We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Tuesday, 01 September 20
COVID-19 PUSHES US LNG INTO A TIGHT SPOT - DREWRY
The pandemic-led weak projections for economic growth will derail US LNG exports in full-year 2020 with the country also losing ground in the long term due to major delays in liquefaction projects.
US LNG exports were strong between 2017 and 2019, driven by the shale gas boom, rising demand for natural gas in Asia and higher global LNG prices. The US exported 3.9 million tonnes of LNG in 2016 which increased at a whopping 114% CAGR to 38.2 million tonnes in 2019.
The US is currently the third-largest global LNG exporter with six operational LNG export terminals aggregating 62 mtpa of liquefaction capacity and another 41 mtpa capacity under construction. Brownfiled projects such as Sabine Pass, Corpus Christi, Cameron LNG and Elba Island will reach their full capacities between 2020 and 2027 and greenfield projects such as Golden Pass LNG and Calcasieu Pass will become operational during the same period.
Existing LNG production capacity in the US has been impacted by the pandemic with over 110 LNG cargoes being cancelled by Asian and European customers during June-August due to the low LNG spot price which narrowed the US-Asia and US-Europe price arbitrage. Moreover, major US LNG importers – Japan, South Korea and Taiwan – have seen their LNG demand dwindling, while US-China LNG trade has not been able to pick up as some would have hoped. With projections for LNG spot prices below $5 per MMBtu over the next few years, we expect more cancellations to occur in the coming years making the US a ‘swing LNG producer.’
The ‘second wave’ of LNG liquefaction including mega-LNG projects (such as Driftwood LNG, Port Arthur LNG, Golden Pass, Calcasieu LNG, Plaquemines LNG, Magnolia LNG, Jordan Cove LNG and Rio Grande LNG) constitute over 160 mtpa of planned liquefaction capacity. These projects were initially expected to be operational by 2025, but are currently facing major trouble in securing funding and long-term supply deals required for reaching an FID. Only two projects (Golden Pass and Calcasieu Pass LNG) have attained the FID and have started construction, while over 10 major LNG liquefaction projects which were expected to reach the FID in 2020 have been delayed due to low LNG prices and weak economic growth projections.
The future for these projects looks uncertain as most of them had fixed the all-inclusive selling price for LNG at $8 per MMBtu for Asia ($2 for Henry Hub, $3 for liquefaction, $2-3 transportation) which is highly uncompetitive in the current market. Only a marginal recovery in LNG prices is projected for the next few years which further increases the woes for promoters of the planned projects in securing funding and supply deals. Meanwhile, a major competitor for US LNG, Qatar enjoys a break-even price below $2 per MMBtu as well as proximity to the Asian market. Qatar’s North Field Expansion (NFE) project’s Phase-1 (33 mtpa) and Phase-2 (16 mtpa) are also backed by the government, increasing the probability of their completion and in the process creating more trouble for the planned US projects.
The pandemic has already created severe financial woes for some US projects. For instance, a deal between Driftwood’s promoter Tellurian and India’s Petronet LNG fell through, raising doubts over the proposed 27.6 mtpa project. Although negotiations are still underway, Tellurian faces high competition from Russian and African projects. Shell has also exited the Lake Charles LNG project, increasing the uncertainty of the project for the other participants, while Magnolia LNG’s promoter LNG Ltd has been taken over by another entity after it went bankrupt, delaying the project further.
Some projects like Lake Charles and Rio Grande have gone back to the drawing board and plan to reduce trains to decrease the capex cost while others are cutting workforce and raising loans to keep their projects afloat. Most project developers are hopingfor an easing of US-China tensions and the prospect of securinga share of the rising LNG demand in China, which is projected to grow at over 10% CAGR between 2020 and 2025. However, China’s LNG importers may not be too keen on long-term supply deals with US companies given the current low prices and the uncertainty over US-China trade relations. Ties between China and Qatar are also strengthening with the latter reserving 16 LNG carrier newbuild berths at a Chinese shipyard.
Overall, project delays are expected to hurt the US deeply in the long term while other LNG producers – Qatar, Russia and Mozambique – gain from the narrowing supply-demand gap from 2023 onwards. Qatar has already reserved LNG carrier newbuilding berths at shipyards and has selected a technology partner for the NFE project while Russia’s Arctic LNG-2 is on schedule with added investments made for Arc-7 LNG carriers and large FSUs to keep the Northern Sea Route (NSR) active most of the year.
US LNG woes have had a cascading effect on the LNG shipping market, depressing charter rates. The fall in US-Asia LNG trade has negatively affected shipping demand which, along with cancellations, has increased vessel availability in the market. At present, the fall in charter rates is arrested by a rise in floating storage, but this situation is not sustainable in the long term with LNG prices remaining depressed and over 120 LNG carriers scheduled to be delivered during 2020-21.
