NGS’ NG/LNG SNAPSHOT – May 1-15, 2022
National News Internatonal News
NATIONAL NEWS
City Gas Distribution & Auto LPG
AG&P Pratham to pump in Rs 18,000 crore in city gas distribution
AG&P Pratham, an India arm of Singapore-based AG&P City Gas, is set to invest around Rs 18,000 crore in city gas distribution (CGD) over the next eight years. The company is in talks with multiple suppliers including GAIL India for long-term natural gas supply deals for the southern states.
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The firm is developing 12 CGD networks in India, covering 34 districts. Of the 12 geographical areas that the company has, five are in Karnataka, three in Tamil Nadu, two in Andhra Pradesh and one each in Kerala and Rajasthan. Kerala has already ordered 400 CNG buses to run in the Thiruvananthapuram area.
The company’s CGD networks will include 278,000 square km of land area, 17,000 inch-km of pipeline and over 1,500 new CNG stations. For setting up the pipeline network itself, the investment is expected to be in the range of Rs 1,700 crore. AG&P had already committed an investment of around Rs 2,700 crore over the next eight years in Tamil Nadu to build city gas networks in the districts of Kanchipuram, Chengalpattu, Vellore, Ranipet, Thirupathur and Ramanathapuram. During the 11th round, the PNGRB had offered five GAs, spread across 27 districts in five states. Seven companies had put in 21 bids for areas in states like Uttar Pradesh, Chhattisgarh, Bihar, Jharkhand, and West Bengal.
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New town in Kolkata is likely to get piped natural gas by durga puja this year
Bengal Gas Company Limited (BGCL) is likely to provide piped natural gas (PNG) to the people of New Town around Durga Puja. BGCL is a joint venture company comprising GAIL and Greater Calcutta Gas Supply Corporation Limited.
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Work to lay the underground pipeline in New Town is being carried out in full swing. Work is in progress near City Centre II and areas surrounding Akanshya and Pancha More which fall under Action area II of New Town. Work has begun in Action Area III near Rosedale Garden.
Sh. Debashis Sen, chairman of New Town Kolkata Development Authority (NKDA) said: “Every cooperation is being provided to BGCL and we expect that the people of New Town will get PNG this year.” It was learnt that work in laying underground pipe line near Ruby More in South Kolkata is nearing completion and meters have been installed in some flats at a housing complex off Ruby. BGCL will provide gas to areas in and around Kolkata which include Mukundapur, Taratala, Jadavpur and Tollygunge. City gas Distribution Network (CGD) will be set up and underground piped gas will be supplied in North and South 24 parganas, Howrah, Hooghly and Nadia.
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TN’s first CNG retrofitting station in Coimbatore
In a first in Tamil Nadu, the Indian Oil Corporation Ltd (IOCL) has opened a Compressed Natural Gas kit retrofitting station for heavy vehicles in Coimbatore. The centre will start functioning soon.
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People can modify their petrol vehicles to CNG here. Factory-fitted CNG kits are also available for cars and autorickshaws. If it is not a heavy vehicle (commercial), converting diesel vehicles to CNG will not benefit the owners financially. Despite the benefits of CNG, retrofitting kits in heavy vehicles has not taken off in a big way in TN. CNG kit for diesel heavy vehicles would cost around `3-`5 lakh, stated by Sh. H Suresh, Coimbatore geographical area in-charge of IOCL.
Further, IOCL is planning to open a round-the-clock CNG station, at Pichanur on Kochi-Salem bypass, he added. The IOCL has bagged CNG distribution authority in Coimbatore, Salem, Madurai, Viruthunagar, Theni, Thoothukudi, Kanniyakumari, Tenkasi, Tirunelveli, Dharmapuri, and Krishnagiri districts. Network establishment for distribution is nearing the launching stage in Coimbatore and Salem. The IOCL has also opened a gate station of the City Gas Distribution at Pichanur.
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Piped gas to Cachar homes soon to be a reality in Assam
The Cachar district administration said Oil and Natural Gas Corporation will provide piped gas to homes in the district soon. “ONGC authorities recently said projects are being taken up for supply of LPG gas through pipelines throughout Cachar district in the near future,” said an official communiqué.
