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LNG Unlimited is the only weekly publication that offers an exclusive insight right across the LNG supply chain. From exploration and liquefaction through to shipping and regasification, LNG Unlimited's team of dedicated global reporters provide quality and comprehensive LNG news. If LNG is your business then LNG Unlimited is your vital link in the value chain.

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A JOINT TRADEWINDS AND UPSTREAM PUBLICATION                                                                 27 November 2009 • No. 152



INSIDE
                          Petronas fires gun
                          on imports gambit
                          Malaysia set to
Waiting on Tel Aviv       launch trading
Israel breaks bread       hub to take on
with contenders
for FSRU terminal
                          Singapore rival
                      3
                          CHRIS MEYER and
Chubu at front of         LUCY HINE London
Japanese queue
for Q-Max cargo           Malaysian state energy
                          company Petronas has
                      4
                          kicked off tendering for
                                                         Supply side: how the partners see the Gladstone LNG plant in Queensland shaping up
Seven line up for         what will be the country’s
                                                                                                                                          Illustration: SANTOS
new Nigeria gas           first LNG import terminal.
processing plants            A number of international   LNG scheme in Australia,         contracts from its Malaysia       on the project is scheduled
                          contractors are understood     could be linked to existing      LNG complex in Bintulu on         for early to mid-2010.
                      5
                          to be bidding for a            oil refinery infrastructure in   Borneo island.                       Malaysia remains, however,
Drilling campaign         pre-front-end engineering      the area.                           The source said the            some way behind neighbour
gets off to flying        and design contract with an       One source suggested it       import project would also         Singapore in developing an
start at Woodside         award expected early next      would be able to handle up       be designed for use as an         import facility.
 PRODUCTION       8       year.                          to 5 million tonnes per          LNG trading hub.                     The Singapore Energy
                             Planners have already       annum of LNG with the               Petronas signed up to the      Market Authority is already
Clever money on           plumped for an onshore         start-up five or six years       3 million tonnes per annum        evaluating bids for two
duo to win charter        solution.                      away.                            Gladstone liquefaction plant      engineering contracts with
prize at PNG LNG             While the location has         Despite being one of the      in Queensland with the            awards for the project
SHIPPING        9         not yet been formally          world’s largest LNG              explicit intention to direct at   management consultancy
                          decided one contractor         exporters, Petronas has          least some of the product to      and the main engineering,
Falcione selects a        pointed to Port Dickson on     long been planning an            the Malaysian market.             procurement and
new crew member           the shore of the Malacca       import terminal of its own          The company has a 40%          construction packages due
for Albania project       Straits some 90 kilometres     to help meet domestic gas        stake in GLNG, giving it a        later this year or early next.
 TERMINALS      10        from Kuala Lumpur.             and power requirements,          secured off-take of 2 million        BG Group will supply up
                             The terminal, which         particularly on the west         tpa for 20 years from 2014        to 3 million tpa of LNG,
Profitable calculus       would be supplied by the       coast.                           with an option for a further      starting with 1.2 million tpa
in Latin America...       Petronas/Santos coalbed           It would continue to          1 million tpa.                    when the terminal begins
 MARKETS        11        methane-backed Gladstone       meet long-term export               A final investment decision    operations in 2012.
2 • NEWS                                                                                                          LNG Unlimited                   27 November 2009




Leader                          EDF cargo to help China fight big chill                                                                      • Growing LNG




                                                                                                                                    Briefs
                                Electricite de France looks      (built 2005), currently          grip of an exceptionally cold              imports are likely to
                                                                                                                                             limit US natural gas
                                set to ship a spot cargo to      named Golar Maria while          winter. This week PetroChina
                                                                                                                                             prices over the next
                                the newly opened Shanghai        under its present                revealed it has leased capacity
Gas glut                        LNG terminal as China
                                fights a cold snap.
                                                                 management, will lift an
                                                                 export cargo from the
                                                                                                  at Shanghai and intends to
                                                                                                  import up to 10 spot LNG
                                                                                                                                             two years, according
                                                                                                                                             to Wood Mackenzie.
                                                                                                                                                A step-up in
working                            Chartering sources said
                                the 140,000-cbm Gracilis
                                                                 Zeebrugge LNG terminal.
                                                                   Parts of China are in the
                                                                                                  shipments to relieve fuel
                                                                                                  shortages (see page 10).
                                                                                                                                             volumes from new
                                                                                                                                             liquefaction projects

for the                                                                                                                                      in the near term will
                                                                                                                                             push more supply to
                                                                                                                                             the country, the LNG
Chinese                                                                                                                                      market of last resort,
                                                                                                                                             the consultancy said.
Like Michael Corleone in                                                                                                                        Downward
the Godfather Part III,                                                                                                                      pressure will also
they wanted out but were                                                                                                                     come from shale gas
dragged back in.                                                                                                                             and a move towards
   Chinese buyers had                                                                                                                        coal-fuelled power
                                                                                                                                             production, it added.
forsworn involvement in
                                                                                                                                                Gas prices are
the global spot market                                                                                                                       expected to average
but this week a blistering                                                                                                                   $4.50 per million
drop in temperature in                                                                                                                       British thermal units
parts of the country sent                                                                                                                    in 2010, edging up
PetroChina racing to snag                                                                                                                    to $5 in 2011.
prompt volumes.
   It is in the market for
                                                                                                                                             • Greek companies
                                                                                                                                             Motor Oil and
10 spot cargoes that it                                                                                                                      Mytilineos have
will direct to the new                                                                                                                       unveiled a 50:50
Shanghai LNG terminal.                                                                                                                       joint venture to carry
   At least one has already                                                                                                                  out natural gas
been secured, a re-export                                                                                                                    trading activities and
cargo from Belgium’s                                                                                                                         have lined up a first
Zeebrugge terminal.                                                                                                                          LNG import cargo,
                                                                                                                                             according to the
   The timing is fortuitous
                                                                                                                                             ANA-MPA news
for the Chinese. There is                                                                                                                    agency.
an abundance of LNG in                                                                                                                          The venture, the
the spot market and                                                                                         Photo: FREEPORT LNG              first aside from
European importers are                                                                                                                       state-run Depa to


                                Citigroup to open
already well supplied.                                                                                                                       handle LNG imports,
   Gas demand is still very                                                                                                                  will seek gas supplies
                                                                                                                                             for the two
low in the continent and
                                                                                                                                             companies’ own


