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Monday, 28 September 20
NEW LNG PROJECTS - ALL DRESSED UP AND NO PLACE TO GO - WOOD MACKENZIE
 It was meant to be another boom year. After a record 70 mmtpa of new LNG capacity was sanctioned in 2019, at least as much capacity was lined up for final approval this year and next. Instead of a feast of new projects, there’s a famine.
Developers, cash-strapped by the collapse in oil and gas prices, have pushed back on capital-intensive pre-FID LNG projects. Massimo Di-Odoardo, Global Head of Gas Analysis, identifies three other factors.
First, the outlook for LNG demand. We are bullish, anticipating LNG demand doubles over the next 20 years, driven by Asia’s economic growth and increasing penetration – particularly where policy supports gas over coal. Our view isn’t dissimilar to Shell’s that the LNG market grows at four times the rate of oil demand in that period.
Our base case forecasts global LNG demand grows by over 50% from 370 mmtpa in 2020 to 550 mmtpa by 2030. Allowing for projects already under development, there’s a supply gap of 102 mmtpa to be met by pre-FID projects which need to be onstream by the end of this decade.
But there are risks to our demand view. Gas demand has held up relatively well through the Covid-19 downturn, certainly compared with oil. The pace and shape of economic recovery though is far from clear and so, too, LNG demand growth in the next few years. Longer term, intensifying interest from policy makers and investors in new technologies, including green hydrogen and CCUS, casts doubt on the sustainability of demand growth.
Second, the rising influence of spot LNG prices on project economics. The traditional oil price-linked contracts and firm offtake agreements that have supported the financing of new projects are fading into history. Many projects today rely on equity lifting, with joint venture partners taking the LNG into their own portfolios. The attraction is flexible volumes that can be sold to any buyer and capture the best price.
But it also means rising exposure to spot LNG prices. Japan spot LNG prices have ranged from over US$11/mmbtu in 2018 to as low as US$2.10/mmbtu early this year, underlining the volatility and risk in running an open spot gas position.
Third, scrutiny of carbon intensity. ESG has leapt to the top of the agenda for LNG producers and buyers alike. LNG’s track record on emissions isn’t good. Inert gases including CO2 must be removed before liquefaction and typically are vented into the atmosphere. Liquefaction itself is energy intense, usually fuelled by produced gas.
In future, carbon footprint will be one factor determining how attractive an LNG project is to developers and buyers, and will influence the price it can command. New projects will have to be squeaky clean: developers will seek to electrify the liquefaction process (renewables where possible) and capture waste gases. Project economics will also be affected by carbon price assumptions.
Which pre-FID projects will fill the 102-mmtpa supply gap in 2030? First up are the mega-trains of Qatar’s low unit cost North Field East, which should be sanctioned in the coming months. This project on its own will absorb 32 mmtpa, negating the need for new supply from other sources until the late 2020s and pushing out FIDs for projects elsewhere by two to three years. Qatar believes it has another 16 mmtpa up its sleeve at North Field South that it could also develop.
So contestable demand for the rest is 70 mmtpa at best in 2030. A dozen or more projects from PNG, Australia, Mozambique, West Africa, Russia and North America, with combined capacity of more than 150 mmtpa, will be vying for their share.
The costs of integrated projects are discounted at 12%. Segmented projects – at 10% discount rate for LNG plant, 15% discount rate for upstream. Taxes are included. US Upstream assumption = 115% X Henry Hub (US$3.29/mmbtu – equivalent to average of long term H1 2020 Henry Hub forecast between 2026 and 2035) *The reference prices indicated by company logos indicate the long term prices used by companies for the purposes of valuing their assets. Assumed to be in Real terms (2020) from 2023.
How can prospective developers gain a better understanding to help support their big decisions? Wood Mackenzie’s new Global Gas Model Next Generation allows investors to analyse global gas market fundamentals and price formation; how LNG cash cost economics, coal-to-gas switching and shipping costs shape price differentials between the US, Europe and Asia markets; and how the cost stack for pre-FID projects evolves over time to meet any particular demand scenario. The model provides a framework to understand a project’s profitability under current market uncertainties.
We’ll be discussing LNG market dynamics, the investment outlook and lifecycle emissions for LNG projects at our Energy Summit (6 to 8 October 2020).
