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[adrian j boris] 28/6/2018 18:59

Global Natural Gas Prices Rise for First Time in Two Years
By Mathew Carr
28 juin 2018 à 13:58 UTC+2



Global natural gas prices are increasing for the first time in two years with demand for the fuel advancing across the world.

Consumption of the cleanest fossil fuel is projected to grow under virtually all major scenarios, “including the most aggressive low-carbon transition scenarios,” according to a report published by Italian grid operator Snam SpA, the International Gas Union trade lobby and The Boston Consulting Group.

Higher prices were driven by mainly by the rising cost of crude due to its influence on oil-linked supply contracts, as well as stronger-than-expected demand for liquefied natural gas. Across the major global gas hubs, the U.S. remained the cheapest, with prices 62 percent less than those in Asia and half the levels in the European Union.

“The flexibility of gas and the ease with which it can be transported and stored make it an ideal partner for the growth of renewables,” Marco Alvera, the chief executive officer of Snam, said in an emailed statement. “And gas is well on the way to becoming a renewable-energy source itself, thanks to the development of green-gas technologies.”

Demand rose everywhere except in the U.S. Consumption declined there mainly due to the power sector where higher prices, pipeline constraints, and greater renewables production displaced gas.

As gas prices rose, the trend toward global price convergence continued in Europe and Asia, according to the report. Spot prices, or those for immediate delivery, showed similar patterns across the major markets for LNG.

Gas price levels remain higher than those for coal because there’s usually no “appropriate” price on carbon and other pollutants that would drive fuel switching, the report’s authors said.

Looking ahead, long-term contracts that continue to be linked to oil may become more costly versus spot markets, where there’s gas-on-gas competition, according to the report.
That price spread is also likely to be highly seasonal as demand varies and due to the lack of storage in Asia, the biggest LNG market.

“Storage will likely play a more significant role during periods of peak LNG demand.”

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[grupo] 27/6/2018 07:50

Europe will need LNG from US, pipe gas from Russia — Total CEO
Business & Economy
June 27, 7:40 UTC+3
Pouyanne said the extraction of natural gas has been on decline in Europe, including in the United Kingdom, Norway and The Netherlands
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Total CEO Patrick Pouyanne
Total CEO Patrick Pouyanne
© EPA/ETIENNE LAURENT

WASHINGTON, June 27. /TASS/. Europe will need both liquefied natural gas (LNG) from the United States and gas pipeline supplies from Russia due to the growing demand on the European market, Total CEO Patrick Pouyanne said.

"In fact, we need LNG from the US, and we need new regasification terminals, but we also need pipe gas from the other side because of the lack of [gas]," he said at a session of the World Gas Conference currently under way in Washington.

He said the extraction of natural gas has been on decline in Europe, including in the United Kingdom, Norway and The Netherlands. In the past 15 years, gas output dropped by one billion cubic meters annually compared to present-day figures, Pouyanne added.

After the US had become a net exporter of natural gas for the first time in 60 years due to the development of LNG sector, Washington started to threaten Russia with sanctions against its Nord Stream-2 Europe-bound gas pipeline project. European and Russian officials said on many occasions that the US policy of sanctions is intended to drive Russia out of the European energy market and fill the void with its LNG supplies.

Earlier, Russian President Vladimir Putin said that Russia would welcome European participation in the Nord Stream-2 project. He named France’s Total among potential partners.


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[waldron] 27/6/2018 07:39

Total, Pavilion Energy agreement advances LNG bunkering prospects in Singapore

Singapore (Platts)--27 Jun 2018 1202 am EDT/402 GMT

France's Total and Singapore's Pavilion Energy, through their subsidiaries Total Marine Fuels Global Solutions and Pavilion Gas, have signed an agreement to develop the LNG bunker supply chain further in the port of Singapore, the two companies said in a joint statement Tuesday.

The agreement between the companies covers the shared long-term time charter of a new generation LNG bunker vessel to be commissioned by Pavilion Gas by 2020. It also includes an LNG supply arrangement between the two companies enabling Total to deliver LNG bunker to its customers, the statement said.

