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[la forge] 05/4/2018 17:43

L.V. published on 05/04/2018 at 17h52
GTT: two new orders from DSME
Photo credit © GTT

(Boursier.com) - GTT announces having received at the end of March, an order from the South Korean shipyard Daewoo Shipbuilding & Marine Engineering (DSME), for the design of the LNG tanks of two LNG carriers.

These two units, with a capacity of 173,400 m3, will be built on the DSME shipyard in Geoje, Korea, on behalf of a European shipowner. They will be equipped with tanks incorporating NO96 GW technology.

Their respective deliveries will take place in late 2019 and early 2020.

[sarkasm] 05/4/2018 10:01

LNG lorry hits streets with infrastructure backing

05 April 2018

Volvo Trucks has begun shipping its new gas-powered truck to the UK, with Volvo choosing Calor’s liquefied natural gas (LNG) facility at Donington Park Services for its first UK fill.
[calor]

Located off the M1 motorway at Junction 23a, the publicly-accessible LNG refuelling station is one of seven available from Calor in the UK. This network is set to play a role in supporting the growth of sustainable transports, such as Volvo Truck’s new gas-powered vehicle.

The new Volvo FM LNG is a gas-powered truck with a powertrain based on Volvo’s diesel engine technology. With the 460hp engine running on LNG, it is capable of delivering 20 per cent less CO2 than a regular Volvo FM truck.

A fuel choice steadily growing in demand for companies operating long-haul heavy goods vehicles (HGVs), LNG offers significantly less CO2 emissions than conventional fuels such as diesel, while dramatically reducing dangerous particulates like NOx and SOx.

A colourless, odourless liquid fuel, LNG is created by cooling natural gas to a temperature of around -162°C. When cooled to this temperature, the gas liquefies and reduces in volume too. This quality ensures LNG is easy to store, and makes it ideally suited to fuel regional and long-haul HGVs.

[grupo guitarlumber] 30/3/2018 08:58

30/03/2018 8:02am
Dow Jones News

Shell A (LSE:RDSA)
Intraday Stock Chart

Today : Friday 30 March 2018
Click Here for more Shell A Charts.

Its recent deals are part of a long-term strategy for its huge natural-gas output

By Sarah Kent

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (March 30, 2018).

LONDON -- Royal Dutch Shell PLC is on a spree of small but strategic acquisitions in an area oil companies have long avoided: the power sector.

In the past few months, the British-Dutch oil giant bought a utility, an electric-car charging business and a stake in a solar-power company, part of a broader long-term plan to marry its huge natural-gas output with a futuristic utility business.

Shell is making a bet it can profit from changes to the power market as renewables begin to play a bigger role, combining its large energy-trading division and massive natural-gas supply -- the world's largest from a non-state-backed company -- to fill gaps when the sun doesn't shine or wind doesn't blow. Eventually, Shell said it could even compete with tech companies, crunching data about how and when customers use electricity to give them a better deal.

If all goes to plan over several decades, Shell said it would produce gas at the well, use it to produce electricity and then sell power to homes, businesses and electric-vehicle charging stations -- a similar model to its oil-rig-to-gas-station petroleum business.

It "makes us future proof in a world where electricity becomes the biggest game in town," said Maarten Wetselaar, Shell's head of gas and new energies in a recent interview.

Shell last month bought a midsize U.K. power supplier, First Utility, for an undisclosed amount, giving it direct access to retail electricity consumers for the first time. Last year, the company bought one of Europe's biggest electric-vehicle charging companies, New Motion, also for an undisclosed sum.

The company is in a partnership with Ionity -- a joint venture of large car manufacturers established to create a network of fast-charging points across Europe. In January, Shell announced plans to acquire a nearly 44% stake in U.S. solar company Silicon Ranch Corporation in a deal valued around $200 million.

Shell has said it plans to spend between $1 billion and $2 billion a year in what it calls its "New Energies" division through 2020 -- more than many other large oil companies are setting aside for renewables and electricity generation. The company is building wind farms off Europe's coast and has said future investments could also include gas-fired power plants.

The moves reflect Shell's need to find an outlet for its prodigious natural gas output, which grew with the company's roughly $50 billion acquisition of BG Group in 2016.