An estimated 140 new orders for LNG carriers during 2020-23 would be left hanging if the planned US LNG projects fail to progress. The loss of orders will impact LNG shipyards which have already begun to reel under low orders (only eight vessels were ordered in 1H20). While project-linked ordering from Qatar, Russia and Mozambique will bring some respite the drying up of speculative orders will most certainly be a huge loss for the LNG shipping market as a whole.
To conclude US LNG exports will grow at a slower pace in the coming years as long-term supply deals have already been signed for the under-construction projects. However, stiff competition from other producers amid low LNG prices will impact their share in the Asian market. The fall in US-Asia trade will negatively impact shipping demand and further reduce the number of vessels required for LNG trade. Overall, we expect US LNG exports to be seasonal in the long run with Europe playing a much larger role in the future.
Source: Drewry
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Friday, 27 August 21
THE ECONOMICS OF INDONESIA’S DIESEL POWER PLANT TO GAS CONVERSION PLAN ARE PROBLEMATIC - IEEFA
Deploying new small-scale LNG is an uphill battle for PGN
Indonesian gas is currently in a precarious position, where the government needs to ...
Thursday, 26 August 21
INDIA IMPORTED 17.06 MLN TONNES OF LPG IN 2020; UP 11.5% Y-O-Y
Global LPG trade remained fairly positive in 2020, despite the global economic impact from COVID-19, and surged strongly in the first half of 2021. ...
Thursday, 26 August 21
MARKET INSIGHT - INTERMODAL
24th of August 2021, the Baltic Dry Index reached 4,201, a YTD high and the highest since May 2010.
Cape 5TC daily average @ 51,472
...
Tuesday, 24 August 21
COAL PRICE RALLY TO PRESSURE CHINESE POWER GENCOS’ MARGINS FITCH RATINGS
Fitch Ratings expects the pressure on Chinese power generation companies’ (gencos) profit from the recent coal price surge to weaken their cr ...
Tuesday, 24 August 21
TIGHT POWER SUPPLY IN CHINA AMID STRONG DEMAND, HIGH COAL PRICES - FITCH RATINGS
China experienced tight power supply in 1H21 on stronger than expected power demand as economic activity continued to recover, Fitch Ratings says i ...
|
|
|
Showing 496 to 500 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Economic Council, Georgia
- Rashtriya Ispat Nigam Limited - India
- Iligan Light & Power Inc, Philippines
- Sical Logistics Limited - India
- Bhushan Steel Limited - India
- Kaltim Prima Coal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Singapore Mercantile Exchange
- IHS Mccloskey Coal Group - USA
- White Energy Company Limited
- Semirara Mining Corp, Philippines
- Attock Cement Pakistan Limited
- Oldendorff Carriers - Singapore
- Toyota Tsusho Corporation, Japan
- Meenaskhi Energy Private Limited - India
- Posco Energy - South Korea
- Agrawal Coal Company - India
- Global Business Power Corporation, Philippines
- Anglo American - United Kingdom
- Minerals Council of Australia
- India Bulls Power Limited - India
- Planning Commission, India
- Parry Sugars Refinery, India
- London Commodity Brokers - England
- Pendopo Energi Batubara - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Malabar Cements Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Central Java Power - Indonesia
- Altura Mining Limited, Indonesia
- Power Finance Corporation Ltd., India
- New Zealand Coal & Carbon
- Sinarmas Energy and Mining - Indonesia
- Globalindo Alam Lestari - Indonesia
- Antam Resourcindo - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Heidelberg Cement - Germany
- Sakthi Sugars Limited - India
- Formosa Plastics Group - Taiwan
- Romanian Commodities Exchange
- Latin American Coal - Colombia
- Kideco Jaya Agung - Indonesia
- Kepco SPC Power Corporation, Philippines
- Mintek Dendrill Indonesia
- Manunggal Multi Energi - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Therma Luzon, Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jindal Steel & Power Ltd - India
- Larsen & Toubro Limited - India
- Ind-Barath Power Infra Limited - India
- Medco Energi Mining Internasional
- Krishnapatnam Port Company Ltd. - India
- Sree Jayajothi Cements Limited - India
- Semirara Mining and Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Timah Investasi Mineral - Indoneisa
- SN Aboitiz Power Inc, Philippines
- Commonwealth Bank - Australia
- Chettinad Cement Corporation Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Indika Energy - Indonesia
- Marubeni Corporation - India
- IEA Clean Coal Centre - UK
- Leighton Contractors Pty Ltd - Australia
- Ministry of Mines - Canada
- Karaikal Port Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Australian Coal Association
- Tata Chemicals Ltd - India
- Simpson Spence & Young - Indonesia
- Orica Mining Services - Indonesia
