We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Thursday, 30 June 22
WHY ARE LNG SHIPPING STOCKS RESILIENT? - DREWRY
LNG shipping stocks are proving resilient despite uncertainties about growth in global GDP, high inflation and the ongoing geopolitical crisis caused by the Russia-Ukraine conflict. Drewry’s LNG shipping equity index increased by 12.7% YTD as of 28 June 2022, outperforming S&P 500 which declined by 19.8% during the same period. Golar LNG stock price surged the most (up 87.9%), while Flex LNG increased by 24.8% and Nakilat by +18.2.%. LNG stocks have mainly benefited from the rising European LNG demand as the region switches away from Russian natural gas. We explore the reasons for the resilience of LNG shipping stocks amid the sell-off in the broader equity market and whether investors should consider adding LNG stocks to their portfolios.
FSRU focused stocks are key beneficiaries
Companies with FSRU exposure have particularly benefited as European countries are opting for FSRUs over their land-based counterparts. FSRU terminals can be installed in one-two years compared to three years for LNG import terminals. Golar LNG’s share price has profited from its exposure to FSRU, the company’s stake in New Fortress Energy (NFE – a leading FSRU player) and high crude oil prices. Amid a buoyant FSRU market, Golar LNG has entered into a contract with Snam to sell its 19-year-old LNG vessel Golar Arctic for USD 287.9mn (EUR 269mn) as an FSRU after conversion. The company has also signed an agreement with Snam to sell Golar Tundra FSRU for USD 350mn. NFE, which has a fleet of seven FSRUs and in which Golar LNG has a stake of 6%, has gained 68.5% YTD.
FSRUs are in high demand with Europe seeking at least 16 FSRUs to replace most of the Russian gas imports. We believe countries like Germany, France and Italy are willing to pay a high premium to acquire the assets, but with only 50 FSRUs (as of March 2022) in operation globally, the demand for FSRU providers has strengthened.
Buoyant market drives new charter wins
The upcoming EEXI and CII regulations and charters’ desire to secure LNG ships amid the geopolitical tensions are other factors driving LNG shipping demand. Flex LNG has won fixed charter for 12 vessels since March 2021, suggesting strong demand for its young fleet, with three of these charter wins in June 2022. Latest charter wins announced in June 2022 extend between seven and ten years, longer than most of the company’s existing charters and suggest increasing preference of charterers to go for longer term charter. Nakilat announced during its 4Q21 results that it has won the term-charter for all the four newbuild vessels delivered between 2Q20 and 1Q22.
LNG shipping prospects
The Russia-Ukraine war has brought the energy sector to the center stage with more focus on the LNG industry as Europe tries to wean away from Russian LNG imports and is ramping up its LNG import facilities by investing in FSRUs. As the coming years should see more FID for LNG liquefaction projects, leading to higher demand for LNG ships, we expect spot and long-term LNG shipping rates to firm up. LNG shipping companies stand to benefit from this high charter rate environment. Expectations of tight LNG supply and European geopolitical tensions is accelerating sale and purchase agreements for LNG and in turn, FIDs for new LNG projects. Charterers are preferring long-term charter to cover volatility in a tight supply market. While new order momentum is high in 2022 YTD with close to 100 LNG ship orders, we expect LNG shipping rates to continue to rise as most of the new orders have firm charter.
Upcoming EEXI and CII regulations to support LNG freight rates
As EEXI and CII regulations come into effect from 1 January 2023, we expect an increase in conversion activity of older stream turbine vessels into FSU for import projects as we believe these vessels will be more impacted by the new regulations. While these vessels will need to reduce their speed to comply with the regulations, the very old vessels will become unviable and will exit the fleet, affecting capacity and consequently supporting higher freight rates.
More borrowing capacity with a healthier balance sheet
LNG shipping companies have a healthier balance sheet at the end of 1Q22 compared to 4Q20. Furthermore, an increase in LNG vessel prices since mid-2020 indicates higher borrowings potential which can be used to acquire new vessels. Given the strong prospects, it is comparatively easier now to win a long-term charter compared to the previous two years.
Conclusion
We expect earnings of LNG shipping companies to benefit from positive LNG shipping prospects in the coming quarters. Given the tight LNG shipping prospects and LNG stocks’ resilience thus far, we believe investors can consider adding LNG shipping stocks to their portfolio. We prefer companies with solid revenues, young fleet and healthy balance sheet.