The development comes after the companies concluded a memorandum of understanding in April 2017 to promote LNG bunkering in Singapore, the world's largest bunkering port, and signals the increased acceptance and commitment by customers and supplier toward LNG as a bunker fuel ahead of the International Maritime Organization's global sulfur limit rule for marine fuels.

The IMO will cap sulfur in marine fuels at 0.5% worldwide from January 1, 2020, from 3.5% currently. This applies outside designated emission control areas where the limit is already 0.1%.

LNG essentially eliminates both sulfur oxides and particulate matter emissions and reduces nitrogen oxides by up to 90%. It also helps tackle greenhouse gas emissions.

The progress is also important for Singapore, which has been at the helm of the initiative to promote LNG bunkering. The city state is also one of the world's most important LNG trading hubs.

A focus group, which was first formed in 2014 by the Maritime and Port Authority of Singapore, Antwerp Port Authority, Port of Rotterdam and Port of Zeebrugge, now consists of 11 ports and maritime administrations across Asia, Europe and North America.

In April 2017, Singapore also launched its first technical reference -- TR56 -- for LNG bunkering, which is aimed at providing a safe and efficient framework for conducting LNG bunkering operations in Singapore.

With LNG being readily available in Singapore, more vessels can choose LNG as a cleaner fuel of choice at the port of Singapore.

Ample LNG supply, thanks to burgeoning production from the US and Australia, means that fundamentals will not restrict its availability for bunkering. However, some sources have often cited lack of adequate LNG infrastructure and harmonization of standards and procedures as impediments to its widespread adoption globally, ahead of the IMO 2020 rule.

"The development of infrastructure is one of the key drivers for the take-off of LNG as a marine fuel. For the past few months, Total has been very active in that direction," Patrick Pouyanne, chairman and CEO of Total said in the statement.

This comes as Total Marine Fuels Global Solutions continues to develop the LNG bunker market.

The first milestones of its strategy were set in Europe, with the signature of LNG bunker supply contracts for Brittany Ferries and CMA CGM, as well as the long-term chartered bunker vessel with Mitsui O.S.K. Lines that will be positioned in northern Europe.

Pavilion Gas, for its part, has also been working toward the development of Singapore as an LNG hub.

In October 2016, Pavilion Gas was appointed as one of two importers to supply LNG to Singapore by the Energy Market Authority.

In January 2016, Pavilion Gas was awarded the LNG bunker supplier license to supply LNG bunker to vessels in the Port of Singapore.

In May 2017, the company carried out the first LNG bunkering truck-to-ship supply demonstration in Southeast Asia.

Last year, Pavilion Gas was also awarded a contract by PSA Marine for the supply of LNG bunker fuel from 2019.

Pavilion Energy looks forward to collaborate with partners to further develop the LNG bunker supply chain internationally, making it readily and reliably available for vessels worldwide, the company said separately.

-- Surabhi Sahu, [e-mail]

-- Abache Abreu, [e-mail]

-- Edited by Irene Tang, [e-mail]

[waldron] 25/6/2018 18:04

Shell opens ‘Belgium’;s first LNG station’

It says the facility in Herstal will be the first of many sites of its kind across Europe
Register now!
By Jonny Bairstow
Monday 25 June 2018
Image: siam.pukkato / Shutterstock

Shell has officially opened what it claims is Belgium’s first Liquefied Natural Gas (LNG) station.

The site in Herstal, Rue du Hermée, was commissioned in 2016 and has been built and tested by AECOM, which will remain responsible for maintenance of the facility.

Shell says the clear, colorless and non-toxic liquid which forms when natural gas is cooled is a suitable fuel because it is relatively clean and due to the low volume of space it occupies, making it easier, cheaper and safer to store and ship.

The energy giant says the fuel is cost-competitive for trucks that cover long distances, as well as producing less sulphur, particulates and nitrogen oxides compared to traditional diesels,

Laurent Charlot, Commercial Director of Shell Belgium, said: “Shell is committed to thriving throughout the energy transition and LNG will play an increasing role in the energy mix.

“The station in Herstal is an important step in the further expansion of our network of LNG stations in Europe.”

