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.
|
|
Thursday, 27 January 22
2022 - A YEAR OF REBALANCING FOR METALS AND MINING - WOOD MACKENZIE
If 2021 was the year of rebound for metals and mining (M&M) commodities, then 2022 is shaping as the year of rebalance, says Wood Mackenzie, a ...
Wednesday, 26 January 22
MARKET INSIGHT - INTERMODAL
While it is logical that most of the S&P reports of the first weeks of the year are linked to very limited activity as reflected in the weekly ...
Wednesday, 26 January 22
INDONESIA: DME PROJECT IS ECONOMICALLY VIABLE AS STUDY DEMONSTRATES
The government is encouraging downstream coal processing or increase in coal added value, for example by turning coal into Dimethyl Ether (DME) to ...
Wednesday, 26 January 22
COMMODITY PRICES COULD SOAR IF THE RUSSIA-UKRAINE CRISIS ESCALATES - ING
It appears that a number of commodity markets are starting to at least price in some geopolitical risk around the growing tension between Russia an ...
Wednesday, 26 January 22
INDONESIA'S COAL BAN SENDS PRICES SOARING, OTHER EXPORTERS FAIL TO STEP UP - REUTERS
Indonesia’s short-lived ban on exporting coal has sent ructions through the seaborne market for the fuel in Asia, with the fallout likely to ...
|
|
|
Showing 366 to 370 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Indogreen Group - Indonesia
- Mercator Lines Limited - India
- Borneo Indobara - Indonesia
- Semirara Mining Corp, Philippines
- Holcim Trading Pte Ltd - Singapore
- Lanco Infratech Ltd - India
- South Luzon Thermal Energy Corporation
- VISA Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Therma Luzon, Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Essar Steel Hazira Ltd - India
- Sojitz Corporation - Japan
- PowerSource Philippines DevCo
- Kideco Jaya Agung - Indonesia
- Petron Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Miang Besar Coal Terminal - Indonesia
- Australian Coal Association
- Sakthi Sugars Limited - India
- Energy Link Ltd, New Zealand
- Larsen & Toubro Limited - India
- Energy Development Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Barasentosa Lestari - Indonesia
- Parliament of New Zealand
- Siam City Cement PLC, Thailand
- Parry Sugars Refinery, India
- Global Green Power PLC Corporation, Philippines
- Wilmar Investment Holdings
- Global Business Power Corporation, Philippines
- Commonwealth Bank - Australia
- Timah Investasi Mineral - Indoneisa
- Vedanta Resources Plc - India
- Interocean Group of Companies - India
- San Jose City I Power Corp, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Bukit Baiduri Energy - Indonesia
- GVK Power & Infra Limited - India
- Maheswari Brothers Coal Limited - India
- Binh Thuan Hamico - Vietnam
- MS Steel International - UAE
- Thiess Contractors Indonesia
- Leighton Contractors Pty Ltd - Australia
- Eastern Coal Council - USA
- Directorate Of Revenue Intelligence - India
- Alfred C Toepfer International GmbH - Germany
- Meenaskhi Energy Private Limited - India
- Grasim Industreis Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Sree Jayajothi Cements Limited - India
- Medco Energi Mining Internasional
- Karbindo Abesyapradhi - Indoneisa
- Agrawal Coal Company - India
- Edison Trading Spa - Italy
- Renaissance Capital - South Africa
- Bulk Trading Sa - Switzerland
- Mercuria Energy - Indonesia
- Posco Energy - South Korea
- Cement Manufacturers Association - India
- Billiton Holdings Pty Ltd - Australia
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Intertek Mineral Services - Indonesia
- Attock Cement Pakistan Limited
- Romanian Commodities Exchange
- Aditya Birla Group - India
- Georgia Ports Authority, United States
- Kalimantan Lumbung Energi - Indonesia
- IEA Clean Coal Centre - UK
- Indo Tambangraya Megah - Indonesia
- Indian Oil Corporation Limited
- Ministry of Transport, Egypt
- Coalindo Energy - Indonesia
- ASAPP Information Group - India
- SN Aboitiz Power Inc, Philippines
- Meralco Power Generation, Philippines
- Chamber of Mines of South Africa
- Gujarat Sidhee Cement - India
- Merrill Lynch Commodities Europe
- Eastern Energy - Thailand
- Coal and Oil Company - UAE
- Jorong Barutama Greston.PT - Indonesia
- Mintek Dendrill Indonesia
- White Energy Company Limited
- Bhoruka Overseas - Indonesia
- Marubeni Corporation - India
- Central Java Power - Indonesia