Source: Drewry
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Monday, 04 July 22
INDONESIAN COAL PRICE REFERENCE SLIGHTLY DOWN IN JULY
COALspot.com: Indonesian Coal Price Reference for July delivery drops 1.52 per cent month on month.
The Indonesian Coal Price Refere ...
Sunday, 03 July 22
CHINESE VICE PREMIER STRESSES CLEAN, EFFICIENT USE OF COAL - XINHUA
Chinese Vice Premier Han Zheng has stressed efforts to promote the clean and efficient use of coal, and pursue green, low-carbon and high-quality d ...
Sunday, 03 July 22
SOVEREIGN SECTOR OUTLOOK REVISED TO NEUTRAL ON UKRAINE WAR IMPACT - FITCH RATINGS
The deterioration in global sovereign credit conditions this year relative to our expectations at end-2021 has caused Fitch Ratings to change its g ...
Saturday, 02 July 22
GLOBAL SEABORNE COAL EXPORTS IN 2021 INCREASED BY 4.4% Y-O-Y TO 1147 MLN TONNES - BANCHERO COSTA
In the full 12 months of 2021, global seaborne coal exports increased by +4.4% y-o-y to 1147 mln tonnes, from 1099 mln tonnes in 2020, according to ...
Friday, 01 July 22
INDIA'S TOP CEMENT MAKER PAYING FOR RUSSIAN COAL IN CHINESE YUAN - REUTERS
India’s biggest cement producer, UltraTech Cement ULTC.NS, is importing a cargo of Russian coal and paying using Chinese yuan, according to a ...
|
|
|
Showing 306 to 310 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Binh Thuan Hamico - Vietnam
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- GAC Shipping (India) Pvt Ltd
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- Semirara Mining and Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Iligan Light & Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- New Zealand Coal & Carbon
- Parliament of New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Marubeni Corporation - India
- Kumho Petrochemical, South Korea
- LBH Netherlands Bv - Netherlands
- Larsen & Toubro Limited - India
- Mintek Dendrill Indonesia
- Minerals Council of Australia
- Bangladesh Power Developement Board
- Directorate Of Revenue Intelligence - India
- Malabar Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- Metalloyd Limited - United Kingdom
- Jindal Steel & Power Ltd - India
- Meralco Power Generation, Philippines
- Madhucon Powers Ltd - India
- SN Aboitiz Power Inc, Philippines
- Siam City Cement - Thailand
- Asmin Koalindo Tuhup - Indonesia
- Therma Luzon, Inc, Philippines
- Karaikal Port Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Antam Resourcindo - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Indika Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Bulk Trading Sa - Switzerland
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- ICICI Bank Limited - India
- Uttam Galva Steels Limited - India
- Carbofer General Trading SA - India
- Tata Chemicals Ltd - India
- Global Coal Blending Company Limited - Australia
- AsiaOL BioFuels Corp., Philippines
- Xindia Steels Limited - India
- Eastern Energy - Thailand
- Vedanta Resources Plc - India
- Orica Australia Pty. Ltd.