[grupo guitarlumber] 24/6/2018 19:14

Korea Rapprochement Could Revive Energy Megaproject
By Viktor Katona - Jun 24, 2018, 10:00 AM CDT KOGAS

The June 12 Trump-Kim summit in Singapore has had an overall positive effect on the oil industry, cooling down expectations about the imminence of a major conflict driven by the reckless behavior of leading political figures. Yet behind numerous geopolitical consequences, the discussion of which has taken up most of the media space, the summit also gave rise to smaller, regional ones. One of such is the resurgence of the Russia – North Korea – South Korea gas pipeline, which it seems is back on the agenda of both Moscow and Seoul. Gazprom’s admission that negotiations have been relaunched upon South Korea’s request is a harbinger of significant things to come.

The Russia-Korea gas pipeline has been on the tapis for more than 20 years. It was first raised in 1995 on the back of East Siberian gas fields being gradually brought onstream – even though the idea eventually evolved into the 38 BCm Power of Siberia project, the possibility of traditionally LNG-reliant Korea having its first onshore gas pipeline was flaunted regularly. The pipeline was supposed to pass start in the Russian city Vladivostok, then swerve towards North Korea, reaching Seoul in the end. It was never doubted that from the Russian side it would be Gazprom supplying the gas, since it has an export monopoly, from the South Korean side KOGAS and LG were mentioned amongst potential participants.

Despite what one might perceive as an extremely hostile business environment (North Korean warmongering), the project has maintained a firm government buttress from both Moscow and South Korea. The massive investment required on the territory of DPRK was thought to moderate North Korean temper, since the regime would be interested in the constant flow of transit revenues and not risk any escalation. In 2011, everything seemed ready to implement the plan – the Russia-born then-Supreme Leader Kim Jong-Il agreed for the pipeline to pass through DPRK, whilst Gazprom and KOGAS have signed a roadmap for the construction of a 10 BCm/year gas conduit. Yet Kim’s passing away in December 2011 and events unfolding afterwards have put the project off indefinitely.

Related: Uncertainty Looms Large Over Latin American Oil

Now, following several North Korean nuclear tests against the background of a very ambivalent relationship with the United States, Russia and South Korea reckon the time is ripe to revive the Vladivostok-Seoul pipeline. Do not expect legally binding obligations, though – it is evident that the any sort of agreement is highly dependent on Moon Jae-In remaining in office (and continuing his so far very successful policy of engagement with the Juche regime) and Donald Trump not making a U-turn on his commitments (he has gone from „little rocket man” to a „pretty smart cookie” within 9 months, after all). Trust-building needs time, especially when it comes to large-scale infrastructure projects.

At the core of the Vladivostok-Seoul gas pipeline is South Korea’s almost unprecedented dependence on imports to cover its energy needs – the rate stands at 98-99 percent for quite some time already. South Korea’s traditional means of generating energy largely boiled down to nuclear power and LNG, yet after the 2011 Fukushima catastrophe nuclear is about to be gradually removed from the national energy matrix. Korea’s LNG import capacities are undoubtedly spectacular, as the nation’s 4 LNG terminals can process up to 120 BCm per annum, double of South Korea’s actual natural gas needs. Yet if one is to compare LNG imports to South Korea and Gazprom’s exports to Europe, it becomes evident that Seoul has been overpaying massively.
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Since LNG supplies in Asia-Pacific are exposed to seasonal volatility, the average price Korean buyers pay for liquefied gas is often double of that European consumers pay ($344 vs $172 per MCm in January 2017, $390 vs $215 per MCm in January 2018). This alone is a significant boon for South Korea (even accounting for a LNG price drop in the near future), all the more so that it would prevent Seoul from burning polluting coal in an effort to cut down expenses. Constructing an onshore pipeline eliminates all the challenges stemming from previous Russian proposals – make South Koreans buy more Sakhalin LNG (which they already do) or to construct a subsea pipeline in one of world’s most seismically active zones. Yet even beyond the geopolitical realities of today, too many ifs imbitter the Vladivostok-Seoul gas pipeline’s prospects.

Related: Russia Gears Up To Boost Oil Production In July

Two-thirds (roughly 700km) of the Vladivostok-Seoul pipeline are supposed to pass through North Korean territory and there is no way of telling if there could be any sort of illegal tapping there. And if irregularities were to happen, how could Russia or South Korea make them stop? The last thing Russia needs is a potentially nuclear replica of Ukraine on its Far-Eastern border. If one is to see the glass half-full, the time it would take to sort out the details of the pipeline deal might be an advantage – many issues might evaporate if the promised denuclearization goes along as planned (and promised). If not, the plug on the deal can be swiftly pulled with minimal losses.