                                re-export account
prices are similarly weak.                                                                                                                   plants and also
   European players are                                                                                                                      potentially for third
likely to be grateful for                                                                                                                    parties.
the chance to offload                                                                                                                           Additionally, the
some of their volumes
and, potentially, at juicier
prices than might have
                                at Freeport LNG                                                                                              partners will take
                                                                                                                                             delivery of and
                                                                                                                                             jointly sell a 65,000
                                                                                                                                             cubic-metre LNG
been expected.                  US investment                    brokers. The shipment,           players currently bidding for              cargo that is due to
   The over-supply                                               which is due to be loaded at     a Trinidad cargo lifting on
situation in Europe has         bank said to be                  the terminal next week, is       21 December.
                                                                                                                                             arrive at the
                                                                                                                                             Revythoussa import
reached significant levels
as LNG pours in to avoid
                                in for long haul                 understood to be destined
                                                                 for South Korea.
                                                                                                     This is Citigroup’s second
                                                                                                  foray into the LNG sector.
                                                                                                                                             terminal west of
                                                                                                                                             Athens on 2
even lower US prices.           on LNG trading                      Macquarie Bank is also           In August the company                   December.
   Sources talk of at least                                      reported to be in talks for      fixed the 140,000-cbm
one re-export cargo a           LUCY HINE London                 the export of a cargo in         Golar Arctic (built 2003) for
                                                                                                                                             • Gazprom Global
                                                                                                                                             LNG is rumoured to
month being offered from                                         storage at Freeport, which       135 days at a rate in the                  be the buyer of a
Zeebrugge while there           Citigroup is preparing to lift   was originally designed as       mid-$30,000s per day                       spot cargo offered by
have been suggestions           the first re-export cargo        an imports-only facility.        range to lift a Trinidad                   Abu Dhabi Gas
that Spanish and                from the Freeport LNG               A deal is expected to be      cargo.                                     Liquefaction
Portugese buyers could          terminal (above) in the US.      concluded in December.              The LNG was stored on                   Company.
expect to re-export                The investment bank has          Industry sources said Citi,   the vessel for several                       GGL is said to be
around 30% of their LNG                                          which has around four            months before Citi sold it                 using its chartered
                                fixed the 149,700-cbm
                                                                                                                                             149,700-cbm vessel
next year with a wedge          Clean Force (built 2007) for     traders working on LNG, is       and passed on the charter                  Clean Power (built
going to Asia.                  a period until mid-February      making an aggressive play        to GDF Suez.                               2007) for the
   This is not a situation      at a rate of around $45,000      for more cargoes and hopes          The French company is                   shipment, which
many had envisaged and          per day to ship the              to tie up three to four deals    due to import the cargo into               traders said they
once again shows the            ConocoPhillips-owned             by the year-end.                 its Everett LNG terminal                   expect to head for
flexibility of this industry.   product, according to               Citi is among the myriad      near Boston next week.                     Japan.
3 • NEWS                                                                                                      LNG Unlimited              27 November 2009



Oman back
round table
                                Israel breaking bread with
for Kish gas                    FSRU terminal contenders
Oman has held fresh talks       Pre-qualification                                                                               to help to finalise these
with Iran about tapping the                                                                                                     details.
$12 billion Kish Island gas     now under way                                                                                      The build, operate and
field to feed its Qalhat LNG    to build and run                                                                                transfer contract will cover
plant, according to Iranian                                                                                                     the planning, financing,
officials.                      import project                                                                                  operation and maintenance
   The sultanate said earlier                                                                                                   of a 4 billion cubic metres
this year that it was           CHRIS MEYER London                                                                              per annum facility.
postponing by at least 12                                                                                                          The tender winner will
months its plan to finance      Six groups are throwing                                                                         receive a concession to
the project while Iran          their hats in the ring to                                                                       operate the installation for
claimed it would proceed        develop Israel’s maiden LNG                                                                     20 to 30 years, at the end
anyway.                         import project.                                                                                 of which the infrastructure
   Oman signed a preliminary       Pre-qualification is now     Leisurely pace: planners are waiting for a formal project       will be transferred to the
pact in 2008 effectively to     under way with all the          sanction from ministries in Tel Aviv (above)                    state.
finance the development of      teams, which include                                                   Photo: BLOOMBERG NEWS       Customers of the facility
the estimated 50 trillion       big-name players such as                                                                        will be expected to arrange
cubic feet of gas reserves at   BG Group, Hoegh LNG,            infrastructure, a process     import LNG. Although the          LNG volumes themselves
Kish.                           Excelerate Energy and Golar     that has already taken        precise project configuration     and there is no gas
   In exchange it would pipe    LNG Energy, likely to be        months.                       remains to be decided,            distribution aspect.
some of the eventual 3          passed, said a source.             “The tender had been       possible sites for the facility      BG Group has had an
billion cubic feet per day of      A full tender is scheduled   planned for around March      have been sifted down to          on-off relationship with
output to the Qalhat LNG        to be launched by the           but because of delays with    Ashkelon or Hadera, and a         Israel over the past four
plant.                          middle of next year.            the national permit it will   final decision will be taken      years or so. The two parties
   The resumed talks are           However, planners are        probably be pushed back,”     next year.                        held numerous discussions
said to have been held          still waiting on a formal       the source said.                 Zeus Consulting has been       over gas supply deals using
during a visit by Oman’s Oil    sanction for the project           The project will use an    working on the project for        reserves from the
Minister Mohammed               from the ministries of          offshore floating storage     Israel’s Natural Gas              Palestinian-owned Gaza
al-Rumhy to Tehran.             finance and national            and regasification unit to    Authority and is expected         Marine field.


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             Web           : www.cryonormprojects.com
4 • NEWS                                                                                                         LNG Unlimited             27 November 2009



Ample LNG supply driving
regas interest, says GLE
Interest in floating storage     on the Australian floating
and regasification projects is   LNG project it is pursuing
firming, according to new        with Thailand’s PTTEP.
midstream spin-off Golar            On its shipping
LNG Energy.                      operations, GLE and its
   In a third-quarter results    parent Golar LNG said spot
briefing on Friday, GLE said     business will continue to
developers are seeing the        face some challenges in the
availability of near to          short term due to the
mid-term LNG supply as a         oversupply of vessels.
“window of opportunity” in       However, while the rates
which to launch new import       and utilisation of its own
projects.                        ships is still unsatisfactory
   Along with formal tenders     overall, the companies
from countries including         reported an improved             Q-Flex first for Chita: inside the engine-room on the Al Ruwais                Photo: LUCY HINE
Israel, Indonesia, Uruguay       trading performance over


                                                                  Chubu at front of
and Jamaica, GLE said it is      the quarter.
“discussing numerous other          While short to medium
projects directly with           term LNG demand remains