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Sources said Silchar, the second largest town in Assam after Guwahati, requires 1 lakh cubic metres of gas per day for a targeted one lakh family.
At present, the facility is available in Sonai town in the southern Assam district. Cooking gas is being supplied through pipelines in this town from ONGC’s plant at Dhanehari Part II near Sonabarighat. “Sonai people are lucky enough to get piped cooking gas.
In the first phase, 100 families of Sonai town were provided piped LPG from that plant and new connections are also being given,” Cachar deputy commissioner Kriti Jalli said while addressing the oath-taking ceremony of Sonai municipal board on Saturday, May 07. A sum of Rs 100 crore have been spent for the construction of project at Dhanehari Part II, which was made functional in 2020 under ONGC’s Assam Arakan Fold Belt Exploratory Asset in Srikona.
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Work on piped natural gas network proceeding slowly in Hubballi, Karnataka
The piped natural gas (PNG) network has often been touted as being a potential gamechanger in India’s energy sector. Unfortunately, despite the initiative’s obvious benefits, the apathetic attitude of the stakeholders involved has resulted in its implementation lagging considerably behind schedule, at least in Hubballi-Dharwad.
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The Indian Oil Adani Gas Private Ltd (IOAGPL), which is entrusted with the responsibility of integrating 21,000 households within the PNG network by 2023 work on the programme started in 2018 has so far been able to connect only 12,800 households to the network. Work on the project was proceeding apace when tragedy struck in the form of Covid-19, which forced a hiatus.
Unfortunately, the project was unable to regain its momentum even after the Covid wave flattened in the district. Thus far, IOAGPL has laid pipelines that cumulatively stretch to a length of 600km. With demand for PNG connection growing across Hubballi-Dharwad, there is a need to expedite work on the project. Deputy general manager for IOAGL Vinod Papal attributed the lag to lack of awareness among the people. The spike in price of petrol and diesel is pushing consumption of compressed natural gas, Sh. Papal said. Papal said that they were facing difficulties in obtaining permission from the civic authorities to dig the ground for laying pipes owing to lack of knowledge among the officials about the benefits of PNG.
“Union minister Sh. Pralhad Joshi, former chief minister Sh. Jagadish Shettar and MLA Sh. Arvind Bellad have helped us get permission to dig up the roads. Thankfully, we do not have to dig up any more roads since we have met our target,” Papal said. Sh. Joshi said that instructions had been given to IOAGL officials to expedite work on the PNG network. He added that he would convene a meeting soon to review the status of the programme.
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Work on piped natural gas network proceeding slowly in Hubballi, Karnataka
The piped natural gas (PNG) network has often been touted as being a potential gamechanger in India’s energy sector. Unfortunately, despite the initiative’s obvious benefits, the apathetic attitude of the stakeholders involved has resulted in its implementation lagging considerably behind schedule, at least in Hubballi-Dharwad.
read more
The Indian Oil Adani Gas Private Ltd (IOAGPL), which is entrusted with the responsibility of integrating 21,000 households within the PNG network by 2023 work on the programme started in 2018 has so far been able to connect only 12,800 households to the network. Work on the project was proceeding apace when tragedy struck in the form of Covid-19, which forced a hiatus.
Unfortunately, the project was unable to regain its momentum even after the Covid wave flattened in the district. Thus far, IOAGPL has laid pipelines that cumulatively stretch to a length of 600km. With demand for PNG connection growing across Hubballi-Dharwad, there is a need to expedite work on the project. Deputy general manager for IOAGL Vinod Papal attributed the lag to lack of awareness among the people. The spike in price of petrol and diesel is pushing consumption of compressed natural gas, Sh. Papal said. Papal said that they were facing difficulties in obtaining permission from the civic authorities to dig the ground for laying pipes owing to lack of knowledge among the officials about the benefits of PNG.
“Union minister Sh. Pralhad Joshi, former chief minister Sh. Jagadish Shettar and MLA Sh. Arvind Bellad have helped us get permission to dig up the roads. Thankfully, we do not have to dig up any more roads since we have met our target,” Papal said. Sh. Joshi said that instructions had been given to IOAGL officials to expedite work on the PNG network. He added that he would convene a meeting soon to review the status of the programme.