Thus, time is the biggest friend and enemy of the Russia – South Korea gas pipeline. Once (and if) the project is agreed upon, it will still take 3-4 years to actually build it, even in case of a fast-tracked procedure. Time would also help Russia understand where to source the natural gas from - whether from the E-Siberian fields of Kovykta and Chayanda or from elsewhere - and how to amend its transmission infrastructure so that the new pipeline would not interfere with Power of SIberia, slated to start on December 20, 2019. Yet two seemingly rational actors (Gazprom and KOGAS) depend on the dealmaking capacities of two seemingly irrational ones (Kim Jong-Un and Donald Trump). We will see how it all shakes out.

By Viktor Katona for Oilprice.com

[waldron] 20/6/2018 09:43

Shell said today that it had completed the sale of its 15% shareholding in Malaysia LNG Tiga (MLNG Tiga) for $750 million.

The Anglo-Dutch energy giant offloaded the stake to the Sarawak State Financial Secretary (SFS), which now has a 25% interest in MLNG Tiga overall.

The other shareholders of MLNG Tiga are Petronas, with 60% equity, Nippon Oil Finance, with 10%, and Mitsubishi Corporation, with 5%.

Shell said the sale was part of its $30 billion divestment programme, aimed at balancing the books following its acquisition of BG Group.

A Shell spokesman said: “Completion of this sale demonstrates the clear momentum behind Shell’s delivery of its global divestment programme.

“Shell continues to have a strong business in Malaysia and remains committed to the country.”

[maywillow] 16/6/2018 08:22

Oil, gas industry will be slow to change: former BP chief Browne

London (Platts)--15 Jun 2018 538 pm EDT/2138 GMT

Change in the oil and gas industry will be a long time coming, but technology and data can play a part in addressing the world's carbon emissions problem, former BP CEO John Browne said in an interview with S&P Global Platts.

Speaking after he and other executives discussed climate change at a meeting in the Vatican with Pope Francis this month, the British peer also said Europe would remain heavily dependent on Russian gas. Investors needed to engage with Russia, but with "eyes open," he said.

Browne is the current executive chairman of Russian-owned L1 Energy.

On the issue of climate change, Browne said both oil and gas would be needed for a long time to come and OPEC countries, which account for a third of world oil production and hold a meeting in Vienna this month to discuss output levels, are right to expect robust long-term demand. On the push in some quarters to divest from fossil fuels, a campaign the Catholic Church has backed in parts of the world, Browne said major oil companies were right to put more emphasis on gas projects, which can displace coal in power generation, and these would not be quickly superseded by renewables.

"The question is one of transition because this is the world's biggest industry, the biggest amount of infrastructure, and things can't move very, very rapidly. They can certainly move, but not rapidly," Browne said.

"Natural gas is part of the solution right now. One day it's going to be part of the problem and it will have to be replaced also, but right now the transition has to be handled sensibly. Gas is replacing coal for economic reasons everywhere."

Emissions reductions would be achieved through a combination of technology, including Carbon Capture and Storage, and the increasing use of data, particularly to increase energy efficiency, he said. Taxation of emissions could also speed up the transition away from fossil fuels, he said. "Artificially intelligent systems will allow us to put energy just where it should be used for just enough time, not hit-and-miss as we do at the moment. We have all the technologies we need, we just don't have them in a big enough scale or a low enough cost. The more you do, the cheaper it is," he said.

OPEC's oil ministers are unlikely to be swayed by talk of oil demand peaking, he said. "I have a sense that they have a realistic view of how long it will take before oil is not needed. It will be a very long time," Browne said.

RUSSIA DEPENDENCE

Browne said he didn't yet see an impact on the energy world as a result of tensions between European countries and Russia since the Skripal poisoning affair in the UK this year. But he said European dependence on Russia would intensify.

