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, 28 June 24
INDIAN POWER STATIONS STOCKED WITH BUMPER COAL SUPPLY AS TRANSPORT WOES EASE - BUSINESS STANDARD
Even as power demand has touched a historic high of 250 gigawatts (Gw) amid sweltering heat this June, India’s power stations are stocked wit ...
Friday, 28 June 24
INDIA'S CY23 COAL USE LARGER THAN NORTH AMERICA, EUROPE COMBINED - THE HINDU
For the first time, India’s coal consumption surpassed that of North America and Europe combined in the calendar year 2023, said Energy Insti ...
Monday, 24 June 24
PLN'S FINANCIAL SUSTAINABILITY RESTS ON ACCELERATED COAL RETIREMENT AND RENEWABLES DEPLOYMENT - MUTYA YUSTIKA
On 28 May 2024, Indonesia’s national electricity utility, PT Perusahaan Listrik Negara (PLN), released its financial report for 2023. Althoug ...
Monday, 24 June 24
INDIA'S COAL-BASED POWER DEMAND AT ALL-TIME HIGH, GOVERNMENT SAYS - REUTERS
India’s demand for coal-based power has risen by 7.3% this fiscal year to an all-time high, the government said in a statement on Wednesday.
...
Monday, 24 June 24
CHINA'S COAL INDUSTRY TURNS GREENER THROUGH INNOVATIVE APPROACHES - PEOPLE'S DAILY
At an opencast mine operated by Inner Mongolia Pingzhuang Coal Group Co. Ltd., a subsidiary of CHN Energy Investment Group (CHN Energy), a 14-meter ...
|
|
|
Showing 11 to 15 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Mercuria Energy - Indonesia
- Dalmia Cement Bharat India
- Sarangani Energy Corporation, Philippines
- Minerals Council of Australia
- Siam City Cement PLC, Thailand
- OPG Power Generation Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Global Coal Blending Company Limited - Australia
- Coal and Oil Company - UAE
- GN Power Mariveles Coal Plant, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Indian Oil Corporation Limited
- Leighton Contractors Pty Ltd - Australia
- Samtan Co., Ltd - South Korea
- New Zealand Coal & Carbon
- ASAPP Information Group - India
- AsiaOL BioFuels Corp., Philippines
- Central Java Power - Indonesia
- Holcim Trading Pte Ltd - Singapore
- The University of Queensland
- Jorong Barutama Greston.PT - Indonesia
- Toyota Tsusho Corporation, Japan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Business Power Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Attock Cement Pakistan Limited
- Antam Resourcindo - Indonesia
- Gujarat Sidhee Cement - India
- Rashtriya Ispat Nigam Limited - India
- Chettinad Cement Corporation Ltd - India
- Edison Trading Spa - Italy
- South Luzon Thermal Energy Corporation
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Planning Commission, India
- Agrawal Coal Company - India
- Anglo American - United Kingdom
- Bulk Trading Sa - Switzerland
- Mercator Lines Limited - India
- Energy Link Ltd, New Zealand
- Iligan Light & Power Inc, Philippines
- Manunggal Multi Energi - Indonesia
- SN Aboitiz Power Inc, Philippines
- Tamil Nadu electricity Board
- San Jose City I Power Corp, Philippines
- Salva Resources Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Larsen & Toubro Limited - India
- Coastal Gujarat Power Limited - India
- SMG Consultants - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Power Finance Corporation Ltd., India
- Mintek Dendrill Indonesia
- Mjunction Services Limited - India
- TeaM Sual Corporation - Philippines
- Aditya Birla Group - India
- Orica Mining Services - Indonesia
- Bukit Makmur.PT - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Kartika Selabumi Mining - Indonesia
- Kumho Petrochemical, South Korea
- Sree Jayajothi Cements Limited - India
- Price Waterhouse Coopers - Russia
- Bukit Asam (Persero) Tbk - Indonesia
- VISA Power Limited - India
- Billiton Holdings Pty Ltd - Australia
- The Treasury - Australian Government
- Riau Bara Harum - Indonesia
- Renaissance Capital - South Africa
- Sinarmas Energy and Mining - Indonesia
- Directorate Of Revenue Intelligence - India
- European Bulk Services B.V. - Netherlands
- Electricity Generating Authority of Thailand
- IEA Clean Coal Centre - UK
- Singapore Mercantile Exchange
- Krishnapatnam Port Company Ltd. - India
- Australian Commodity Traders Exchange
- Energy Development Corp, Philippines
- Port Waratah Coal Services - Australia
- Merrill Lynch Commodities Europe
- IHS Mccloskey Coal Group - USA
- Indika Energy - Indonesia
- GMR Energy Limited - India
- Romanian Commodities Exchange
- PTC India Limited - India
- Makarim & Taira - Indonesia
- Bhatia International Limited - India
- Standard Chartered Bank - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Heidelberg Cement - Germany
- Africa Commodities Group - South Africa
- Electricity Authority, New Zealand
- Kapuas Tunggal Persada - Indonesia
- Orica Australia Pty. Ltd.