Source: Wood Mackenzie
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Wednesday, 12 June 24
CHINA ACCOUNTS FOR 16.3% OF AUSTRALIA'S COAL EXPORTS, FOLLOWED BY INDIA 14.4% - BANCHERO COSTA
Global coal trade has really picked up pace in recent months, and is now fully back to pre-Covid levels says Banchero Costa in its latest report.
...
Wednesday, 12 June 24
LNG NEWBUILDING VALUES AT RECORD HIGH: 78 NEWBUILD ORDERS PLACED IN 2024, DOUBLING 2023 - VESON NAUTICAL
The number of LNG newbuilding orders have more than doubled from the same period last year where 34 orders were placed, compared to 78 in the first ...
Monday, 10 June 24
CHINA'S MAY COAL IMPORTS RISE 11% ON LOWER DOMESTIC OUTPUT - REUTERS
China’s imports of coal rose 11% in May from a year earlier, customs data and Reuters records showed on Friday, as lower domestic output this ...
Tuesday, 04 June 24
HOW DO WESTERN SANCTIONS ON RUSSIA IMPACT THE GLOBAL METALS, MINING AND COAL MARKETS - WOOD MACKENZIE
The geopolitical landscape for Russia, as a major supplier of various commodities, has undergone a dramatic transformation since the invasion of Uk ...
Friday, 22 March 24
CASE STUDY: DANGERS OF COAL CARGO - SKULD
Recently, a bulk cargo vessel carrying coal from South Africa to Singapore suffered a fatal accident, resulting in the deaths of three crew members ...
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Showing 21 to 25 news of total 6871 |
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- Sinarmas Energy and Mining - Indonesia
- Thai Mozambique Logistica
- Karaikal Port Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Electricity Generating Authority of Thailand
- Indogreen Group - Indonesia
- Bharathi Cement Corporation - India
- Siam City Cement PLC, Thailand
- Siam City Cement - Thailand
- Goldman Sachs - Singapore
- Indika Energy - Indonesia
- Altura Mining Limited, Indonesia
- GAC Shipping (India) Pvt Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Therma Luzon, Inc, Philippines
- Wood Mackenzie - Singapore
- Central Electricity Authority - India
- TNB Fuel Sdn Bhd - Malaysia
- Chamber of Mines of South Africa
- AsiaOL BioFuels Corp., Philippines
- The University of Queensland
- Medco Energi Mining Internasional
- Xindia Steels Limited - India
- Vedanta Resources Plc - India
- Kohat Cement Company Ltd. - Pakistan
- Meenaskhi Energy Private Limited - India
- Coastal Gujarat Power Limited - India
- Aboitiz Power Corporation - Philippines
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Bukit Makmur.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- ASAPP Information Group - India
- Krishnapatnam Port Company Ltd. - India
- Port Waratah Coal Services - Australia
- TeaM Sual Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Interocean Group of Companies - India
- Indian Oil Corporation Limited
- Gujarat Sidhee Cement - India
- Kapuas Tunggal Persada - Indonesia
- Trasteel International SA, Italy
- Heidelberg Cement - Germany
- Straits Asia Resources Limited - Singapore
- Kumho Petrochemical, South Korea
- Vizag Seaport Private Limited - India
- Bayan Resources Tbk. - Indonesia
- Eastern Energy - Thailand
- European Bulk Services B.V. - Netherlands
- Energy Development Corp, Philippines
- Jindal Steel & Power Ltd - India
- Grasim Industreis Ltd - India
- Orica Mining Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- SMC Global Power, Philippines
- Salva Resources Pvt Ltd - India
- Madhucon Powers Ltd - India
- Carbofer General Trading SA - India
- Makarim & Taira - Indonesia
- Timah Investasi Mineral - Indoneisa
- Cement Manufacturers Association - India
- Vijayanagar Sugar Pvt Ltd - India
- Minerals Council of Australia
- Latin American Coal - Colombia
- Central Java Power - Indonesia
- Kartika Selabumi Mining - Indonesia
- Baramulti Group, Indonesia
- Metalloyd Limited - United Kingdom
- CNBM International Corporation - China
- Rio Tinto Coal - Australia
- Australian Coal Association
- Kaltim Prima Coal - Indonesia
- Manunggal Multi Energi - Indonesia
- Sical Logistics Limited - India
- Mintek Dendrill Indonesia
- Directorate Of Revenue Intelligence - India
- PowerSource Philippines DevCo
- South Luzon Thermal Energy Corporation
- IEA Clean Coal Centre - UK
- Africa Commodities Group - South Africa
- Bhushan Steel Limited - India
- Ministry of Finance - Indonesia
- Ministry of Mines - Canada
- PNOC Exploration Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- MS Steel International - UAE
- Agrawal Coal Company - India
- Kideco Jaya Agung - Indonesia
- Wilmar Investment Holdings
- San Jose City I Power Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Australian Commodity Traders Exchange
- Binh Thuan Hamico - Vietnam
- CIMB Investment Bank - Malaysia
- Merrill Lynch Commodities Europe
- PetroVietnam Power Coal Import and Supply Company
- Globalindo Alam Lestari - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Lanco Infratech Ltd - India
- The State Trading Corporation of India Ltd
- Aditya Birla Group - India
- Karbindo Abesyapradhi - Indoneisa
- New Zealand Coal & Carbon
- Eastern Coal Council - USA
- Orica Australia Pty. Ltd.