They also show how Shell and other large oil companies are anticipating shifts in how people consume energy, as many governments try to reduce fossil-fuel consumption under the 2015 United Nations' Paris agreement to fight climate change. Whether oil demand will level off in the coming decades is up for debate, while electricity consumption is widely expected to increase.

By 2050, power consumption is expected to outstrip demand for Shell's core business of oil and gas, said Mr. Wetselaar. The company's most recent of several potential scenarios, published Monday, foresees a world in which demand for oil and gas peaks in the next 50 years, driven by successful efforts to meet global climate goals. Reliance on electricity, by contrast, is expected grow from around 20% of energy consumption to closer to 50% by midcentury.

"To be an energy major by then, we'd better play in that sector," Mr. Wetselaar said of electricity.

Total SA -- another early mover on electricity -- is looking to build a retail power business in France. The French company also said it would consider investments in gas-fired power stations around the world to lock in a market for its growing gas production and has bought a battery company. British rival BP PLC has also said it would consider investments in gas power plants, though it has held back from setting ambitions to compete as a utility.

The challenge is selling electricity profitably. The oil industry has already lost billions of dollars in previous efforts to move into renewables. Shell made early and unprofitable moves into offshore wind and solar that prompted a yearslong retreat from those sectors. Meanwhile, oil companies have tended to avoid the highly regulated, localized and lower-return business of producing and selling electricity.

"The clean energy sector is a very difficult subject for the majors," said Valentina Kretzschmar, a director at Edinburgh-based consultancy Wood Mackenzie. "Anything on the renewables side -- including power -- has much more inferior returns on investment than what the companies can get from their oil and gas projects."

Shell is proceeding with caution, putting a fraction of its $25 billion to $30 billion capital spending budget into its new energies business. It will remain an oil-and-gas producer first for decades.

Shell's acquisition of First Utility gives it a customer base of 825,000 homes across the U.K. and Germany. Meanwhile, New Motion gives it more than 30,000 private home electric-vehicle charging points and over 50,000 public sites across Europe. Together with Ionity, Shell plans to install 500 high-speed charging points across 10 European countries in the next two years.

It is a long-term bet that the number of electric vehicles on the road will rise in Europe, encouraged by moves in France, the U.K. and others to eventually ban the combustion engine.

"There's a tipping point that's not that far out," Mr. Wetselaar said.

Write to Sarah Kent at [e-mail]



(END) Dow Jones Newswires

March 30, 2018 02:47 ET (06:47 GMT)

[sarkasm] 29/3/2018 10:07

Natural Gas
March 29, 2018 08:20 UTC (0) (0)
Are spot LNG prices headed up or down? Take a look at JKM Swaps

Trading volatility has been the defining hallmark of the Asian peak season winter market. But this past winter, Asia has seen the emergence of a nascent but increasingly liquid derivative market to not only trade and manage that volatility but also to shed some light into forward expectations.

Liquidity in the Platts Japan Korea Marker Swaps or JKM Swaps product has shown explosive growth in volume since late-2016. In 2017, JKM exchange-cleared derivatives surpassed 9.6 million mt, nearly quadruple of 2016 volumes.

The recent winter of 2017/18 has been particularly volatile, with the physical JKM spot LNG assessment not only charting the longest rally since its inception in 2009 but also briefly returning to double-digit levels not seen in three years.

The recent winter saw collective total imports for Japan, China, South Korea and Taiwan over December to February reached 53.2 million mt, up 10.7% compared to the previous winter season. Chinese imports rocketed 53.4% compared to last winter, buying nearly 4.8 million mt more, to reach 13.7 million mt in total — and seizing the title of world’s second largest importer from South Korea. In comparison, Japan saw winter imports rise 0.3 million mt or 1.5%, and Taiwan charted imports rise 0.1 million mt or 2.8%. South Korean winter imports fell 85,000 tons or down 0.7%.

So how did JKM Swaps perform through 2017, and more importantly, how did it perform through this past winter? The graph below suggests two insights.