                                                                  Japanese queue
interested parties”.             under pressure, the
   “Asia continues to            company said: “There are
represent areas of increasing    clear signs that an improved
activity,” the company said.     supply demand balance in
   Upstream, Australia’s
Gladstone LNG project,
where GLE is a shareholder
                                 the years to come will lead
                                 to a much needed
                                 improvement in charter
                                                                  for Q-Max cargo
and the primary off-taker, is
on target to ship its first
                                 rates.”
                                                                  Company’s Chita                 mid-December after Chubu
                                                                                                  upgraded the No.2 berth at
                                                                                                                                  been modified to accept the
                                                                                                                                  Q-Flex vessels. Tohoku
cargo in 2012.                   • Chief financial officer        terminal is being               Chita to be able to accept      Electric Power received the
   The company also said it      Graham Robjohns is taking        upgraded to take                Qatar’s larger-sized vessels.   first Q-Flex cargo at its
will complete conceptual         over the role of chief                                              Work on the berth was        Higashi Niigata terminal in
work by the end of this year     executive at GLE.                the Qatari giants               completed in early September    December 2007. Tokyo Gas
                                                                                                  and the shipment will be        and Tokyo Electric have also
GDF Suez off mark in Yemen                                        LUCY HINE London                used to check if there are      upgraded their facilities.
GDF Suez has lifted its first    of YLNG’s output over a                                          any issues that need to be         However, Japan has been
cargo under its long-term        20-year period.                  Qatar’s foundation              addressed.                      unable to accept Qatar’s
contract with new start-up          The company said the          customer Chubu Electric            Once the upgrade has         largest vessels, which so far
Yemen LNG.                       new source of LNG,               Power is gearing up to be       been given final approval       are very limited in the areas
  The 145,700-cbm Maran          strategically located to the     the first Japanese buyer to     by inspectors, the terminal     to which they can trade.
Gas Coronis (built 2007)         east of the Suez Canal, will     take in a Q-Max cargo.          will move on to bigger             To date 11 out of the 14
loaded a cargo from YLNG’s       enable it to serve US,              The utility has been         things.                         Q-Max vessels ordered
Balhaf plant for shipment to     European and Asia- Pacific       upgrading its Chita LNG            Preparations for the first   have been delivered. Apart
the company’s capacity at        markets.                         terminal, which is due to       266,000-cbm Q-Max are           from sorties to the new
the UK’s Isle of Grain              GDF Suez said “a              accept its first Q-Flex sized   expected to be completed        South Hook terminal in the
receiving terminal.              significant part” of the         shipment within weeks.          within the first quarter of     UK and a part-cargo to
  GDF Suez has contracted        volumes would be sent to            The 210,100-cbm Al           2010.                           Spain, however, the fleet
to buy 2.55 million tonnes       its Everett receiving terminal   Ruwais (built 2008) is             Chita will be the sixth      has largely idled off
per annum of LNG or 40%          near Boston in the US.           scheduled to call in            Japanese terminal that has      Fujairah.



                       
                       Economic Uncertainty & Emerging LNG Outlook in Asia: Surplus and Deficit Scenarios
                                                        8 – 11 February 2010 * Singapore

       REGISTRATION NOW OPEN!!                                                             Organised by:                     Supported by:
  www.cconnection.org/info@cconnection.org
  Agenda & Speakers Details, Please visit:
  www.cconnection.org/LNGAHome.htm
5 • NEWS                                                                                                               LNG Unlimited               27 November 2009




US launches
extradition
                                  Seven up for new Nigeria
bid as bribe                      gas processing facilities
net spreads Big names head                                       E.ON Ruhrgas, the UK’s BG
                                                                 Group, Norway’s Statoil
                                                                                                     commit to carrying out
                                                                                                     significant gas exploration
                                                                                                                                        output within five years to
                                                                                                                                        meet a domestic
A British lawyer is fighting      up teams set to                with Centrica of the UK,            activities that will help to       requirement forecast to rise
extradition to the US over                                       France’s Total with PTT of          support the country’s              from just over 1 billion cubic
accusations of funnelling
                                  bid on a trio of               Thailand, Korea Gas                 domestic sector as well as,        feet per day this year to
millions of dollars in bribes     major projects                 Corporation, and local              in the longer run, provide         nearly 5 Bcfd in 2013.
from contractors to Nigerian                                     player Oando with Canada-           feedstock for exports.                Uncertainty over
authorities.                                                     based Sahara Energy.                   More than 30 other              domestic needs and
   Jeffrey Tesler faces jail in   CHRIS MEYER London                Some of the teams,               companies that last year           available supply remain the
the US if sent there and                                         however, remain tight-              expressed an interest in           most significant factors
convicted.                        Seven consortia are lining     lipped on whether they will         investing in the schemes           holding up the sanction of
   He is accused of being         up to submit proposals for     actually submit proposals           have also qualified as             new liquefaction projects
the London connection in a        new Nigerian gas               while others, such as E.ON          possible minor investors and       such as the SevenPlus
bribery chain that linked US      processing facilities next     and Centrica have seen              could join larger alliances.       expansion at Bonny Island
contractor Halliburton, its       month.                         earlier formal agreements              The projects will be sited      and the greenfield Brass
subsidiary MW Kellogg and            The bidders have been       with their nominal partners         at Warri in Delta State,           LNG.
other companies to projects       asked to offer their           lapse.                              Obiafu in Rivers State, and
such as the Nigeria LNG           proposals on 18 December          Nevertheless, market             in the Cross River/Akwa            • Nigeria LNG has named
production plant on Bonny         for three plants that will     sources suggested most are          Ibom area.                         Basheer Koko as its new
Island.                           initially direct gas for       likely to offer in their plans.        The gas gathering and           deputy managing director.
   Halliburton and                domestic use but which            Nigeria expects the              processing projects, based           Koko’s career spans sales
associated companies have         could be advanced to LNG       so-called core investors to         in so-called franchise clusters,   and marketing in the
already paid out $579             liquefaction export projects   back the proposals for              will be located within             shipping, refining and
million in fines for breaching    in due course.                 central processing facilities       acreage already under              petrochemicals sectors. He
anti-corruption legislation.         According to Nigerian       with investments worth at           exploration by companies           has also worked in the LNG
   Another Briton, Wojcieh        National Petroleum             least $2.5 billion, eventually      such as ExxonMobil, Shell,         division at NNPC and held
Chodan, will face similar         Corporation, the groups are    increasing to around $30            Chevron and Total.                 various assistant ministerial
extradition charges in the        being led by Russia’s          billion.                               NNPC has ambitions to           roles. He replaces Engineer
New Year.                         Gazprom, ExxonMobil with          The companies must               double the country’s gas           Faithful Abbi Abbiye Suku.