- Bhatia International Limited - India
- Formosa Plastics Group - Taiwan
- PetroVietnam Power Coal Import and Supply Company
- Mjunction Services Limited - India
- McConnell Dowell - Australia
- Africa Commodities Group - South Africa
- TeaM Sual Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Samtan Co., Ltd - South Korea
- Ceylon Electricity Board - Sri Lanka
- Globalindo Alam Lestari - Indonesia
- Star Paper Mills Limited - India
- Essar Steel Hazira Ltd - India
- Petron Corporation, Philippines
- GMR Energy Limited - India
- Indonesian Coal Mining Association
- Altura Mining Limited, Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Renaissance Capital - South Africa
- ASAPP Information Group - India
- Indian Energy Exchange, India
- Tamil Nadu electricity Board
- Thiess Contractors Indonesia
- Chettinad Cement Corporation Ltd - India
- Port Waratah Coal Services - Australia
- Kohat Cement Company Ltd. - Pakistan
- Coastal Gujarat Power Limited - India
- IHS Mccloskey Coal Group - USA
- GVK Power & Infra Limited - India
- India Bulls Power Limited - India
- Manunggal Multi Energi - Indonesia
- Attock Cement Pakistan Limited
- Krishnapatnam Port Company Ltd. - India
- Ministry of Finance - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Salva Resources Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Commonwealth Bank - Australia
- The State Trading Corporation of India Ltd
- Savvy Resources Ltd - HongKong
- Kapuas Tunggal Persada - Indonesia
- Parry Sugars Refinery, India
- Sree Jayajothi Cements Limited - India
- Central Java Power - Indonesia
- Cement Manufacturers Association - India
- Mercator Lines Limited - India
- Lanco Infratech Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GN Power Mariveles Coal Plant, Philippines
- San Jose City I Power Corp, Philippines
- IEA Clean Coal Centre - UK
- Ambuja Cements Ltd - India
- Deloitte Consulting - India
- Indian Oil Corporation Limited
- CIMB Investment Bank - Malaysia
- Singapore Mercantile Exchange
- Wood Mackenzie - Singapore
- The University of Queensland
- Global Green Power PLC Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Bharathi Cement Corporation - India
- Coalindo Energy - Indonesia
- Eastern Coal Council - USA
- Sojitz Corporation - Japan
- Videocon Industries ltd - India
- Edison Trading Spa - Italy
- European Bulk Services B.V. - Netherlands
- Medco Energi Mining Internasional
- Australian Commodity Traders Exchange
- Riau Bara Harum - Indonesia
- White Energy Company Limited
- London Commodity Brokers - England
- The Treasury - Australian Government
- Kartika Selabumi Mining - Indonesia
- Standard Chartered Bank - UAE
- Trasteel International SA, Italy
- Ministry of Mines - Canada
- PowerSource Philippines DevCo
- SMC Global Power, Philippines
- Heidelberg Cement - Germany
- Maharashtra Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Sakthi Sugars Limited - India
- Rashtriya Ispat Nigam Limited - India
- Planning Commission, India
- Sinarmas Energy and Mining - Indonesia
- Goldman Sachs - Singapore
- Central Electricity Authority - India
- Kobexindo Tractors - Indoneisa
- Economic Council, Georgia
- Borneo Indobara - Indonesia
- Posco Energy - South Korea
- Gujarat Sidhee Cement - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Mercuria Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Power Finance Corporation Ltd., India
- Billiton Holdings Pty Ltd - Australia
- Ind-Barath Power Infra Limited - India
- Wilmar Investment Holdings
- Bhoruka Overseas - Indonesia
- Jaiprakash Power Ventures ltd
- PTC India Limited - India
- Rio Tinto Coal - Australia
- Kepco SPC Power Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Thai Mozambique Logistica
- Intertek Mineral Services - Indonesia
- Chamber of Mines of South Africa
- Orica Mining Services - Indonesia
- Straits Asia Resources Limited - Singapore
- Maheswari Brothers Coal Limited - India
- Baramulti Group, Indonesia
- Australian Coal Association
- CNBM International Corporation - China
- Alfred C Toepfer International GmbH - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- Anglo American - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- Bhushan Steel Limited - India
- Global Business Power Corporation, Philippines
- Romanian Commodities Exchange
- Indo Tambangraya Megah - Indonesia
- OPG Power Generation Pvt Ltd - India
- Dalmia Cement Bharat India
- Electricity Authority, New Zealand
- Aditya Birla Group - India
- Simpson Spence & Young - Indonesia
- Energy Development Corp, Philippines
- Agrawal Coal Company - India
- Bukit Baiduri Energy - Indonesia
- Makarim & Taira - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Banpu Public Company Limited - Thailand
- Georgia Ports Authority, United States
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Grasim Industreis Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Bukit Makmur.PT - Indonesia
- Coal and Oil Company - UAE
- Sindya Power Generating Company Private Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- South Luzon Thermal Energy Corporation
- Barasentosa Lestari - Indonesia
- Interocean Group of Companies - India
- Oldendorff Carriers - Singapore
- Ministry of Transport, Egypt
- Indogreen Group - Indonesia
- VISA Power Limited - India
- PNOC Exploration Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- Electricity Generating Authority of Thailand
- MS Steel International - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Bayan Resources Tbk. - Indonesia
- Energy Link Ltd, New Zealand
- Merrill Lynch Commodities Europe
- SMG Consultants - Indonesia
|
| |
| |
|