- Central Electricity Authority - India
- Gujarat Mineral Development Corp Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Madhucon Powers Ltd - India
- Rio Tinto Coal - Australia
- Economic Council, Georgia
- Oldendorff Carriers - Singapore
- SMG Consultants - Indonesia
- Electricity Authority, New Zealand
- Xindia Steels Limited - India
- SMC Global Power, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Ind-Barath Power Infra Limited - India
- Wood Mackenzie - Singapore
- Africa Commodities Group - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Deloitte Consulting - India
- Independent Power Producers Association of India
- Globalindo Alam Lestari - Indonesia
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Minerals Council of Australia
- Makarim & Taira - Indonesia
- Heidelberg Cement - Germany
- Bank of Tokyo Mitsubishi UFJ Ltd
- New Zealand Coal & Carbon
- LBH Netherlands Bv - Netherlands
- Videocon Industries ltd - India
- Samtan Co., Ltd - South Korea
- Semirara Mining and Power Corporation, Philippines
- Kumho Petrochemical, South Korea
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- Power Finance Corporation Ltd., India
- Formosa Plastics Group - Taiwan
- Jindal Steel & Power Ltd - India
- Price Waterhouse Coopers - Russia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- London Commodity Brokers - England
- Offshore Bulk Terminal Pte Ltd, Singapore
- Port Waratah Coal Services - Australia
- OPG Power Generation Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Bhushan Steel Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement - Thailand
- Coastal Gujarat Power Limited - India
- McConnell Dowell - Australia
- Vizag Seaport Private Limited - India
- Latin American Coal - Colombia
- CIMB Investment Bank - Malaysia
- The State Trading Corporation of India Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Banpu Public Company Limited - Thailand
- Riau Bara Harum - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Orica Australia Pty. Ltd.
- Global Coal Blending Company Limited - Australia
- Bharathi Cement Corporation - India
- Cigading International Bulk Terminal - Indonesia
- Baramulti Group, Indonesia
- Pendopo Energi Batubara - Indonesia
- Orica Mining Services - Indonesia
- Tata Chemicals Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Salva Resources Pvt Ltd - India
- Indonesian Coal Mining Association
- Sical Logistics Limited - India
- Simpson Spence & Young - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Indika Energy - Indonesia
- European Bulk Services B.V. - Netherlands
- Kartika Selabumi Mining - Indonesia
- Thai Mozambique Logistica
- Anglo American - United Kingdom
- Indian Energy Exchange, India
- CNBM International Corporation - China
- Altura Mining Limited, Indonesia
- Gujarat Electricity Regulatory Commission - India
- IHS Mccloskey Coal Group - USA
- Ministry of Mines - Canada
- Star Paper Mills Limited - India
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- PNOC Exploration Corporation - Philippines
- Singapore Mercantile Exchange
- Uttam Galva Steels Limited - India
- Tamil Nadu electricity Board
- Bayan Resources Tbk. - Indonesia
- Trasteel International SA, Italy
- Karaikal Port Pvt Ltd - India
- Dalmia Cement Bharat India
- Vijayanagar Sugar Pvt Ltd - India
- ICICI Bank Limited - India
- Mjunction Services Limited - India
- Metalloyd Limited - United Kingdom
- Bukit Makmur.PT - Indonesia
- Kepco SPC Power Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Aboitiz Power Corporation - Philippines
- Malabar Cements Ltd - India
- Straits Asia Resources Limited - Singapore
- Chettinad Cement Corporation Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- GMR Energy Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Ambuja Cements Ltd - India
- Ministry of Finance - Indonesia
- Jaiprakash Power Ventures ltd
- Manunggal Multi Energi - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Goldman Sachs - Singapore
- Electricity Generating Authority of Thailand
- The University of Queensland
- Australian Commodity Traders Exchange
- Planning Commission, India
- Bangladesh Power Developement Board
- Kobexindo Tractors - Indoneisa
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
- PTC India Limited - India
- TeaM Sual Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Standard Chartered Bank - UAE
|
| |
| |
|