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      6 • NEWS                                                                                                            LNG Unlimited                27 November 2009




      DVB calling bottom of the Regas
      market for utilisation rates vessels
                                   ‘set to
      Bank sees light
      at end of tunnel                                                                                                                        run out
      for LNG shipping,
      if from low base
                                                                                                                                              of road’
                                                                                                                                              DVB’s researchers declare
                                                                                                                                              themselves “not very
      LUCY HINE London                                                                                                                        optimistic” about the LNG
                                                                                                                                              regasification vessel sector
      Fleet utilisation for LNG                                                                                                               as they see challenges to
      carriers is expected to                                                                                                                 these specialised vessels
      improve in 2010, according                                                                                                              sustaining their competitive
      to analysts at Germany’s                                                                                                                advantage.
      DVB Bank.                                                                                                                                  They explain that the cost
         A market outlook report                                                                                                              of onshore regas terminals
      from the research and                                                                                                                   is expected to reduce.
      strategic planning                                                                                                                         In addition, regasification
      department titled                                                                                                                       capacity far exceeds total
      ‘Pessimism will take flight                                                                                                             import demand, especially
      with market bottom in                                                                                                                   in Asia and Europe.
      sight’ puts the current                                                                                                                    The analysts acknowledge,
      figure at 63%.                                                                                                                          however, that LNGRVs
         “While the increase in        STUNNER IN DUBAI:                 debut in the LNG                contractor on the                    could fill the gap in new
      utilisation year-on-year post    Drydocks World shipyard           conversion arena. Its           conversion. When                     areas where current regas
      2010 is expected to be           has begun work on the             state-owned parent DP           completed in mid-2010 the            capacity is non-existent.
      impressive, it will be from a    conversion of the five-year-      World stunned the credit        FSRU will be capable of                 They are more optimistic
      very low base,” the report       old Golar Frost (above) into      markets on Wednesday,           storing 137,000 cbm of               about the floating LNG
      cautions.                        an LNG floating storage           however, by asking for a        LNG and delivering 3.75              production sector. Capex
         The analysts say              and regasification unit for       standstill on its debts while   billion cubic metres per             costs for an FLNG plant of
      utilisation is not expected to   Italy’s Livorno import project.   it restructures.                annum of gas.                        about 1.9 million tonnes per
      reach the 86% levels seen           This is the Dubai yard’s           Saipem is acting as main          Photo: Drydocks World, Dubai   annum stand at $1.3 billion,
      in 2003-2004 “any time                                                                                                                  which compares well with
      soon”.                           expansion, we may begin to        2011. DVB forecasts that        until at least mid-2011. The         the $3.5 billion price tag on
         However, they do expect       see a supply squeeze in the       LNG newbuilding prices will     analysts reason that the lack        a 4 million tpa onshore
      LNG vessels to “do better”       LNG market as early as            slide in the next 18 months.    of new LNG carrier orders            liquefaction plant.
      over the next four years.        mid-2011,” the report states.     The analysts expect prices      will put downward pressure              Equally, setting up an
         DVB’s optimism is based           As a result, DVB reckons      for a 140,000-cbm vessel to     on yard prices.                      onshore plant can take up
      on IMF projections for the       LNG carrier freight rates         drop from a current $213           As charter and utilisation        to five years compared with
      world economy and                should improve by                 million to about $177           rates will be improving from         the conversion of an LNG
      forward natural gas prices.      mid-2010.                         million in mid-2011.            very low bases this will also        tanker to a floater, which
         The bank’s team sees gas          It also expects demand           However, they say that       be reflected in asset values.        could take less than two
      demand increasing by 4.8%        for spot cargoes to increase      this should mark the               “Second-hand values are           years.
      in 2010 and continuing to        in the short term but says        bottom of the asset price       expected to follow the                  “Theoretically, this niche
      rise into 2014.                  significant barriers exist that   cycle.                          curve for NB (newbuilding)           sub-sector in the LNG value
                   ad-4_print.pdf
         “Despite planned 20/05/2009   11:43:03
                                       can hinder the long-term             The bank believes asset      prices during the subsequent         chain looks attractive,” the
      (liquefaction) capacity          growth of this sector after       values will remain subdued      recovery,” DVB adds.                 analysts conclude.




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7 • NEWS                                                                                                        LNG Unlimited            27 November 2009




Shell charts easterly course
for extra Qatargas 4 sales
Latest mega-train                                                                                            Photo: QATARGAS    • Ann Pickard, currently
running 10 months                                                                                                               Shell’s boss in Africa, will
                                                                                                                                take charge of the
late due to delays                                                                                                              supermajor’s operations in
with earlier plants                                                                                                             Australia early next year.
                                                                                                                                   It is a busy time in the
                                                                                                                                country with the company
MARK HILLIER London and
                                                                                                                                participating in the
NASSIR SHIRKHANI Beirut
                                                                                                                                Chevron-operated Gorgon
                                                                                                                                LNG development while
Shell is hoping to tie up
                                                                                                                                putting together its own
additional sales of LNG to
                                                                                                                                3.5 million tonnes per
Asian customers from its
                                                                                                                                annum Prelude floating
Qatargas 4 mega-train
                                                                                                                                liquefaction project.
project (right).
   The supermajor’s Qatar                                                                                                       during the analysts’ trip that
country manager Andy                                                                                                            completion of the train will
Brown told analysts on a                                                                                                        be delayed by about 10
visit this week that sales                                                                                                      months to the end of 2010.
opportunities are being                                                                                                         Production is then expected
pursued in markets such as                                                                                                      to ramp up during the
China and Pakistan, “where                                                                                                      course of 2011. Brown
we see significant LNG                                                                                                          blamed the knock-on
demand based on replacing                                                                                                       impact of delays to earlier
higher priced fuels in the      was originally taken back in     3 million tonnes per annum      long-term take or pay          trains being built in Qatar.
power sector”.                  late 2005, Shell’s Elba Island   to PetroChina and 650,000       basis.”                           He added that
   There are other niche        regasification terminal in       tpa to Dubai have since           Qatargas as a whole has      construction is now
markets in its sights such as   the eastern US, which is         been lined up.                  been an aggressive seller of   reaching an “advanced
Bahrain and Cyprus, he          being expanded, was                 While capacity is still      LNG to Asia in recent          stage” with the first systems
added.                          viewed as the prime              available to Qatargas 4 at      months, notably signing        starting to be commissioned.
   When the decision to         destination for its output.      Elba, “there is potential for   memorandums of                    Shell has a 30% stake in
proceed with Qatargas 4            However, sales totalling      further long-term diversions    understanding covering an      the project and pegs its
                                                                 to the east of Suez             extra 7 million tpa to China   share of capital costs at
Chubu buys Gorgon stake                                          markets”, Brown explained.      during a recent visit by       about $2 billion.
Chubu Electric Power            additional 60,000 tpa based         “We have been                senior officials to Beijing.      Qatargas 4 is the last in
expects to acquire a            on its stake in the project.     marketing this LNG away           For Shell, Brinded said      the chain of six mega
0.417% interest in Gorgon       Chubu declined to                from the US to lock into        that the start-up of           liquefaction trains that will
LNG and sign up to buy          comment on the cost of the       long-term oil price             Qatargas 4, together with      push Qatar’s LNG
1.44 million tonnes per         acquired interest.               linkages,” said Shell           the recently sanctioned        production to 77 million
annum of its output by the         The company will be the       Exploration and Production      Gorgon LNG, will help          tonnes per annum by 2011.
end of this year.               third Japanese utility to take   boss Malcolm Brinded.           boost the supermajor’s LNG        It will receive 1.4 billion
  The Japanese utility said     a stake in the project after        “So far, about half of the   production by 40% to 26        cubic feet of gas per day
the supplies will kick off in   Tokyo Gas, which is buying       Qatargas 4 LNG has been         million tpa by 2015.           from the giant North Field
2014 and run for 25 years.      1%, and Osaka Gas with           sold to Middle East and Asia      On Qatargas 4, Shell         to produce 7.8 million tpa
  It is also entitled to an     1.25%.                           Pacific customers on a          executives acknowledged        of LNG.
8 • PRODUCTION                                                                                                   LNG Unlimited              27 November 2009