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City gas companies seek two-year extension to make up for Covid loss
Total Gas, Torrent, AGP, and other city gas companies have demanded an extension of more than two years from the regulator to complete their promised work programme, citing past Covid restrictions. If the regulator agrees, companies can escape penalties for missing work programme targets and enjoy an extended marketing exclusivity.
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The Petroleum and Natural Gas Regulatory Board (PNGRB) has almost finished hearing companies’ petitions regarding the extension and will likely announce its decision in a fortnight. Companies widely expect the board to accept their demand, according to people familiar with the matter.
Companies have annual targets for laying pipelines, building CNG stations and connecting new piped natural gas (PNG) customers. At the end of each contract year, the regulator can levy a penalty of Rs 750 for each PNG connection shortfall, Rs 150,000 for missing each inch-kilometer of the pipeline, and Rs 20 lakh for each CNG station not built.
In the past two years, most companies have missed these targets, with the worst performance seen in getting new PNG customers, as per people familiar with the matter. Their performance in setting up CNG stations has been much better. City gas companies have traditionally been more focused on CNG, a super-profitable business, than on acquiring PNG customers, which doesn’t fetch much margin.
Companies want PNGRB to waive penalties due to missed targets. City gas companies had declared force majeure soon after the outbreak of the pandemic in early 2020, and sought the extension, citing national and local lockdowns. In November that year, PNGRB approved force majeure and permitted an extension of 129 days to 251 days, including 69 days of nationwide lockdown, varying periods of local lockdowns by states and district authorities, and 60 days for restoration.
Now companies are demanding further extension due to restrictions imposed by the states during the second and third waves of the pandemic. There was no national lockdown after the first wave and state-level restrictions were not too harsh during the second and third waves.
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Natural Gas/ Pipelines/ Company News
ATGL’s revenue from operations at Rs 3,206 crore in FY22, increase of 80%
Ahmedabad, May 5, Adani Total Gas Ltd (ATGL), Indias leading city gas distribution company, on Wednesday announced its operational and financial performance for the fourth quarter and financial year ended March 31. ATGL’s revenue from operations increased by 80% to Rs 3,206 crore with an EBITDA of Rs 815 crore, up by 9%.
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The company reported PBT (profit before tax) of Rs 679 crore, up by 8%, PAT (profit after tax) at Rs 505 crore, up by 7% and consolidated PAT at Rs 510 crore, up by 10%. Among the operational highlights for FY22, the company commissioned 117 new stations. Its number of CNG stations has now increased to 334. ATGL’s footprint has increased to 550 CNG stations along with its JV, IOAGPL. It added 85,840 new connections, while its total PNG home connections surpassed 5.6 lakh mark.
Its industrial and commercial connections increased to 5,676 with 710 new connections. The company completed 5,284 inch km of steel pipeline in new GAs allotted in 9th and 10th rounds. The company’s combined CNG and PNG volume stood at 697 MMSCM, an increase of 35 per cent.
The company board has approved formation of two SPVs for e-mobility and bio businesses. The board has recommended a dividend of 25 per cent of face value of Re 1 each, fully paid up for the FY 2021-22, subject to approval by the shareholders of the company.
https://www.sarkaritel.com/atgls-revenue-from-operations-at-rs-3206-crore-in-fy22-increase-of-80/
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Dr. Pushp Kumar Joshi takes over as CMD of HPCL
Dr. Pushp Kumar Joshi on Sunday, May 08, took over as the new chairman and managing director of India’s third largest oil refining and fuel marketing company Hindustan Petroleum Corporation Ltd (HPCL).
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Prior to this Dr Joshi was Director-HR of the Corporation from August 01, 2012.
Dr. Joshi, the senior-most director on the HPCL board, was in January picked by the government headhunter PESB to replace Mukesh Kumar Surana. Surana superannuated from services on April 30, 2022, but in absence of a formal order from the Appointments Committee of the Cabinet (ACC) headed by the Prime Minister, Dr. Joshi was named interim head.
