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.
|
|
Monday, 24 August 20
A COMBINATION OF DEVELOPMENTS DROVE THE FALLOFF COAL PRICES - CHIEF ECONOMIST’ OFFICE, AUSTRALIA
China, rising domestic production combined with subdued power demand;
India, a lockdown coupled with government directives that fav ...
Monday, 24 August 20
AUSTRALIA'S THERMAL COAL EXPORTS ARE FORECAST TO DROP FROM AN ESTIMATED $20 BILLION IN 2019-20 TO $16 BILLION IN 2020-21: REPORT
Thermal coal spot prices have fallen sharply as the impact of COVID-19 drives a contraction in seaborne trade for only the second time this century ...
Saturday, 22 August 20
REPORT SEES INDIA’S RELIANCE ON THERMAL POWER DROPPING TO 50% IN 2021, 43% IN 2026 - ET ENERGY | IEEFA
India’s dependence on thermal power will reduce to 50 per cent by 2021-22 and 43 per cent by 2026-27 on the back of renewable energy (RE) cap ...
Friday, 21 August 20
323 MILLION ELECTRIC VEHICLES WILL BE ON THE ROADS BY 2040 - WOOD MACKENZIE
Electric vehicle (EV) sales are expected to reach 45 million units per year by 2040, with a total global EV stock of 323 million, according to new ...
Friday, 21 August 20
BHP COMMITS TO SELLING ITS THERMAL COALMINES WITHIN TWO YEARS - THE GUARDIAN
Move follows pressure from investors but company stops short of full exit from coalmining
BHP has announced it plans to sell off its ...
|
|
|
Showing 816 to 820 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- South Luzon Thermal Energy Corporation
- VISA Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Aditya Birla Group - India
- Kaltim Prima Coal - Indonesia
- GMR Energy Limited - India
- Mintek Dendrill Indonesia
- Orica Australia Pty. Ltd.
- Bahari Cakrawala Sebuku - Indonesia
- Australian Coal Association
- Thai Mozambique Logistica
- Bukit Makmur.PT - Indonesia
- Singapore Mercantile Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Attock Cement Pakistan Limited
- GAC Shipping (India) Pvt Ltd
- European Bulk Services B.V. - Netherlands
- Edison Trading Spa - Italy
- Malabar Cements Ltd - India
- Carbofer General Trading SA - India
- Coalindo Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Madhucon Powers Ltd - India
- Power Finance Corporation Ltd., India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Electricity Authority, New Zealand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Salva Resources Pvt Ltd - India
- Agrawal Coal Company - India
- London Commodity Brokers - England
- Interocean Group of Companies - India
- Jorong Barutama Greston.PT - Indonesia
- The Treasury - Australian Government
- Meenaskhi Energy Private Limited - India
- Romanian Commodities Exchange
- Electricity Generating Authority of Thailand
- Goldman Sachs - Singapore
- Chamber of Mines of South Africa
- OPG Power Generation Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- Krishnapatnam Port Company Ltd. - India
- Dalmia Cement Bharat India
- Lanco Infratech Ltd - India
- Cement Manufacturers Association - India
- IEA Clean Coal Centre - UK
- SMC Global Power, Philippines
- Mjunction Services Limited - India
- Antam Resourcindo - Indonesia
- Kepco SPC Power Corporation, Philippines
- PowerSource Philippines DevCo
- Billiton Holdings Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Savvy Resources Ltd - HongKong
- GN Power Mariveles Coal Plant, Philippines
- Marubeni Corporation - India
- Medco Energi Mining Internasional
- ICICI Bank Limited - India
- Banpu Public Company Limited - Thailand
- Barasentosa Lestari - Indonesia
- Mercator Lines Limited - India
- Eastern Energy - Thailand
- Price Waterhouse Coopers - Russia
- Indian Energy Exchange, India
- Merrill Lynch Commodities Europe
- Semirara Mining and Power Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Riau Bara Harum - Indonesia
- Oldendorff Carriers - Singapore
- Sakthi Sugars Limited - India
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- SN Aboitiz Power Inc, Philippines
- New Zealand Coal & Carbon
- Renaissance Capital - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Economic Council, Georgia
- Vijayanagar Sugar Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Global Business Power Corporation, Philippines
- Xindia Steels Limited - India
- TeaM Sual Corporation - Philippines
- Energy Link Ltd, New Zealand
- Directorate Of Revenue Intelligence - India
- Heidelberg Cement - Germany
- Grasim Industreis Ltd - India
- Jaiprakash Power Ventures ltd