Drilling campaign gets off Statoil eyes
to flying start at Woodside December
                            for restart
Second well hits                start of what will be the
                                operator’s biggest ever
                                                                 • The Woodside-led North         phase but do not have
                                                                                                  feedstock gas.                  at Snohvit
                                                                 West Shelf LNG venture
chunky gas pay                  exploration campaign in          expects to produce record           Moore said the objective     Statoil’s Snohvit LNG
as operator seeks               Australia.                       volumes this year, according     of the big exploration          production plant in northern
                                   Eris-1 was drilled close to                                    campaign is “to find            Norway will remain shut
LNG feedstock                   the edge of the block
                                                                 to Eve Howell, the operator’s
                                                                 senior vice president for        enough gas for a couple of      well into December, the
                                adjacent to Chevron’s large      the project. Howell told an      trains of LNG.”                 company admitted this
RUSSELL SERANCKE                Wheatstone field.                investor briefing this week         Chevron recently beat        week.
Wellington and                     Woodside did not reveal       that the company is “well        Woodside to sign up                The outage is due to
MARK HILLIER London             if Eris might spill over into    on track” to resolve             Apache’s Julimar gas field as   faults that became apparent
                                the Wheatstone acreage,          teething problems with           a feedstock supply for the      when a restart was
Woodside Petroleum has          saying that there is             trains 4 and 5.                  rival Wheatstone LNG            attempted early this month
found more gas as it drills     insufficient drilling                                             development.                    after lengthy repair work.
for reserves to feed            information as yet.              Pluto is Noblige-1 in block         Woodside this month             The first problem lay in
expansion of its Pluto LNG         The well was the second       WA-404-P, which will be          awarded dual FEED contracts     one of the plant’s utility
development in Western          in a 20-strong campaign          drilled by the semi-             for the two-train Pluto         systems and has now been
Australia.                      that launched recently by        submersible Jack Bates.          expansion to KBR and Foster     fixed, while the second
   The Australian company       Woodside.                           Noblige-1 is a follow-up      Wheeler-WorleyParsons.          concerns an electric motor
said it intersected 60 metres      The first, Pelion-1, was      to this year’s Martell-1            Trains two and three will    in the cooling system. Work
of natural gas pay in well      unsuccessful in its deeper       discovery and Moore said         each be sized to produce        to replace the motor is
developed sands during          exploration target.              Woodside plans to put            3.4 million tonnes per          under way, Statoil said.
drilling of its Eris-1             However, it did prove up      down as many as eight            annum.                             The Melkoya plant was
exploration well on block       the south extension of Pluto     exploration wells in this           The two FEED studies are     closed from 15 August for
WA-34-L, which is also          where the top of the             area.                            expected to be completed        major upgrades and
home to the main Pluto          reservoir was higher than           The company is hungry         in the second half of 2010      maintenance, including the
field.                          prognosis, which the             for gas reserves to feed its     with a final investment         replacement of 15 heat
   Exploration boss Peter       operator said could add to       planned second and third         decision to follow. The first   exchangers.
Moore said Woodside is          the field’s reserves.            LNG trains at Pluto, which       train is 82% complete and          It was restarted on 7
“very pleased” with the Eris       The next well on              are in the front-end             is due to start LNG exports     November before shutting
result, which comes at the      Woodside’s agenda near           engineering and design           early in 2011.                  down the following day.
                                                                                                                                     Snohvit struggled with

Australian climate change pill                                                                                                    equipment failures and
                                                                                                                                  reduced capacity for more
easier to swallow for industry                                                                                                    than a year after its 2007
                                                                                                                                  start-up.
Gas producers have given a      Australian Petroleum             electricity, up to nine tonnes                                      It is expected to reach full
cautious welcome to             Production & Exploration         of emissions are saved for                                       capacity after the recent
Australia’s proposed            Association (APPEA)              every tonne produced in                                          upgrades.
amendments to its climate       acknowledged the                 Australia during the LNG
change legislation, writes      legislation is now less of a     production process.                                              Iranian gas
Amanda Battersby.               headache for the LNG                The revised package does
   The new proposals            sector.                          not yet resolve all the                                          flows flatline
agreed by the government           “It makes no sense to         industry’s issues but a                                          Iran’s natural gas
and the opposition offer        constrain the very industry      number have been                                                 production will remain at
A$7 billion (US$6.48 billion)   that has the most to             addressed, according to                                          2008 levels for the medium
worth of compensation to        contribute to the world          APPEA.                                                           term, according to the
LNG producers, electricity      addressing climate change,”         Robinson pointed out                                          National Iranian Gas
generators and mining           said APPEA chief executive       there is a great deal in the                                     Company.
companies.                      Belinda Robinson (right).        package that has been                                               “It is predicted there will
   Australia is planning a         “A well-designed scheme       deferred, delegated or                                           be no output increase in the
market-based carbon             would encourage the              made subject to review.                                          next three years,” NIGC
trading programme that will     expansion of Australia’s            This “continuing                                              head Javad Owji was
force greenhouse gas            LNG sector as more natural       ambiguity and uncertainty”                                       quoted as saying by local
producers to pay for their      gas, producing between           makes it “so critical that the                                   media.
emissions from 1 July 2011.     50% and 70% fewer                good faith demonstrated in                                          The comments are
   A A$610 million package      greenhouse gas emissions,        these negotiations is upheld                                     roughly in line with recent
for the LNG industry will       is substituted for coal in       while the detail is settled”,                                    progress on various gas
ensure all announced            generating China and             she said.                        National negotiators. The       projects, particularly at the
projects receive at least       India’s electricity,” she           Prime Minister Kevin          ruling Labor Party needs the    giant South Pars gas field.
50% effective assistance,       added.                           Rudd unveiled the revised        support of at least seven          They are an effective
said opposition leader             APPEA claimed that            plan after weeks of talks        opposition senators in the      acknowledgment that Iran’s
Malcolm Turnbull.               when LNG is used in place        between the government           upper house to pass             LNG production aspirations
   Industry body the            of coal to generate              and opposition Liberal-          legislation.                    remain over the horizon.
9 • SHIPPING                                                                                                     LNG Unlimited               27 November 2009