L1 Energy, the upstream oil and gas company headed by Browne since 2015, is backed by prominent Russian investors Mikhail Fridman and German Khan, both former partners in BP's Russian joint venture TNK-BP. The creation of TNK-BP in 2003 was among Browne's achievements in his 12 years as head of BP, and the UK major has continued to advocate close ties with Russia since the venture's fraught sale to Rosneft in 2013.

The poisoning in Salisbury prompted countries around the world to intensify sanctions against Moscow and some prominent Russians. Neither Fridman or Khan are subject to international sanctions.

In terms of any spill-over into the energy sector, "I'd say so far it hasn't affected things in my opinion," Browne said. "Other people would disagree in a very big way."

The growth of a global market in liquefied natural gas (LNG), delivered by tanker, will not end European dependence on Russia, Browne said. He highlighted the crisis surrounding the Netherlands' gas production due to earthquakes at the giant Groningen field as an example of Europe's reduced options.

"Any reduction of choices, sources in the world, does actually reduce security by definition. Europe is heavily dependent on natural gas from Russia and it has no choice because there aren't many sufficient indigenous sources that are going to grow in the future. Holland is now really in a very difficult situation," he said. "Increasing amounts of gas will be needed from Russia. If they can't be delivered to Europe for example, Europe will have a problem. It can probably get in LNG, but of course the cost base goes up."

Browne rejected the idea investors might do well to steer clear of Russia. Investment "has to be done carefully with the right partners in the right way with eyes open," he said.

"The thing about sanctions is they can be drawn in a very wide way or a very narrow way. They can be done for a variety of reasons. They don't have to have rationality behind them."

--Nick Coleman, [e-mail]

--Edited by Gary Gentile, [e-mail]

[the grumpy old men] 15/6/2018 10:09

GTT: still potential?

Claude Leguilloux, published on the 15/06/2018 at 10h02
GTT: still potential?
Photo credit © GTT

(Boursier.com) - GTT remains stable on the 53,60 euros after having been mandated by two major companies in order to carry out front end engineering studies (FEED) on new projects GBS terminals (Gravity Based System). "The expertise of GTT will have to confirm the economic, operational and logistical feasibility of this type of solution.It is too early to evaluate a future market, but this outlet confirms the multiplicity of potential markets for GTT" comments Portzamparc which remains to "strengthen "on the folder.

The first project, signed with a European EPC, concerns a major LNG liquefaction project comprising several concrete caissons with several liquefied gas containment tanks. The second project, led by an Asian partner to supply energy to an island, concerns a smaller metal GBS box.
For reasons of confidentiality, the names of the contractors of these LNG projects can not be communicated ...
PUBLICITY
inRead invented by Teads

These two types of GBS terminals are articulated around a concrete or metal box and membrane containment tanks designed by GTT. They are based on the sea floor, and can be installed in a port or isolated area, without the need for additional infrastructure.
The aim of these studies is to develop the design of GBS terminals and to validate the economic, safety and production aspects specific to GBS, drawing on GTT's experience and knowledge of LNG membrane containment. The studies will allow GTT to demonstrate the relevance of this innovative solution that combines the experience of GTT containment systems with GBS coastal structures ...

[maywillow] 11/6/2018 14:02

News // Transportation and storage
European companies getting ready for Turkish Stream gas
today, 15:22Neftegaz.RU2

St. Petersburg, June 11 - Neftegaz.RU. European companies are preparing for possible natural gas from the TurkStream natural gas project, Alexander Medvedev, vice chairman of the Russian state-owned gas and oil giant Gazprom said on June 8.



Speaking at a press conference in St. Petersburg, on the TurkStream project, Medvedev said Bulgaria has initiatives for a 2nd line to extend to Europe as part of the TurkStream natural gas pipeline project. «I think this shows Bulgaria's regret, which prevented the South Stream project, leading to its cancellation. We do not consult the Bulgarian route for the line to reach Europe in TurkStream for now,» he said.



A.Medvedev also said gas delivery to Turkey will start by the end of 2019. «The exact date depends both on the construction of the sea part of the project and on the readiness of the Turkish gas distribution system. However, it would 100 % start in 2019, no doubts about it.»



Turkey and Russia recently signed a protocol to jointly end the 2nd line of the TurkStream gas pipeline project by the end of 2019.