- Sojitz Corporation - Japan
- Ministry of Finance - Indonesia
- Indian Energy Exchange, India
- McConnell Dowell - Australia
- Baramulti Group, Indonesia
- Goldman Sachs - Singapore
- Latin American Coal - Colombia
- Wilmar Investment Holdings
- Kaltim Prima Coal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Interocean Group of Companies - India
- Straits Asia Resources Limited - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Pendopo Energi Batubara - Indonesia
- Indo Tambangraya Megah - Indonesia
- CIMB Investment Bank - Malaysia
- Madhucon Powers Ltd - India
- Intertek Mineral Services - Indonesia
- The State Trading Corporation of India Ltd
- Uttam Galva Steels Limited - India
- Essar Steel Hazira Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Karbindo Abesyapradhi - Indoneisa
- Sindya Power Generating Company Private Ltd
- Borneo Indobara - Indonesia
- Central Electricity Authority - India
- PNOC Exploration Corporation - Philippines
- Barasentosa Lestari - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ceylon Electricity Board - Sri Lanka
- Meralco Power Generation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Binh Thuan Hamico - Vietnam
- Therma Luzon, Inc, Philippines
- Savvy Resources Ltd - HongKong
- Australian Coal Association
- Carbofer General Trading SA - India
- Parry Sugars Refinery, India
- Cigading International Bulk Terminal - Indonesia
- Indonesian Coal Mining Association
- PetroVietnam Power Coal Import and Supply Company
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- India Bulls Power Limited - India
- Ministry of Transport, Egypt
- Vedanta Resources Plc - India
- GVK Power & Infra Limited - India
- Simpson Spence & Young - Indonesia
- Thiess Contractors Indonesia
- Videocon Industries ltd - India
- Sical Logistics Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Vizag Seaport Private Limited - India
- Rio Tinto Coal - Australia
- Chamber of Mines of South Africa
- Alfred C Toepfer International GmbH - Germany
- Eastern Coal Council - USA
- White Energy Company Limited
- Bharathi Cement Corporation - India
- Metalloyd Limited - United Kingdom
- Pipit Mutiara Jaya. PT, Indonesia
- Indogreen Group - Indonesia
- Altura Mining Limited, Indonesia
- Timah Investasi Mineral - Indoneisa
- Medco Energi Mining Internasional
- Xindia Steels Limited - India
- Petron Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Maheswari Brothers Coal Limited - India
- International Coal Ventures Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Thai Mozambique Logistica
- Grasim Industreis Ltd - India
- Posco Energy - South Korea
- Semirara Mining Corp, Philippines
- Star Paper Mills Limited - India
- Marubeni Corporation - India
- Karaikal Port Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Parliament of New Zealand
- Georgia Ports Authority, United States
- Ambuja Cements Ltd - India
- Wood Mackenzie - Singapore
- MS Steel International - UAE
- Jaiprakash Power Ventures ltd
- Asmin Koalindo Tuhup - Indonesia
- CNBM International Corporation - China
- SMC Global Power, Philippines
- Commonwealth Bank - Australia
- Economic Council, Georgia
- Bukit Baiduri Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Eastern Energy - Thailand
- Cement Manufacturers Association - India
- Lanco Infratech Ltd - India
- Sakthi Sugars Limited - India
- Bayan Resources Tbk. - Indonesia
- Siam City Cement - Thailand
- ICICI Bank Limited - India
- Independent Power Producers Association of India
- Kideco Jaya Agung - Indonesia
- Malabar Cements Ltd - India
- Tata Chemicals Ltd - India
- Trasteel International SA, Italy
- Oldendorff Carriers - Singapore
- Miang Besar Coal Terminal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Coalindo Energy - Indonesia
- Deloitte Consulting - India
- Bangladesh Power Developement Board
- Formosa Plastics Group - Taiwan
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- Bhushan Steel Limited - India
- Banpu Public Company Limited - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kobexindo Tractors - Indoneisa
- PowerSource Philippines DevCo
- London Commodity Brokers - England
- Kepco SPC Power Corporation, Philippines
- Ministry of Mines - Canada
|
| |
| |
|