Clever money on DSME goes to Russia
                   with love as it eyes up
duo to win charter construction bonanza
prize at PNG LNG                                                                                 South Korea’s Daewoo
                                                                                                 Shipbuilding & Marine
                                                                                                 Engineering has signed a
                                                                                                                                   stake. DSME is one of a
                                                                                                                                   number of big-hitting
                                                                                                                                   shipbuilders that have
Chinese shipyard                and purchase deal that they     and AP Moller is due to
                                                                take delivery of the
                                                                                                 memorandum of                     formed partnerships with
                                sign as they try to drive                                        understanding with Russia’s       Russia.
seen as a sure bet              forward their domestic          unemployed 165,000-cbm           United Shipbuilding                  Compatriots Hyundai
to build required               expertise in LNG carrier        newbuilding Maersk               Corporation to upgrade a          Heavy Industries and
                                shipbuilding.                   Meridian early in the New        repair yard for LNG carrier       Samsung Heavy Industries
LNG newbuildings                   Earlier this month China     Year.                            construction.                     and Japan’s Mitsubishi
                                Petroleum & Chemical               ExxonMobil received              A DSME official                Heavy Industries have also
LUCY HINE London                Corporation (Sinopec)           shipowners’ bids for vessels     confirmed his company will        signed pacts with USC.
                                signed a heads of               this summer.                     be co-operating with USC             Last week top brass from
Two shipowners are being        agreement to buy 2 million         Overseas Shipholding          to modernise Zvezda               Russia including a
tipped to walk off with         tonnes per annum from           Group, AP Moller-Maersk,         Shipyard at the former            Gazprom-led delegation
long-term charters from         PNG LNG over a 20-year          Maran Gas Maritime, BW           naval base of Bolshoy             with chiefs from subsidiary
ExxonMobil’s soon-to-be         period to supply its            Gas, Knutsen OAS Shipping        Kamen in the Primorsky            Gazflot and the Shtokman
sanctioned PNG LNG              Qingdao receiving terminal      and Japan’s K-Line, NYK          Krai region in the Russian        Development Company
project.                        in eastern China.               and MOL were among               far east.                         paid a visit to Primorsky
   Danish giant AP Moller-         If confirmed the ships       those believed to have              The yard will be able to       Krai for a ceremony to mark
Maersk and Japan’s Mitsui       would be the first and          shown an interest.               build LNG ships; floating         the deal with DSME and
OSK Lines (MOL) are seen        perhaps only LNG                   The energy supermajor         production, storage and           another with Singapore’s
as front-runners to provide     newbuildings of 2009 and        requested offers on both         offloading units; and             Yantai Raffles Shipyard on a
a mix of new and existing       would come as a huge            newbuildings and existing        drillships required for the       new facility in Vladivostok.
vessels for the Papua New       disappointment to South         vessels in its tender for four   Shtokman gas and LNG                 During the visit Gazflot,
Guinea project in what is       Korean shipbuilders, which      to five ships of between         development.                      which has traditionally been
one of the few pieces of        have previously led the         150,000 cbm and 180,000             DSME said basic concepts       the drilling subsidiary of
new LNG carrier business        pack in construction for the    cbm.                             for the yard’s overhaul have      Gazprom, and USC signed a
this year.                      sector.                            The shareholders in the       been drawn up. However,           co-operation deal on the
   Market players said up to       Industry sources said        6.3 million tpa, two-train       the exact details including a     construction of supply
three of the ships required     MOL and AP Moller-              PNG LNG, which is due for        completion date still have to     vessels, floating drilling rigs
for the project would be        Maersk would also supply        start-up in early 2014, plan     be finalised.                     and LNG carriers, according
newbuildings built in China,    one existing vessel each to     to take a final investment          It added that Zvezda           to reports.
most likely at Hudong-          complete the PNG project        decision on the project in       currently repairs small              Russia is keen to grab a
Zhonghua Shipbuilding           fleet.                          December.                        commercial vessels and that       share of the 10 drilling rigs
Group near Shanghai.               Both have constructed           Asian buyers Tokyo            it has “a lot of space that       and platforms, 60-plus
   The Chinese authorities      uncommitted tonnage in          Electric Power, Osaka Gas        can be used for expansion         vessels and various floating
have been insistent that        the past few years.             and Taiwan’s CPC have            and upgrading”.                   and technical facilities and
they will control an element       MOL has two delivered        pencilled in long-term sales        The South Korean               up to 23 LNG carriers it
of the transportation for       newbuildings laid up at         deals covering 4.3 million       shipbuilder did not disclose      estimates will be needed to
each long-term LNG sale         Hyundai Heavy Industries        tpa.                             how much money it will            develop its offshore oil and
                                                                                                 invest in the facility but said   gas resources over the next

Global trade squeeze pinches at MISC                                                             it will hold only a minority      10 years.

Higher losses from its
containership business hurt
                                                  containerships, plus lower
                                player said net earnings to
                                                  earnings of 900 million from
                                30 September were 400
                                                                                                 Latest giants join QGTC
Malaysian giant MISC in                           its tankers and LNG vessels.
                                million ringgits ($118.5                                         Qatar Gas Transport               Rasheeda are due to be
the first nine months of this                        Looking ahead, the
                                million) against 1.25 billion                                    Company has taken delivery        delivered by SHI during
year, but bottom-line                             company said the
                                in the same period of 2008.                                      of two more large LNG             2010 with the entire fleet
improvements are expected                         “contraction of global trade
                                Revenues fell to 7.42 billion                                    carriers as the handover of       handover to be completed
from now on.                                      continues to pose
                                from 8.1 billion ringgits.                                       vessels in its massive fleet      by July.
   The state-controlled LNG                       challenges to the shipping
                                   It blamed a loss of 640                                       draw to a close.                    Nakilat also took delivery
carrier, tanker and liner                         industry as reflected by
                                million ringgits by its                                            The 266,000-cbm Shagra          of the 210,100-cbm Al
                                                  falling rates in petroleum,                    was delivered by Samsung          Nuaman from Daewoo
     LNG CARRIeR FLeet By tyPe                    chemical and container                         Heavy Industries (SHI). It is     Shipbuilding & Marine
Type       Delivered On order             Total shipping”.                                       the 11th of 14 Q-Max sized        Engineering. The Q-Flex
Ship             329            42          371      Earnings from long-term                     vessels to be handed over         ship will also be assigned
FSRU               2              2            4  charters in the LNG and                        to QGTC, or Nakilat as the        long-term to Qatargas 4.
                                                  offshore businesses will also                  company likes to be known.          The last of the 31-ship
FPSO               0              4            4
                                                  help to cushion the group                        Shagra is chartered             Q-Flex fleet, the 210,100-
RV                 6              4           10 from the downward                               long-term to the now              cbm Al Bahiya, is due to be
TOTAL            337            52          389 pressure on rates, the                           delayed Qatargas 4 project.       delivered before the
                   Source: LNG Shipping Solutions company said.                                    Sisters Zarga, Aamira, and      year-end.
10 • TERMINALS           LNG Unlimited                                                                                                            27 November 2009