- South Luzon Thermal Energy Corporation
- Bharathi Cement Corporation - India
- Mercuria Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Bhatia International Limited - India
- GVK Power & Infra Limited - India
- Wilmar Investment Holdings
- Alfred C Toepfer International GmbH - Germany
- Mercator Lines Limited - India
- Sindya Power Generating Company Private Ltd
- Trasteel International SA, Italy
- Intertek Mineral Services - Indonesia
- Chamber of Mines of South Africa
- Georgia Ports Authority, United States
- OPG Power Generation Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Bangladesh Power Developement Board
- Bulk Trading Sa - Switzerland
- Gujarat Sidhee Cement - India
- Grasim Industreis Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Rio Tinto Coal - Australia
- Straits Asia Resources Limited - Singapore
- Price Waterhouse Coopers - Russia
- Port Waratah Coal Services - Australia
- Eastern Coal Council - USA
- Salva Resources Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- AsiaOL BioFuels Corp., Philippines
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- Banpu Public Company Limited - Thailand
- Meralco Power Generation, Philippines
- Cement Manufacturers Association - India
- Aboitiz Power Corporation - Philippines
- Siam City Cement - Thailand
- Makarim & Taira - Indonesia
- PowerSource Philippines DevCo
- The State Trading Corporation of India Ltd
- GN Power Mariveles Coal Plant, Philippines
- Central Electricity Authority - India
- Kumho Petrochemical, South Korea
- Coastal Gujarat Power Limited - India
- MS Steel International - UAE
- Mjunction Services Limited - India
- Metalloyd Limited - United Kingdom
- Thiess Contractors Indonesia
- ICICI Bank Limited - India
- Directorate Of Revenue Intelligence - India
- Standard Chartered Bank - UAE
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Coalindo Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Eastern Energy - Thailand
- Deloitte Consulting - India
- Borneo Indobara - Indonesia
- Star Paper Mills Limited - India
- Kobexindo Tractors - Indoneisa
- Barasentosa Lestari - Indonesia
- Essar Steel Hazira Ltd - India
- Merrill Lynch Commodities Europe
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Edison Trading Spa - Italy
- CNBM International Corporation - China
- Ministry of Transport, Egypt
- Bahari Cakrawala Sebuku - Indonesia
- Bayan Resources Tbk. - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- ASAPP Information Group - India
- Sarangani Energy Corporation, Philippines
- Goldman Sachs - Singapore
- Petron Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Riau Bara Harum - Indonesia
- Renaissance Capital - South Africa
- Wood Mackenzie - Singapore
- Karbindo Abesyapradhi - Indoneisa
- European Bulk Services B.V. - Netherlands
- TeaM Sual Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- SMG Consultants - Indonesia
- Indo Tambangraya Megah - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Global Coal Blending Company Limited - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kartika Selabumi Mining - Indonesia
- Siam City Cement PLC, Thailand
- Sojitz Corporation - Japan
- Lanco Infratech Ltd - India
- Madhucon Powers Ltd - India
- CIMB Investment Bank - Malaysia
- Ministry of Finance - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Independent Power Producers Association of India
- LBH Netherlands Bv - Netherlands
- GAC Shipping (India) Pvt Ltd
- The Treasury - Australian Government
- Aditya Birla Group - India
- Jaiprakash Power Ventures ltd
- Coal and Oil Company - UAE
- Baramulti Group, Indonesia
- Bhoruka Overseas - Indonesia
- Dalmia Cement Bharat India
- SMC Global Power, Philippines
- Indian Oil Corporation Limited
- Global Green Power PLC Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- McConnell Dowell - Australia
- Ambuja Cements Ltd - India
- Xindia Steels Limited - India
- Vedanta Resources Plc - India
- Cigading International Bulk Terminal - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Parliament of New Zealand
- Electricity Authority, New Zealand
- Indonesian Coal Mining Association
- Videocon Industries ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Energy Development Corp, Philippines
- Savvy Resources Ltd - HongKong
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- PTC India Limited - India
- VISA Power Limited - India
- Orica Australia Pty. Ltd.
- Thai Mozambique Logistica
- The University of Queensland
- Carbofer General Trading SA - India
- San Jose City I Power Corp, Philippines
- Australian Commodity Traders Exchange
- Interocean Group of Companies - India
- Indian Energy Exchange, India
- Kohat Cement Company Ltd. - Pakistan
- PNOC Exploration Corporation - Philippines
- Binh Thuan Hamico - Vietnam
- Electricity Generating Authority of Thailand
|
| |
| |
|