- Kalimantan Lumbung Energi - Indonesia
- Coastal Gujarat Power Limited - India
- Kumho Petrochemical, South Korea
- Minerals Council of Australia
- Planning Commission, India
- Commonwealth Bank - Australia
- The State Trading Corporation of India Ltd
- Ambuja Cements Ltd - India
- Parliament of New Zealand
- Central Electricity Authority - India
- Aboitiz Power Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Kobexindo Tractors - Indoneisa
- Globalindo Alam Lestari - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Africa Commodities Group - South Africa
- Pendopo Energi Batubara - Indonesia
- Bhushan Steel Limited - India
- Standard Chartered Bank - UAE
- Manunggal Multi Energi - Indonesia
- Vedanta Resources Plc - India
- Simpson Spence & Young - Indonesia
- Bhoruka Overseas - Indonesia
- Eastern Coal Council - USA
- Wood Mackenzie - Singapore
- Indonesian Coal Mining Association
- Videocon Industries ltd - India
- Therma Luzon, Inc, Philippines
- LBH Netherlands Bv - Netherlands
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Baramulti Group, Indonesia
- Energy Development Corp, Philippines
- Maheswari Brothers Coal Limited - India
- Leighton Contractors Pty Ltd - Australia
- Rio Tinto Coal - Australia
- Gujarat Sidhee Cement - India
- Petrochimia International Co. Ltd.- Taiwan
- Straits Asia Resources Limited - Singapore
- GVK Power & Infra Limited - India
- Timah Investasi Mineral - Indoneisa
- Iligan Light & Power Inc, Philippines
- Indogreen Group - Indonesia
- Essar Steel Hazira Ltd - India
- Sojitz Corporation - Japan
- Bharathi Cement Corporation - India
- Star Paper Mills Limited - India
- Posco Energy - South Korea
- PNOC Exploration Corporation - Philippines
- Bayan Resources Tbk. - Indonesia
- Vizag Seaport Private Limited - India
- Cigading International Bulk Terminal - Indonesia
- Port Waratah Coal Services - Australia
- San Jose City I Power Corp, Philippines
- CNBM International Corporation - China
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Bhatia International Limited - India
- Independent Power Producers Association of India
- Samtan Co., Ltd - South Korea
- Ceylon Electricity Board - Sri Lanka
- Larsen & Toubro Limited - India
- Mercuria Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Australian Commodity Traders Exchange
- Indika Energy - Indonesia
- PTC India Limited - India
- Formosa Plastics Group - Taiwan
- Orica Mining Services - Indonesia
- India Bulls Power Limited - India
- Binh Thuan Hamico - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- Kideco Jaya Agung - Indonesia
- Tata Chemicals Ltd - India
- Semirara Mining Corp, Philippines
- White Energy Company Limited
- Coal and Oil Company - UAE
- McConnell Dowell - Australia
- Rashtriya Ispat Nigam Limited - India
- Global Green Power PLC Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Parry Sugars Refinery, India
- Neyveli Lignite Corporation Ltd, - India
- Borneo Indobara - Indonesia
- SMG Consultants - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- IHS Mccloskey Coal Group - USA
- Meralco Power Generation, Philippines
- Indo Tambangraya Megah - Indonesia
- Wilmar Investment Holdings
- Ind-Barath Power Infra Limited - India
- Ministry of Transport, Egypt
- Petron Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Toyota Tsusho Corporation, Japan
- Global Coal Blending Company Limited - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Sical Logistics Limited - India
- Ministry of Finance - Indonesia
- Georgia Ports Authority, United States
- Holcim Trading Pte Ltd - Singapore
- Central Java Power - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Deloitte Consulting - India
- ASAPP Information Group - India
- Ministry of Mines - Canada
- Bukit Baiduri Energy - Indonesia
- Sindya Power Generating Company Private Ltd
- Sree Jayajothi Cements Limited - India
- Indian Oil Corporation Limited
- Bangladesh Power Developement Board
- Siam City Cement - Thailand
- Makarim & Taira - Indonesia
- Trasteel International SA, Italy
- Asmin Koalindo Tuhup - Indonesia
- Altura Mining Limited, Indonesia
- Uttam Galva Steels Limited - India
- Anglo American - United Kingdom
- Kartika Selabumi Mining - Indonesia
- The University of Queensland
- Thiess Contractors Indonesia
- Latin American Coal - Colombia
- Bulk Trading Sa - Switzerland
- Karaikal Port Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- CIMB Investment Bank - Malaysia
|
| |
| |
|