JKM Swaps vs Settlement Price

The candlesticks are sorted by each JKM Swap contract month, showing the first done deal price, highest and lowest deal price, as well as the last done deal price. Increased liquidity in the derivatives market now better reflect and signal either a continuation or change in pricing trend. In instances of the gap between the first and last done deal levels widens, it suggests increasing momentum behind the uptrend or downtrend in the JKM settlement price. And when that gap narrows or flips direction, it also suggests a turning point can be expected for the JKM physical settlement price.

Secondly, the graph also shows that the derivative market is also mirroring the increased seasonal volatility seen in the physical market. Volatility – the length of the candlesticks – shown by the difference between the initial price expectations (first deal price) and final price expectation (last deal price). The JKM Swaps market also show stronger seasonality pattern and predominantly winter having an increasingly outsized influence compared to summer. It also shows that while summer JKM Swaps trading has seen highs and lows beyond the first and last done deal level, winter trading sees highs and lows converge on first and last done deal levels respectively.

Overall, improved visibility over price trends may seem modest progress. It has, however, facilitated the market’s ability to mitigate risk, not only through price hedging, but also through inventory and portfolio management. Several Northeast Asian end-users concluding time swap deals over the winter period in part referencing forward JKM Swaps prices, easing the challenge to find an agreeable fair market cargo value for both buyers and sellers.

While JKM Swaps volumes have averaged over a cargo a day in January, liquidity is still ramping up as a proportion of total global LNG trade. In oil markets, derivatives trade several times the size of the physical market.

But baby steps, no matter how small, are steps in the right direction.

[maywillow] 29/3/2018 06:02

Why Natural Gas Prices Will Rise This Summer
By Nick Cunningham - Mar 27, 2018, 6:00 PM CDT shale gas

Record production of natural gas is snuffing out any price rally that might have occurred from the bout of cold weather this winter.

The gas market saw a jolt at the end of December and in early January due to extremely cold temperatures across much of the U.S. This winter was about 13 percent colder than last year, which pushed up residential and commercial gas demand by 3.5 billion cubic feet per day (Bcf/d), according to Barclays.

At the same time, demand continues to grind higher on a structural basis, with more LNG exports leaving U.S. shores and more utilities burning gas for electricity. That led to a sharp drawdown in gas inventories, pushing them 16 percent below the five-year average in the first quarter.

Nevertheless, the price impact was muted. In the past, sever cold snaps have led to sharp price spikes. While that happened in regional spot markets, the price increases were very short-term and nothing like the price increases during the 2014 Polar Vortex. After the cold subsided, Henry Hub spot prices fell back below $3/MMBtu.

Gas traders are so sanguine because the U.S. is producing more natural gas than ever. And 2018 is shaping up to be a record year for new gas output. A mild streak during February eased some pressure on inventories as well.

As a result, the U.S. will likely see “heavy” gas injections during the second quarter, according to Barclays. The bank expects gas inventories to rise at a pace that is 1 Bcf/d higher than last year.
Related: $70 Oil Could Spark An Offshore Oil Boom

Barclays sees gas output growing by 6.4 billion cubic feet per day this year. That is an impressive figure, but it will be aided by the fact that a lot of drilled but uncompleted wells (DUCs) could come online in 2018.

Still, Barclays says that record production and higher natural gas prices are not necessarily mutually exclusive. While there isn’t really a bullish case for gas, Barclays says that prices are probably a bit oversold. Inventories will rebuild quickly this spring, but the U.S. will still enter summer months with inventories 17 percent below the five-year average.

Meanwhile, there is a bit of a geographical mismatch between supply and demand, with gas growing at extraordinary rates in the Marcellus Shale and Permian basin, while demand growth is largely concentrated along the Gulf Coast. That could result in some higher gas prices along the Gulf Coast, helping gas drillers there.