Pointing to the signing of a protocol between BOTAŞ Petroleum Pipeline Corporation and Gazprom for construction of the land section of the line to extend to Europe in TurkStream, Medvedev said for the 2nd line of the project, some natural gas transport systems in Europe need to increase capacity, adding that European companies have begun preparing for possible natural gas from TurkStream.



Gazprom previously said in a statement that with BOTAŞ it would create a joint venture, TurkStream Gas Transport, to construct the second line of the TurkStream project.

[ariane] 10/6/2018 18:17

New Players Enter The European Gas Game
By Vanand Meliksetian - Jun 10, 2018, 12:00 PM CDT Nat Gas

The expansion of the European Union in 2004 and 2007 indirectly led to several crises at a level not seen since the oil embargo of 1973. The accession of several former Warschau pact countries introduced an extra dimension to European politics: Russia. Due to historical reasons some of these countries have a high dependency concerning hydrocarbons on their large eastern neighbour. Several serious disputes concerning supply, pricing, and debt between Moscow and Kiev from 2005 until 2009 led to disruptions in supply to EU member states. These conflicts highlighted the need for reduced dependency on Russia.

During this period the search for alternative sources was already on its way, but the shutdown of gas supplies as a consequence of these disputes accelerated the process. The completion of two LNG liquefication plants in Poland and Lithuania has decreased the dependency of this region on Russia. The south-eastern flank of the EU, however, is in a direr state. In order to alleviate dependency, the European Commission obstructed construction of the South Stream pipeline from Russia through the Black Sea to Bulgaria.

This region is on the brink of a breakthrough as it stands to benefit from the diversification of routes to the east and south. Moscow, however, has not been sitting idle in improving its chances to maintain market share. In July 2018 the second phase of the Southern Gas Corridor, the Trans-Anatolian Pipeline or TANAP, will be finalized to export 6 bcm of gas for the domestic Turkish market from the Shah Deniz field in Azerbaijan. Another 10 bcm will be sent to Europe when the third phase Trans-Adriatic Pipeline or TAP, is finished in 2020.

Furthermore, the discovery of significant energy resources in the Eastern Mediterranean provides for an additional source. The most obvious beneficiary, due to its geographic location, would be the EU. There are several options on the table to transport natural gas to customers in Europe: LNG facilities in Egypt, pipeline through Turkish territory, and pipeline directly through EU member states Cyprus and Greece.

Israel will be exporting natural gas worth $15 billion or 64 bcm under a ten year deal with Egypt. These imports will add to Egypt’s domestic production in order to supply its idle liquefication facilities. Other alternatives to export significant volumes are pipelines through Turkey and Cyprus/Greece. Although infrastructure on land is significantly cheaper than subsea pipelines, the bellicose rhetoric of Turkish president Erdogan and the deteriorating relations between Turkey, Israel, and Cyprus deem such an option something of the past (for now).

A more expensive but politically safer alternative would be a subsea pipeline which Israel, Cyprus, and Greece have been exploring, the EastMed pipeline. This would transport 10 bcm of gas from the Eastern Mediterranean to Greece at a cost of $7.3 billion. The follow-up project that is supposed to take the gas from Greece further into Europe is called Poseidon and will run from the Greek coast to Italy. This pipeline has recently been upgraded to transport 20 bcm, 10 more than the EastMed pipeline. According to the project team, the upgrade has been designed to “allow multiple sources of gas, from Turkey/Greek border and from Eastern Mediterranean region”.
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Related: Oil Kingdom In Crisis: Saudi Royal Family Rift Turns Violent

Despite opposition from Brussels, the countries in the region show continued interest for Russian gas due to lower prices compared to LNG or other sources. In order to meet this demand, Moscow struck a deal with Ankara on 26th of May 2018 for a second string of the Turk Stream subsea pipeline to supply 15.75 bcm of natural gas to Europe. Gas giant Gazprom already opened a potential export route in 2017 when it struck an agreement with Italy’s Edison and Greece’s Depa to use the southern route for Russian gas through Poseidon, where the expanded 10 bcm capacity could be used.

