- Bhoruka Overseas - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Altura Mining Limited, Indonesia
- Uttam Galva Steels Limited - India
- Coalindo Energy - Indonesia
- Tata Chemicals Ltd - India
- Indian Energy Exchange, India
- Karaikal Port Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- Antam Resourcindo - Indonesia
- ICICI Bank Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Planning Commission, India
- Petron Corporation, Philippines
- Energy Link Ltd, New Zealand
- Thai Mozambique Logistica
- Gujarat Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Metalloyd Limited - United Kingdom
- Meenaskhi Energy Private Limited - India
- Interocean Group of Companies - India
- Toyota Tsusho Corporation, Japan
- Merrill Lynch Commodities Europe
- Price Waterhouse Coopers - Russia
- TeaM Sual Corporation - Philippines
- Formosa Plastics Group - Taiwan
- LBH Netherlands Bv - Netherlands
- Bahari Cakrawala Sebuku - Indonesia
- Sical Logistics Limited - India
- Bayan Resources Tbk. - Indonesia
- Attock Cement Pakistan Limited
- Renaissance Capital - South Africa
- Madhucon Powers Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Bhatia International Limited - India
- Siam City Cement PLC, Thailand
- Global Business Power Corporation, Philippines
- Bangladesh Power Developement Board
- Orica Australia Pty. Ltd.
- Central Java Power - Indonesia
- Australian Commodity Traders Exchange
- Savvy Resources Ltd - HongKong
- Singapore Mercantile Exchange
- Anglo American - United Kingdom
- Indian Oil Corporation Limited
- Bhushan Steel Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- India Bulls Power Limited - India
- Power Finance Corporation Ltd., India
- Xindia Steels Limited - India
- Meralco Power Generation, Philippines
- Globalindo Alam Lestari - Indonesia
- Simpson Spence & Young - Indonesia
- Grasim Industreis Ltd - India
- CIMB Investment Bank - Malaysia
- Carbofer General Trading SA - India
- Ministry of Transport, Egypt
- Binh Thuan Hamico - Vietnam
- Dalmia Cement Bharat India
- European Bulk Services B.V. - Netherlands
- SMC Global Power, Philippines
- Straits Asia Resources Limited - Singapore
- Eastern Coal Council - USA
- Thiess Contractors Indonesia
- Rashtriya Ispat Nigam Limited - India
- Malabar Cements Ltd - India
- Star Paper Mills Limited - India
- Vizag Seaport Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- Chamber of Mines of South Africa
- Global Coal Blending Company Limited - Australia
- Riau Bara Harum - Indonesia
- Deloitte Consulting - India
- AsiaOL BioFuels Corp., Philippines
- International Coal Ventures Pvt Ltd - India
- MS Steel International - UAE
- Eastern Energy - Thailand
- Minerals Council of Australia
- Kaltim Prima Coal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Ministry of Finance - Indonesia
- Jindal Steel & Power Ltd - India
- Wood Mackenzie - Singapore
- Sojitz Corporation - Japan
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