Falcione picks latest crew                                                                                                                  • Phase one of




                                                                                                                                   Briefs
                                                                                                                                            Thailand’s maiden
                                                                                                                                            import terminal is

member for Albania project                                                                                                                  now 45% complete,
                                                                                                                                            according to state
                                                                                                                                            company PTT.
                                                                                                                                               It told an analysts
Bologna company                 geological factors along the    expected until next month       LNG volumes while it builds
                                                                                                                                            briefing that the 5.5
                                route of the sub-Adriatic       or early 2010.                  its onshore facility.
to conduct survey               pipeline that will take gas        Local company SPS is the        There has been no
                                                                                                                                            million tonnes per
                                                                                                                                            annum facility’s
over the pipeline               from the terminal to Brindisi   owner’s engineer while          decision yet as to whether                  storage tanks are now
                                                                                                                                            finished and
route to Brindisi               in Italy.                       Technip completed detailed      this would be a floating
                                                                                                                                            fabrication of the jetty
                                   The company will use its     design for the two-tank, 8      storage and regasification                  and regasification unit
                                Odin Finder survey vessel       billion cubic metres per        unit or an Excelerate                       is under way.
CHRIS MEYER London              and is expected to start        annum project last year.        Energy-style pure                              Start-up is still
                                work shortly.                      Costs have been              regasification vessel.                      scheduled for the
Italy’s Falcione Energia has       Falcione has already         estimated at €800 million          The company is pushing                   third quarter of 2011,
                                                                                                                                            although earlier
ticked off another contract     picked Golder Associates for    ($1.2 billion) for the LNG      one of three projects                       reports indicated this
award for its proposed LNG      a desktop environmental         terminal and €200 million       proposed for Albania.                       could be delayed on
import project to be sited in   study on the Italian end of     to build the 125-kilometre         The others, being                        the back of weak gas
Albania.                        the proposed scheme.            pipeline.                       developed separately by                     demand.
                                                                                                                                               PTT and Qatargas
   Geological Assistance &         An award for the dual           The facility is scheduled    Switzerland-based ASG                       have yet to confirm a
Services, based near            basic design and front-end      to start up in 2014.            Power and Norway’s Statoil,                 preliminary sales deal
Bologna, will carry out a       engineering and design             Falcione has already said    remain further behind both                  for 1 million tpa over
reconnaissance survey           package for the approach        it could use a temporary        in terms of engineering and                 10 years beginning
looking at land and             to the Albanian coast is not    floating solution to receive    permitting.                                 from 2011 as they
                                                                                                                                            continue to wrestle
                                                                                                                                            over price.

                                                                                                                                            • French designer
                                                                                                                                            Gaztransport &
                                                                                                                                            Technigaz has
                                                                                                                                            finalised a licence
                                                                                                                                            agreement with
                                                                                                                                            Energy World
                                                                                                                                            Corporation for
                                                                                                                                            the construction
                                                                                                                                            of a membrane
                                                                                                                                            containment system
                                                                                                                                            for land-based LNG
                                                                                                                                            storage tanks.
                                                                                                                                               EWC is currently
                                                                                                                                            planning a number of
                                                                                                                                            small-scale LNG
                                                                                                                                            production and import
                                                                                                                                            projects in the
Towering demand: Shanghai’s ever-growing real estate                                                  Photo: PER STAALE BUGJERDE            Asia-Pacific region.
                                                                                                                                               The deal, first

PetroChina to import spot cargoes                                                                                                           sketched out in May
                                                                                                                                            2008, is something
                                                                                                                                            of a landmark for
via rival’s plant to plug supply gap                                                                                                        GTT, which has
                                                                                                                                            been pushing to
                                                                                                                                            diversify from its main
PetroChina is leasing           cubic metres of gas to          cargoes. The shipments,    • Wuhan city is to build an                      business of designing
capacity at China National      eastern and southern China,     both from the Chinese      LNG tank capable of                              containment systems
Offshore Oil Corporation’s      citing comments from            company’s long-term        storing the equivalent of 20                     for LNG carriers in
Shanghai LNG import             Zhang Guobao, director of       contract with Malaysia LNG million cubic metres of gas                      the current quiet
terminal as part of the         the National Energy             Tiga, arrived in October and
                                                                                           to mitigate against future                       shipbuilding market.
countrywide strategy to         Administration.                 November respectively.     supply shortfalls.                               • Sempra LNG’s new
meet gas shortages.                The start-up phase at the       During the test period the City planners said this                       Cameron terminal on
   The company is looking       3 million tonnes per annum      teminal will receive one   week they would invest                           the US Gulf Coast
to snag between eight and       Shanghai plant is already       cargo a month from MLNG.   200 million yuan ($30                            was due to see its first
                                                                                                                                            Q-Flex LNG shipment
10 spot cargoes in the short    well under way.                 CNOOC expects to launch    million) to build the                            this week.
term. It plans to direct the       CNOOC has unloaded           full commercial operations in
                                                                                           Anshan LNG storage and                             The 210,100-cbm Al
equivalent of 700 million       the first two of six test       the second quarter of 2010.regasification facility.                         Oraiq (built 2008)
                                                                                              The mayor has requested                       was scheduled to
PGN does sums on twin island facilities                                                    a fast-track approvals process                   arrive at the
                                                                                                                                            Louisiana-based
Indonesia’s state gas           reporters. PGN still needs to   terminal, which is being   to allow construction to                         facility on Thursday,
distributor Perusahaan Gas      arrange project finance to      developed in tandem with   start as soon as February.                       according to electronic
Negara plans to allocate $1     cover around 70% of the         state power player PLN and    Anshan would be able to                       ship tracking data.
billion for two LNG             cost, however.                  Pertamina, and up to 150   supply 10 days’ worth of                           The cargo is the first
                                                                                                                                            received under a
receiving terminals in West        The company is targeting     MMcfd from North Sumatra revaporised LNG to the                             short-term supply deal
Java and North Sumatra,         an extra 400 million cubic         The projects are        local area while a second                        signed with Qatari
company president director      feet per day of gas supply      scheduled to kick-off      phase already on the table                       producer RasGas this
Hendi P Santoso told            from the West Java LNG          operations in 2012.        could double capacity.                           summer.
11 • MARKETS                                                                                                                 LNG Unlimited                                        27 November 2009




Profitable calculus                                                                            NATURAL GAS MARKET
                                                                                               EIA WEEKLY NATURAL GAS STORAGE REPORT



in Latin America...
                                                                                                                          20 Nov           13 Nov        Net week           1 year          5-year    Change vs
                                                                                                Stocks (Bcf)               2009             2009        change (Bcf)          ago          average* 5-year avg**