However, Moscow’s plans also extend to other infrastructure in south-eastern Europe such as the TANAP and TAP pipelines constructed for Caspian gas. Moscow intends to participate in the auction system for the pipeline giving access to any would-be supplier. This would be contrary to the intention of the EU, which proposed diversification away from Russia. The ‘unbundling legislation’ of the EU provides equal access to transport infrastructure, meaning that legally Brussels does not possess alternatives to block Moscow’s intentions.

In recent years serious challenges have arisen for Russian gas export to Europe: the foiled South Stream pipeline, the EU supported rival Southern Gas Corridor, and the rise of the Eastern Mediterranean as a gas hub. However, Moscow has proven to be resourceful and relatively successful in maintaining its market share. The participation in multiple projects, including the Southern Gas Corridor meant to loosen Russia’s energy hold on Europe, has shown the interest for Siberian gas from European partners. Furthermore, the multitude of plans and intentions to participate in several projects has increased uncertainty for other would-be suppliers who potentially could invest in alternative sources. Ultimately this plays in the hands of the Kremlin whose export capacity remains essential until the near future.

By Vanand Meliksetian for Oilprice.com

[the grumpy old men] 08/6/2018 09:23

LNG giants teaming up

Shell, Petronas now lead partners in LNG Canada, nudging project closer to FID

Gary Park

for Petroleum News

One more building block has fallen into place to secure the future of LNG Canada, putting the C$40 billion project in sight for a final investment decision before year’s end.

Petronas, Malaysia’s state-owned energy giant, announced it is taking an equity position - without disclosing the investment amount - in the Shell Canada-led project, meaning the venture now has the backing of two LNG powerhouses.

As a result of the transaction, the ownership interests are now Shell at 40 percent (down from its earlier 50 percent), Petronas 25 percent, PetroChina 15 percent (previously 20 percent), Japan’s Mitsubishi 15 percent (unchanged) and South Korea’s Kogas 5 percent (previously 15 percent).

The partnership said the timing and outcome of the FID will be based on global energy markets and the overall competitiveness and affordability of the project.

Pacific NorthWest abandoned
Petronas, which abandoned its own C$36 billion Pacific NorthWest LNG project 10 months ago, blaming a weak global market outlook and the “extremely challenging environment” in Canada, said it is keen to join LNG Canada to take advantage of the export outlet for its vast natural gas reserves in northeast British Columbia’s North Montney resource which is operated by its subsidiary Progress Energy Canada.

Petronas said its role in LNG Canada includes the design, construction and operation of a gas liquefaction plant, facilities for the storage and export of LNG and marine facilities.

The estimated costs include TransCanada’s proposed C$4.7 billion Coastal GasLink pipeline from the Montney region to Kitimat on the northern B.C. coast.

Shell has argued that LNG Canada would help reduce greenhouse gas emissions by replacing more carbon-intensive commodities such as coal with LNG.

Federal tariffs unresolved
Still to be resolved is an issue for federal tariffs as Shell awaits a response from Canada’s Finance Department to exempt the project from anti-dumping duties of up to 45.8 percent on imports of fabricated industrial steel components, notably from China and South Korea.

LNG Canada Chief Executive Officer Andy Caditz said in early May he is confident the consortium will be ready to start construction this year. Initial shipments have been targeted for the 2022-24 period.

British Columbia’s New Democratic Party, at odds with its own resistance to Kinder Morgan’s Trans Mountain pipeline expansion, has offered significant tax relief to LNG Canada totaling C$6 billion over 40 years, although it still estimates revenues to the province will reach C$22 billion over the same period.

The project has considerable buy-in from aboriginal communities, led by the Haisla Nation Council, although the council has yet to sign a final commercial agreement.

[ariane] 07/6/2018 12:34

Dutch government eyes speedier Groningen natural gas output cut to below 12 Bcm/year

London (Platts)--7 Jun 2018 713 am EDT/1113 GMT

Natural gas production from the supergiant Groningen field in the Netherlands could be cut to less than 12 Bcm/year as early as October 2020, economy minister Eric Wiebes said Thursday in a letter to the Dutch parliament, earlier than originally expected.

* Economy minister sees quota reduction by October 2020

* Wiebes says work to reduce demand accelerated

* Output could fall to below 4 Bcm/year by 2022

The decline in production at Groningen -- which had a recent peak of 54 Bcm in 2013 -- is making the Netherlands and northwest Europe more dependent on imports, with output capped at 21.6 Bcm in the current gas year until the end of September.

