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, 29 July 22
GLENCORE TO SUPPLY COAL TO NIPPON STEEL AT $375 PER TON - BLOOMBERG
Glencore Plc, agreed to supply coal to Nippon Steel at one of the highest prices ever paid by the Japan Bloomberg reported on July 27.
...
Friday, 29 July 22
GLOBAL COAL DEMAND IS SET TO RETURN TO ITS ALL-TIME HIGH IN 2022 - IEA
The world’s consumption of coal is set to rise slightly in 2022, taking it back to the record level it reached nearly a decade ago, according ...
Thursday, 28 July 22
CREW FAMILIARISATION IS CRITICAL WHEN TAKING OVER A VESSEL - WEST P&I CLUB
Knowledge to Elevate
When a vessel changes ownership and/or manager, it can take some considerable time before the new crew and mana ...
Thursday, 28 July 22
RETURN OF COAL A THREAT TO EUROPEAN COMPANIES' ESG RATINGS - REUTERS
European companies turning to coal as an alternative to Russian gas face a hit to their environmental, social and governance ratings, leaving them ...
Wednesday, 27 July 22
MARKET INSIGHT - INTERMODAL
Amid the upcoming ban on Russian coal from the EU, which will be in full effect on August 10th, EU nations have been accelerating their coal import ...
|
|
|
Showing 271 to 275 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Gujarat Sidhee Cement - India
- CIMB Investment Bank - Malaysia
- Energy Development Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Sical Logistics Limited - India
- Chamber of Mines of South Africa
- Tata Chemicals Ltd - India
- Bulk Trading Sa - Switzerland
- PetroVietnam Power Coal Import and Supply Company
- Wood Mackenzie - Singapore
- European Bulk Services B.V. - Netherlands
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sakthi Sugars Limited - India
- Iligan Light & Power Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Orica Australia Pty. Ltd.
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Renaissance Capital - South Africa
- SMC Global Power, Philippines
- OPG Power Generation Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Makarim & Taira - Indonesia
- Mercuria Energy - Indonesia
- San Jose City I Power Corp, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Finance - Indonesia
- Jindal Steel & Power Ltd - India
- Bangladesh Power Developement Board
- Global Green Power PLC Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Trasteel International SA, Italy
- Electricity Authority, New Zealand
- Siam City Cement PLC, Thailand
- Ministry of Transport, Egypt
- Bharathi Cement Corporation - India
- Price Waterhouse Coopers - Russia
- Parry Sugars Refinery, India
- Goldman Sachs - Singapore
- Samtan Co., Ltd - South Korea
- PTC India Limited - India
- PNOC Exploration Corporation - Philippines
- Rio Tinto Coal - Australia
- Thiess Contractors Indonesia
- London Commodity Brokers - England
- Ceylon Electricity Board - Sri Lanka
- Parliament of New Zealand
- Directorate Of Revenue Intelligence - India
- Vijayanagar Sugar Pvt Ltd - India
- India Bulls Power Limited - India
- Barasentosa Lestari - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Aboitiz Power Corporation - Philippines
- Cement Manufacturers Association - India
- Jaiprakash Power Ventures ltd
- Central Java Power - Indonesia
- Mjunction Services Limited - India
- Bayan Resources Tbk. - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Lanco Infratech Ltd - India
- Salva Resources Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- SMG Consultants - Indonesia
- Bukit Baiduri Energy - Indonesia
- Kumho Petrochemical, South Korea
- Grasim Industreis Ltd - India
- Meenaskhi Energy Private Limited - India
- Sarangani Energy Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Electricity Generating Authority of Thailand
- Indika Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Meralco Power Generation, Philippines
- Coastal Gujarat Power Limited - India
- Ministry of Mines - Canada
- Carbofer General Trading SA - India
- Intertek Mineral Services - Indonesia
- Bhoruka Overseas - Indonesia
- Rashtriya Ispat Nigam Limited - India
- GAC Shipping (India) Pvt Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Eastern Energy - Thailand
- Tamil Nadu electricity Board
- Kobexindo Tractors - Indoneisa
- Independent Power Producers Association of India
- Gujarat Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
- South Luzon Thermal Energy Corporation
- Heidelberg Cement - Germany