But, ultimately, prices will have to go up ahead of next winter in order to adequately replenish gas inventories. If prices were to remain where they currently are, there would be a much larger coal-to-gas switch happening for electricity generation. Leaning harder on gas-fired power plants, made possible by low prices, would result in a smaller gas injection into storage. In other words, if natural gas prices do not rise, the U.S. would enter the winter season with too little gas on hand.
Related: China's Oil Futures Launch With A Bang

So, Barclays predicts Henry Hub prices will average $3.12/MMBtu over the course of injection season, which lasts until November. Higher prices this summer would turn off some coal-to-gas switching in the electricity sector. For instance, a move from $2.70/MMBtu to $3.00/MMBtu would destroy about 700-800 MMcf/d of gas-fired power burn, which would translate into about 150 Bcf of extra gas to put in storage over the course of the injection season, according to Barclays.

Barclays is not alone in that assessment. “If this winter’s level of year-on-year demand growth can be sustained into the spring and summer, prices may need to move higher to achieve adequate storage levels by the end of October,” said analysts at Mobius Risk Group, according to Natural Gas Intelligence.

By Nick Cunningham of Oilprice.com

[maywillow] 27/3/2018 18:53

GTT: and one more LNG carrier!

Aymeric Val, published on the 27/03/2018 at 17h55
GTT: and one more LNG carrier!
Photo credit © GTT Company / Hyproc

(Boursier.com) - The beautiful commercial dynamic continues for GTT. The French group announces on Tuesday that it has received an order from Samsung Heavy Industries (SHI) to equip a new LNG carrier with its new Mark III Flex + membrane containment system.

This unit, with a capacity of 180,000 m3, will be built on behalf of a European shipowner, on the site of SHI in South Korea. Its delivery is scheduled for the second quarter of 2020.

The Mark III Flex + solution achieves a daily evaporation rate of 0.07%, due to its increased thickness and reinforced secondary membrane. This LNG carrier will be the second equipped with the latest developments in technology

[sarkasm] 27/3/2018 18:09

Global LNG market avoids 'glut,' now supply crunch nears: HSBC

London (Platts)--27 Mar 2018 1050 am EDT/1450 GMT

The global LNG market has avoided a supply "glut" thanks to strong Asian demand, but the dearth of new project approvals is set to lead to a supply crunch around 2022-23, analysts at HSBC said in a report published Tuesday.

* Report backs Shell view of LNG market balance

* Lack of supply FIDs to trigger shock in 2022-23

* Suggests new financing flexibility for projects

HSBC backs the standpoint of Shell, which last year defied most industry commentators by dismissing the perception of an oversupplied global LNG market.

Shell last month said it expected the growing LNG supply to be "comfortably" absorbed by rising demand, but also warned of a supply crunch "in the early 2020s."

The startup of a slew of new LNG projects in the US, Australia and Russia was expected to result in a global supply glut since around 2016, with excess LNG cargoes forecast to end up in the liquid European markets of last resort.

But that wave has yet to materialize, and increasingly market observers are forecasting that demand will keep up with supply in the coming years.

HSBC's report -- "The glut abates, the crunch awaits" -- said there were reasons to believe the global LNG market would be well supplied, rather than oversupplied, to 2021-22.

"That's partly a reflection of seasonality -- the market may be oversupplied in summer, but undersupplied in winter," HSBC said.

This was a view also put forward last month by Pablo Galante Escobar, the head of LNG at trading house Vitol, who said the global LNG market was likely to see more notable swings in price between the winter and summer months as demand in countries such as China falls off in the summer and strengthens in the winter.

"Seasonality will be much more accentuated -- we expect to see weaker summers and stronger winters," Escobar said.

DEMAND GROWTH

HSBC said it expects global LNG demand to grow at 4.5%/year, translating into demand growth of 50% by 2025, with consumption reaching some 425 million mt/year from last year's level of some 280 million mt.

Other forecasters have predicted stronger demand growth in the near term, with consultancy Bloomberg New Energy Finance last week saying global LNG demand was set to rise by 7.2% to 305 million mt in 2018 driven by increased imports in Asia and Europe.

The 305 million mt figure also tallies with S&P Global Platts Analytics' own forecast of global LNG demand for 2018.

Global LNG imports in the first two months of 2018 are already up 5 million mt year on year at some 54.3 million mt, according to S&P Global Platts Analytics data.

BNEF, meanwhile, said demand growth this year would be slower than in 2017 when consumption increased by 9.6%, with growth set to slow to 2022.