The ACC confirmation of his appointment has now come and he has formally taken over as the chairman and managing director of HPCL. Joshi is also holding the additional charge of Director-Marketing of HPCL. Dr. Joshi, 58, has been on the board of HPCL for almost a decade now.
He had missed out on being the head of HPCL on previous two occasions – first in August 2013 when Nishi Vasudeva was picked by PESB and again in October 2015 when Surana was selected.
HPCL is also in the process of executing the Visakh Refinery Upgradation Project and greenfield refinery cum petrochemical complex at Barmer, Rajasthan.
https://economictimes.indiatimes.com/news/company/corporate-trends/pushp-kumar-joshi-takes-over-as-cmd-of-hpcl/articleshow/91420089.cms
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Sh. Rakesh Kumar Jain, Director (Finance), GAIL is ‘CFO of the Year’
Sh. Rakesh Kumar Jain, Director (Finance) of GAIL (India) Limited, has been conferred the ‘CFO of the Year Award 2022’ at the Global Refinery & Petrochemicals Congress (2022) and Downstream India Excellence Awards 2022.
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Sh. Jain won the award in recognition of his stellar leadership, pathbreaking initiatives and impressive achievements.
https://www.freepressjournal.in/corporate-gallery/r-k-jain-director-finance-gail-is-cfo-of-the-year
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Natural gas pipelines to Bengaluru, Chengalpattu nearing completion
Two sections of the Ennore-Tiruvallur-Bengaluru-Puducherry-Nagapattinam-Madurai-Thoothukudi natural gas pipeline, from Tiruvallur to Bengaluru (270 km) and Ennore to Chengalpattu (115 km), are nearing completion.
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The line to Bengaluru is a loop line and will supply gas from the Ennore liquid natural gas (LNG) terminal to that city. Once Chengalpattu stretch is commissioned, the supply of R-LNG will commence to industrial consumers at Oragadam and Sriperumbudur.
Sources in Indian Oil Corporation’s pipeline division said the pipelines on most stretches ran as part of the existing lines carrying other petroleum products. Work on the stretches of pipelines to Puducherry, Nagapattinam and Madurai is to be completed by the end of this financial year. Laying of the pipeline began in 2019 at a total cost of ₹6,000 crore, and the stretches from Ramanathapuram to Thoothukudi and Ennore to Manali have been commissioned.
Natural gas is brought to the Ennore terminal, the first on the country’s east coast, by ship in a liquid form at a temperature of minus 160 degrees Celsius. Then it is regassified and supplied to industries and other entities that sell gas for use in vehicles and also supply to homes as piped natural gas. Smaller vehicles use compressed natural gas and bigger vehicles like trucks can use it in the liquid form.
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Policy Matters/ Gas Pricing/ Others
Central Govt modifies gas allocation order, imported LNG to meet rising city gas demand
The oil ministry has modified its gas allocation policy for the city gas sector, allowing state-owned GAIL (India) Ltd to import gas and buy from newer domestic fields to meet growing demand from households and transport sector.
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GAIL will pool or average out the price of imported as well as newer field gas with the lower-priced regulated field gas to supply to city gas entities for sale as CNG to automobiles and piped natural gas to households, a ministry order said.
Till now, city gas entities were allocated natural gas from older fields, called the regulated or APM gas. To promote the sector, the Cabinet had in 2014-15 made city gas a ‘no-cut’ sector, which meant all demand of the sector would be met from domestic fields. But as the demand grew and APM gas production remained stagnant, the ministry modified the allocation policy.
As per the ministry’s May 6 order, gas allocation to city gas will be made on a three-month basis as against the previous policy of six monthly allocations. “Revision of allocation for supply of pooled natural gas to city gas distribution (CGD) entities for CNG and piped natural gas (PNG) segments will be done on a quarterly basis for better representation of consumption,” it said. To meet the growing demand of the sector, GAIL will supply pooled natural gas 2.5 percent over and above the 100 percent requirement of CNG and PNG for household segment of each city in quarterly allocation. To meet the shortfall in the availability of domestic gas, GAIL will source gas from the difficult fields which are priced at a higher rate than APM gas for mixing with available regulated gas, the order.