Wiebes said Thursday that work was progressing well on several factors to reduce demand for low-calorific gas (L-gas) from Groningen, meaning the timetable for cutting the field's production quota could be accelerated.

These include the construction of a nitrogen plant at Zuidbroek for L-gas conversion, the conversion of 53 industrial consumers away from L-gas and a further reduction in German demand for L-gas.

"The combined effects on the level of gas extraction are still to be determined, but this could make it possible to lower the extraction level [to below 12 Bcm/year] even earlier than anticipated, possibly even by October 2020," Wiebes wrote.

Previously, Wiebes had said the most likely scenario was cutting production at Groningen to under 12 Bcm/year by October 2022, or possibly a year earlier.

The latest guidance could come as a shock to the European gas market, expecting to have higher production from Groningen for a few more years yet.

BELOW 4 BCM/YEAR

Wiebes also said Groningen output could be cut to below 4 Bcm/year as early as 2022.

"When the additional measures actually materialize, it is now possible to arrive in 2022 below 4 Bcm/year in an average year," he said, adding that in a cold year the level would be capped at 7.5 Bcm/year.

Wiebes said the Zuidbroek nitrogen plant would be operational in the first quarter of 2022, ahead of the previous timetable of 2023.

The realization of the plant will cut Groningen demand by 7 Bcm/year, Wiebes said.

The conversion of the 53 large-scale gas users in the Netherlands is expected to cut Groningen demand by a further 3.4 Bcm/year, he said.

He said many of them would come up with a plan of action for converting to H-gas "in the coming weeks."

--Stuart Elliott, [e-mail]

--Edited by James Leech, [e-mail]

[grupo guitarlumber] 01/6/2018 08:28

Shell Tries to Market Some of Its Natural Gas as Clean Energy
By Mathew Carr
1 juin 2018 à 06:01 UTC+2

Oil company testing market for fuel customers can call clean
Interest in the package coming, but no buyers yet, Shell says

Photographer: Chris Ratcliffe/Bloomberg

Royal Dutch Shell Plc is attempting to market some of its natural gas as clean energy, packaging it with credits for eco-friendly projects that offset pollution coming from the fuel.

The oil giant is offering business customers in Europe a combination of gas and certificates that show emissions are offset with financing for carbon-reduction projects. It’s testing markets in Germany, Italy, Spain and Britain to gauge demand for what credits to use, according to David Wells, head of Shell Energy Europe.

The move is the latest sign that oil companies are seeking to adapt to tighter environmental rules and the urge by policy makers worldwide to cut greenhouse gases. Natural gas is the cleanest of fossil fuels, though it still produces carbon dioxide blamed for heating the Earth’s atmosphere. By selling pollution offsets with the gas, Shell could “neutralize221; the impact of that fuel on the climate.

“Most companies are fairly early in the sustainability journey, so there’s a huge amount of interest” from potential customers, Wells said in an interview. “The point of transaction may be a little bit further down the track.”

Other oil companies have taken steps to reduce the carbon footprint of their fuels.

BP Plc invests in emission-reduction projects worldwide to compensate for emissions in producing lubricants to acids. The program, called Target Neutral, has offset 3 million tons of carbon dioxide since 2006, about the same as taking 1.3 million cars off U.K. roads for a year.

Total SA’s Ecosolutions focuses on improving development, production and marketing of its products. The Paris-based company said in November it had cut 8 million tons of emissions under the program since 2009. The savings were 1.9 million tons last year, according to data on the company’s website.
Under Pressure

Shell is offering its credits as oil companies face increasing shareholder pressure to tackle global warming and recognize the need to shift their business plans toward clean-energy targets in the 2015 Paris climate deal.

Oil and gas products can be offset by selling emission credits, though it’s unclear how to account for such transactions because nations have yet to agree on rules under the Paris deal. Shell’s emission-reduction credits will be verified by firms outside the company, Wells said.

“Deforestation schemes are the most obvious ones,” he said. “This is a voluntary offset, so it has to be something that resonates with the customer. That’s still a work in progress.”

— With assistance by Francois De Beaupuy, and Kelly Gilblom


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