Nonetheless, the solid outlook for LNG demand, HSBC said, is underpinned by multiple factors including GDP growth, supportive government policy and climate and environmental concerns.

"Asia dominates demand growth to 2025, followed by Europe after 2025. By the mid to late 2020s we expect China to become the world's largest LNG importer, ahead of Japan," it said.

China was the surprise to the upside in 2017, with its LNG imports rising by more than 45% year on year.

SUPPLY CRUNCH

HSBC said it believes the industry has run out of time to avert a crunch in the 2022-23 to 2025 period.

"Our view is that supply is not going to be able to meet this strong demand growth -- indeed we think a crunch is looming," HSBC said.

The market could become tight by 2022-23 as supply flat-lines -- a result of new project approvals having stalled for over two years -- while demand continues to grow.

It said its view was supported by strong emerging markets gas demand, the winter demand seasonality pulling up prices in the northern hemisphere winter and "inevitable disappointments" on the supply side, such as start-up delays.

It also pointed to upside risks to prices in Europe -- and global LNG by knock-on effect -- from transit issues of Russian gas through Ukraine around the end of 2019 and early 2020.

Gazprom's transit deal with Ukraine's Naftogaz expires at the end of 2019, although the Russian gas giant is looking to terminate the deal even earlier after the Stockholm arbitration court ruled against it.

All of these issues, HSBC said, are being "exacerbated by the reluctance of some buyers to sign the long-term contracts which are needed for project financing."

"We believe it is already too late to avoid a pending supply crunch given long project lead times," it said.

HSBC suggested the easiest solution to get FIDs moving again would be for project operators to reduce their project sizes to lower the barrier for investment.

Other options include: launching projects with lower sales coverage (50% or less); borrowing from banks based on spot indices such as the S&P Global Platts JKM benchmark; using creative financing, e.g. from project bonds or contractors; and having trading houses bridge the gap between buyers and sellers.

--Stuart Elliott, [e-mail]

--Edited by Jonathan Dart, [e-mail]

[ariane] 23/3/2018 12:03

Shell sees potential LNG supply shortage as global demand surges

Feb 26, 2018

The global liquefied natural gas (LNG) market has continued to defy expectations of many market observers, with demand growing by 29 million tonnes to 293 million tonnes in 2017, according to Shell’s annual LNG Outlook. Such strong growth in demand is consistent with Shell’s first LNG Outlook, published in 2017. Based on current demand projections, Shell sees potential for a supply shortage developing in mid-2020s, unless new LNG production project commitments are made soon.

Japan remained the world’s largest LNG importer in 2017, while China moved into second place as Chinese imports surged past South Korea’s. Total demand for LNG in China reached 38 million tonnes, a result of continued economic growth and policies to reduce local air pollution through coal-to-gas switching.

“We are still seeing significant demand from traditional importers in Asia and Europe, but we are also seeing LNG provide flexible, reliable and cleaner energy supply for other countries around the world,” said Maarten Wetselaar, Integrated Gas and New Energies Director at Shell. “In Asia alone, demand rose by 17 million tonnes. That’s nearly as much as Indonesia, the world’s fifth-largest LNG exporter, produced in 2017.”

LNG has played an increasing role in the global energy system over the last few decades. Since 2000, the number of countries importing LNG has quadrupled and the number of countries supplying it has almost doubled. LNG trade increased from 100 million tonnes in 2000 to nearly 300 million tonnes in 2017. That’s enough gas to generate power for around 575 million homes.

LNG buyers continued to sign shorter and smaller contracts. In 2017, the number of LNG spot cargoes sold reached 1,100 for the first time, equivalent to three cargoes delivered every day. This growth mostly came from new supply from Australia and the USA.

The mismatch in requirements between buyers and suppliers is growing. Most suppliers still seek long-term LNG sales to secure financing. But LNG buyers increasingly want shorter, smaller and more flexible contracts so they can better compete in their own downstream power and gas markets.

This mismatch needs to be resolved to enable LNG project developers to make final investment decisions that are needed to ensure there is enough future supply of this cleaner-burning fuel for the world economy.

See Shell’s full LNG Outlook for 2018 at www.shell.com/lngoutlook