For any further requirement, GAIL will also source long term LNG failing which spot LNG may be sourced for mixing with available APM gas,” the order said. “The sourcing will be done by GAIL within their procurement procedure and (ministry’s) PPAC shall vet the procurement procedure during finalisation of the uniform base price. For the present quarter, in case long-term LNG is not available, GAIL may procure spot LNG for mixing in the pool, it added. Domestic gas prices are fixed on a six-monthly basis. The APM price for the six months beginning April 1 is USD 6.1 per unit while the same for difficult fields like deepsea is USD 9.92. LNG in the spot or current market is available at triple this price.
The pooled natural gas, including gas from difficult fields and imported LNG will be supplied to CNG and PNG segment. Pooled natural gas will be supplied by GAIL to all city gas entities at a uniform base price arrived at in consultation with PPAC. GAIL will charge a marketing margin on the supply of domestic gas to the city gas segment. At present, GAIL supplies the APM gas to the city gas sector.
Current gas allocation to CNG and PNG sectors is about 18 million standard cubic metres a day while the demand is about 21 mmscmd.
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IGX receives PNGRB permission to commence domestic gas trading
The Indian Gas Exchange (IGX), India’s first authorised Gas Exchange, has received approval from Petroleum and Natural Gas Regulatory Board (PNGRB) to trade domestic gas on its platform. IGX will launch the domestic gas trading starting 16th May 2022.
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This approval is in line with MoPNG’s notification dated 19 August’21 where domestic gas producers were authorised to sell up to 500 million standard cubic meters or 10% of annual production from contract area, whichever is higher, per year through Gas Exchanges. With this approval, upstream gas production of Marketing & Pricing Freedom gas can now be effectively managed through flexible contracts at IGX. With the aforesaid approval, IGX would be able to facilitate trade all Marketing & Pricing Freedom Gas subject to terms and conditions of MoPNG OM dated 19th August’21. IGX is also adding regional hubs and each regional hub will have multiple delivery points to facilitate trade of domestic gas on the Exchange as per amended Gas Exchange Regulations notified on 6th May,22. IGX recently extended the horizon of the monthly contract also from three to six months with effect from 1st April,22.
IGX currently facilitates delivery-based trades in 6 different contracts such as Day-Ahead, Daily, Weekday, Weekly, Fortnightly and Monthly at 5 different designated physical hubs – Dahej, Hazira, Dabhol, Jaigarh and KG Basin.
IGX was established in 2020, as India’s first automated national-level Gas Exchange for physical delivery of natural gas. IGX is a subsidiary of the Indian Energy Exchange Limited, the dominant power trading exchange in the country.
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Price cap for KG-D6 gas to rise in October – Reliance
Reliance Industries (RIL) expects natural gas from its KG-D6 basin to be extremely competitive in the coming months due to firm global gas prices as Europe tries to source gas from sources other than Russia. Sh. Sanjay Roy, senior vice president (exploration and production) said on an analyst call that the company
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expects the price cap for its KG-D6 gas sales to rise over the current $9.92 per million British thermal units to double digits in the next price revision in October this year.
Higher gas prices have boosted RIL’s Ebitda (pre-tax profit) from oil and gas exploration and production business to a seven-year high. Revenue from the segment rose 3.5 times to Rs 7,492 crore in 2021-22 while Ebitda surged 21 fold to Rs 5,457 crore.
Roy observed prices would remain firm given no additional capacity is expected to come on stream until 2026. Europe consumes about 85 million tonne per annum, which amounts to 1% of global supplies. Demand for natural gas is expected to remain strong, and higher production based on KG-D6 field as well as prices will drive value for the business. Reliance and BP, Roy said, currently produce about 20% of India’s total domestic production and the MJ field would raise to 30% in the next 20 months.
After production at the MJ field starts, production is expected to reach 30 mmscmd in 2023. The company is also carrying out exploration activities in block KG-DW1, which is contiguous to KG-D6.Reliance and its partner BP of UK produce about 18 million standard cubic meters per day of gas from two sets of new fields in the eastern offshore deep-sea block KG-D6.