- Semirara Mining Corp, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indo Tambangraya Megah - Indonesia
- Samtan Co., Ltd - South Korea
- Iligan Light & Power Inc, Philippines
- Indonesian Coal Mining Association
- Renaissance Capital - South Africa
- Electricity Authority, New Zealand
- Mjunction Services Limited - India
- Dalmia Cement Bharat India
- Bulk Trading Sa - Switzerland
- Maheswari Brothers Coal Limited - India
- VISA Power Limited - India
- Directorate General of MIneral and Coal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Simpson Spence & Young - Indonesia
- Independent Power Producers Association of India
- Essar Steel Hazira Ltd - India
- Banpu Public Company Limited - Thailand
- GMR Energy Limited - India
- Star Paper Mills Limited - India
- Sojitz Corporation - Japan
- Sarangani Energy Corporation, Philippines
- Tamil Nadu electricity Board
- Global Coal Blending Company Limited - Australia
- GVK Power & Infra Limited - India
- Deloitte Consulting - India
- Petrochimia International Co. Ltd.- Taiwan
- Anglo American - United Kingdom
- Indian Energy Exchange, India
- Edison Trading Spa - Italy
- IHS Mccloskey Coal Group - USA
- SMG Consultants - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Georgia Ports Authority, United States
- ICICI Bank Limited - India
- Coal and Oil Company - UAE
- Jorong Barutama Greston.PT - Indonesia
- Parliament of New Zealand
- Larsen & Toubro Limited - India
- Malabar Cements Ltd - India
- Global Business Power Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Price Waterhouse Coopers - Russia
- Jaiprakash Power Ventures ltd
- Marubeni Corporation - India
- Borneo Indobara - Indonesia
- Thiess Contractors Indonesia
- Attock Cement Pakistan Limited
- Parry Sugars Refinery, India
- Sree Jayajothi Cements Limited - India
- Asmin Koalindo Tuhup - Indonesia
- SN Aboitiz Power Inc, Philippines
- Formosa Plastics Group - Taiwan
- Global Green Power PLC Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Riau Bara Harum - Indonesia
- Barasentosa Lestari - Indonesia
- Ministry of Transport, Egypt
- Videocon Industries ltd - India
- Rashtriya Ispat Nigam Limited - India
- Kepco SPC Power Corporation, Philippines
- Mercuria Energy - Indonesia
- Savvy Resources Ltd - HongKong
- Holcim Trading Pte Ltd - Singapore
- Meralco Power Generation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- Kalimantan Lumbung Energi - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Mercator Lines Limited - India
- Power Finance Corporation Ltd., India
- Standard Chartered Bank - UAE
- Miang Besar Coal Terminal - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- London Commodity Brokers - England
- Bhoruka Overseas - Indonesia
- Petron Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Energy Link Ltd, New Zealand
- Bangladesh Power Developement Board
- Posco Energy - South Korea
- Ambuja Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Uttam Galva Steels Limited - India
- Planning Commission, India
- Economic Council, Georgia
- Coalindo Energy - Indonesia
- India Bulls Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Tata Chemicals Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Romanian Commodities Exchange
- Commonwealth Bank - Australia
- White Energy Company Limited
- Kobexindo Tractors - Indoneisa
- The Treasury - Australian Government
- GN Power Mariveles Coal Plant, Philippines
- Antam Resourcindo - Indonesia
- Bhatia International Limited - India
- LBH Netherlands Bv - Netherlands
- McConnell Dowell - Australia
- OPG Power Generation Pvt Ltd - India
- PTC India Limited - India
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