                                                                                                East                      2099             2101                 -2          1997            1954               7.4%

Load of arbitrage             respectively, by the            Johnson at Waterborne
                                                                                                West                        525              524                 1            468             456            15.1%
                              year-end.                       reckons a handful of spot
opportunities on                 There are more               cargoes could make their          Producing                 1211             1208                  3            966             982            23.3%

offer in region’s             terminals and expansions        way into Argentina’s              Total Lower 48            3835             3833                  2          3431            3393             13.0%

                              to come, although gas           floating facility this
disparate sector
                                                                                                Note: This report tracks US natural gas inventories held in underground storage facilities. Changes in reported stock
                                                                                                levels reflect all events affecting working gas in storage, including injections, withdrawals, and reclassifications
                                                                                                between base and working gas. The weekly stocks generally are the volumes of working gas as of the report date.
                              demand and the                  season.                          *Average levels 2004-2008, **Difference from 5-year average (percent).                                      Source: EIA

                              underlying drivers for LNG         Argentine utility Enarsa
                                                                                                NYMEX/HENRY HUB NATURAL GAS FUTURES PRICE CURVE
CHRIS MEYER London            demand vary significantly       has already extended the
                                                                                               5.40
                              across the region.              stay of Excelerate Energy’s
Latin American LNG is not        Mexico’s Altamira            138,000-cbm
a new story; well, not        terminal, Puerto Rico and       regasification vessel            5.30
altogether new. Puerto        the Dominican Republic all      Excelsior (built 2005).
Rico has been importing       use LNG as a base-load             A UK-based LNG                            5.163
                                                                                                         US$/MMBtu

base-load volumes for         fuel for power generation.      analyst argues, however,         5.20

power generation since           From next year, the          that even with relatively                                                                  5.253                                           5.266
                                                                                                                                                       US$/MMBtu                                       US$/MMBtu
2004.                         Mejillones terminal in          cheap LNG on offer Brazil
   However, it is true that   Chile will also direct          is unlikely to bring any         5.10
                                                                                                         January contract                        February contract                            March contract
a wave of new terminals is    significant volumes to the      more in as healthy                                                                                                                    Source: Bloomberg


giving the region a fresh     mining industry probably        hydropower levels and             UK NATURAL GAS FUTURES PRICE CURVE
prominence and creating       on a base-load basis.           increased Bolivian               33.0

an interesting trading           For Brazil, and especially   shipments have kept it
dynamic.                      for its terminal near Rio,      well supplied.
   Mexico is by far the       meanwhile, LNG is                  Chile is talking up the       31.0

biggest of the region’s six   conspicuously a top-up          possibility of piping its                   27.50                                                                                           32.50

importers.                    option, used for peak           own imported LNG across          29.0
                                                                                                        GBp/therm                                                                                       GBp/therm


   According to US-based      demand periods when             the continent to Argentina
                                                                                                                                                         30.50
Waterborne LNG, the           hydropower output and           in another reversal of                                                                   GBp/therm

country will bring in LNG     volumes from                    more traditional flows.          27.0
equivalent to just over       neighbouring pipeline              To complicate matters                 December contract                          January contract                        February contract
                                                                                                                                                                                                    Source: Bloomberg
130 billion cubic feet of     exporter Bolivia are low.       yet again, Peru LNG will
                                 Argentina uses LNG           come on stream next year.        • US natural gas futures rallied on Wednesday amid short
gas in 2009 compared
                              seasonally for heating but         Operator Repsol is likely     covering ahead of this week’s Thanksgiving holiday break
with 34 Bcf for Argentina
                                                                                               and expectations that the weather could turn colder.
and 24 Bcf for Brazil.        also to augment Bolivian        to send cargoes up to
                                                                                                  January has now become the front-month contract.
   The latter two countries   shortfalls and its own          Canaport in Canada but
                                                                                               December expired on Tuesday at just below $4.50 per
have now chalked up at        declining domestic              some could stay in the
                                                                                               million British thermal units. January closed on
least one full year of        production.                     region, possibly going into
                                                                                               Wednesday before the holiday at $5.163, up nearly 40
operational activity.            As always, though, the       Sempra’s Costa Azul.             cents on the day and about 45 cents from the same time
   BG Group’s Quintero        most important factor              This is still an adolescent   last week.
LNG terminal in Chile will    driving the trade is pricing    and developing sector, but          Inventory data from the US Energy Information
have done around 20 Bcf       margin.                         arbitrage opportunities          Administration showed a modest increase of 2 billion
of business by the New           Argentina, Brazil and        leveraging price disparities     cubic feet in the latest week to 3.833 trillion cubic feet,
Year, although it only        the DR pay a premium to         between the US and the           about 12% above the five-year average for the time of
kicked off operations in      Henry Hub, which is so          Latin American importers         year and 13% above the same time last year.
July.                         low now that LNG has            are already evident.                Looking ahead, it remains to be seen how the US will
   Puerto Rico and the        become cheaper than its            The region’s volatile         react to big stock market falls internationally after Dubai
Dominican Republic are        local competitor Bolivian       netback differentials will       sought a six-month delay in debt repayments by
expected to have sucked       pipeline gas.                   keep market watchers             state-owned Dubai World and development company
in 22 Bcf and 20 Bcf,            For this reason, Steve       intrigued for a while yet.       Nakheel.



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     The natural way
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     A n t i f e r L n G t e r m i n A L w i L L G i v e Acc e s s f r o m t h e At L A n t i c bA s i n
     to the french network And other mAjor europeAn GAs mArkets




       Firm capacity of 315 GWh/day                       Deep-water harbour of Le Havre-Antifer
       corresponding to an annual capacity                dedicated to hydrocarbon traffic
                                                                                                                                            North Sea
       of some 7 mtpa                                     (existing oil terminal on site)
       Strong support of the French State:                Optimised layout on 30 hectares
       Antifer is the only planned LNG terminal           with very short unloading lines                                                       Rotterdam
       in France to be declared a “Project of Public                                                                        London
                                                          LNG vessels up to Q-Max (265,000 cu.m)                                             Zeebrugge
       Interest” by the French government
                                                          Direct access from open sea without                                        Le Havre Antifer
       Ideally located on the French network,
                                                          channelling or tide restrictions                                                Paris
       close to Paris urban area
                                                          Up to 3 LNG storage tanks of 170,000 cu.m each
       Permits application early November 2009
                                                                                                           Atlantic Ocean
                                                          Wide range of gas qualities without
       Commissioning 2014
                                                          adjustment




     Antifer LNG Terminal 44 rue Washington 75008 Paris France

                               T: +33 170 60 73 81     F: +33 170 60 74 74 marketing@gazdenormandie.com • www.gazdenormandie.com



21www AP GDN.indd 1                                                                                                                                     24/11/09 17:52

								
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