- Uttam Galva Steels Limited - India
- Essar Steel Hazira Ltd - India
- Vizag Seaport Private Limited - India
- GMR Energy Limited - India
- Semirara Mining Corp, Philippines
- Videocon Industries ltd - India
- Holcim Trading Pte Ltd - Singapore
- Latin American Coal - Colombia
- Karaikal Port Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- IHS Mccloskey Coal Group - USA
- Orica Mining Services - Indonesia
- Antam Resourcindo - Indonesia
- Pendopo Energi Batubara - Indonesia
- Simpson Spence & Young - Indonesia
- Coalindo Energy - Indonesia
- Savvy Resources Ltd - HongKong
- TeaM Sual Corporation - Philippines
- Baramulti Group, Indonesia
- Aditya Birla Group - India
- Riau Bara Harum - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Chettinad Cement Corporation Ltd - India
- Singapore Mercantile Exchange
- Deloitte Consulting - India
- Neyveli Lignite Corporation Ltd, - India
- Indogreen Group - Indonesia
- Ind-Barath Power Infra Limited - India
- Port Waratah Coal Services - Australia
- Indonesian Coal Mining Association
- Siam City Cement - Thailand
- Alfred C Toepfer International GmbH - Germany
- GVK Power & Infra Limited - India
- Mercator Lines Limited - India
- Georgia Ports Authority, United States
- Malabar Cements Ltd - India
- Wilmar Investment Holdings
- Xindia Steels Limited - India
- Sree Jayajothi Cements Limited - India
- Altura Mining Limited, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Kalimantan Lumbung Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Eastern Coal Council - USA
- Krishnapatnam Port Company Ltd. - India
- Leighton Contractors Pty Ltd - Australia
- Larsen & Toubro Limited - India
- IEA Clean Coal Centre - UK
- Coal and Oil Company - UAE
- The University of Queensland
- Maharashtra Electricity Regulatory Commission - India
- Madhucon Powers Ltd - India
- Africa Commodities Group - South Africa
- Maheswari Brothers Coal Limited - India
- Petron Corporation, Philippines
- Marubeni Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Indian Energy Exchange, India
- Jorong Barutama Greston.PT - Indonesia
- International Coal Ventures Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Karbindo Abesyapradhi - Indoneisa
- Power Finance Corporation Ltd., India
- Toyota Tsusho Corporation, Japan
- Asmin Koalindo Tuhup - Indonesia
- Bukit Makmur.PT - Indonesia
- Vedanta Resources Plc - India
- Pipit Mutiara Jaya. PT, Indonesia
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- Thai Mozambique Logistica
- CNBM International Corporation - China
- SN Aboitiz Power Inc, Philippines
- Interocean Group of Companies - India
- Anglo American - United Kingdom
- Mintek Dendrill Indonesia
- Australian Commodity Traders Exchange
- Star Paper Mills Limited - India
- Agrawal Coal Company - India
- Minerals Council of Australia
- The Treasury - Australian Government
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Posco Energy - South Korea
- Indian Oil Corporation Limited
- ASAPP Information Group - India
- PowerSource Philippines DevCo
- Central Electricity Authority - India
- Merrill Lynch Commodities Europe
- Bahari Cakrawala Sebuku - Indonesia
- Bhushan Steel Limited - India
- Globalindo Alam Lestari - Indonesia
- Economic Council, Georgia
- Dalmia Cement Bharat India
- Ambuja Cements Ltd - India
- Romanian Commodities Exchange
- Miang Besar Coal Terminal - Indonesia
- Commonwealth Bank - Australia
- Sindya Power Generating Company Private Ltd
- Medco Energi Mining Internasional
- Cigading International Bulk Terminal - Indonesia
- The State Trading Corporation of India Ltd
- New Zealand Coal & Carbon
- ICICI Bank Limited - India
- Energy Link Ltd, New Zealand
- Standard Chartered Bank - UAE
- Billiton Holdings Pty Ltd - Australia
- Kideco Jaya Agung - Indonesia
- MS Steel International - UAE
- VISA Power Limited - India
- Edison Trading Spa - Italy
- Sojitz Corporation - Japan
- Banpu Public Company Limited - Thailand
- Bhatia International Limited - India
- White Energy Company Limited
- Planning Commission, India
- Attock Cement Pakistan Limited
- Directorate General of MIneral and Coal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- McConnell Dowell - Australia
- Global Coal Blending Company Limited - Australia
- Indo Tambangraya Megah - Indonesia
- Straits Asia Resources Limited - Singapore
- Global Business Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
|
| |
| |
|