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Plan to monetise IOCL, HPCL & GAIL pipelines loses steam
Finance minister Nirmala Sitharaman in the 2021 Union Budget had announced the monetisation of oil and gas pipeline assets of IOC, GAIL and HPCL. The plan to monetise oil and gas pipeline assets of Indian Oil Corporation (IOCL),
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gas utility GAIL (India) and Hindustan Petroleum Corporation (HPCL) has lost steam due to lack of investor interest and reluctance of the companies to part stake, according to executives and investment bankers.
Following the announcement, the oil companies drafted a blueprint to monetise stakes in their pipeline networks through infrastructure investment trusts (InvITs). The InvITs were to house pipelines totalling 5,000 kilometres, wherein the companies may have offloaded 26-49% of their stakes in these projects.
InvITs act as investment vehicles housing infrastructure projects of companies that allow investors to make small investments and receive regular income. InvITs, popular internationally, are considered stable cash-generation assets, an attribute foreign pension funds look for. Asset monetisation is considered critical not only to attract investment into the infrastructure sector but also for bringing about a paradigm shift in infrastructure augmentation, service delivery and maintenance. The pipeline assets are usually backed by long-term customer relationships, ensuring cash-flow stability.
The operational network of natural gas pipelines in India spans about 16,900 km. An additional 18,363 km of natural gas pipeline network is under construction. Hence, the natural gas grid of India is estimated to expand to 35,263 km in the next three to five years.
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LNG Use / LNG Development and Shipping
India turns to expensive foreign gas to ease its power crisis
Sweltering heat and ongoing blackouts are forcing India’s liquefied natural gas importers to top up with expensive shipments. Torrent Power Ltd. and GAIL India Ltd. bought LNG for May delivery in the last week,
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with the fuel set to be used to help power plants boost generation, according to traders with knowledge of the matter. The utilities paid about triple the normal spot rate for this time of year, as Russia’s invasion of Ukraine exacerbates a global supply crunch.
The purchases are unusual for India’s cost-sensitive power generators, which tend to avoid buying LNG at such high rates. They illustrate how a domestic coal shortage is forcing the South Asian nation to look for alternative fuels no matter the price, further elevating international demand.
While natural gas makes up just a small portion of India’s power mix, a scarcity of coal and hot weather has triggered scheduled blackouts, threatening to upend the economy. Gas was used to produce about 4% of the nation’s electricity in 2020, versus 71% for coal. GAIL is seeking at least one more shipment for late-May, the traders said, adding that several other Indian firms are inquiring about cargoes in the bilateral market.
The heat wave also prompted neighboring Pakistan to purchase the nation’s most expensive shipment of the fuel ever to avoid blackouts during the Eid holiday this week. Cash-strapped Pakistan recently released a tender seeking to purchase another two cargoes for June.
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India buyers grab discounted Russia LNG shunned by rest of world
India’s liquefied natural gas importers are purchasing extra volumes from Russia at a discount as most other spot buyers shun the fuel. Companies including Gujarat State Petroleum Corp. and GAIL India Ltd. recently bought several LNG spot shipments from
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Russia at prices below prevailing market rates, according to traders with knowledge of the matter. They may purchase more as long as the Russian fuel remains cheaper than rival suppliers, the people said, who requested anonymity to discuss private details.
GSPC, GAIL and India’s Ministry of Petroleum and Natural Gas didn’t respond to requests for comment. India gets almost three-quarters of its LNG under long-term contracts, but sweltering heat and ongoing blackouts are forcing the nation’s utilities to top up with spot shipments, which are trading at well above normal due to a global supply crunch. With demand for gas in the fertilizer sector also rising, some importers are snapping up the discounted Russian shipments.
The Russian LNG shipments were purchased by Indian firms via recent spot tenders, as those cargoes were offered at lower prices than other suppliers, the people said. Outside of India, few LNG importers allow for suppliers to offer Russia-origin shipments in purchase tenders. The South Asian nation, which is also seeking deeper discounts on Russian oil, has emerged as a last resort for Russian fuels traded on the spot market and shunned by the world due to President Vladimir Putin’s invasion of Ukraine.
There are no direct sanctions on LNG, but top buyers including Japan and South Korea have halted purchases to avoid future penalties or reputational damage and PetroChina Co. said on Friday that it isn’t seeking any discounted Russian spot supply. While additional spot LNG shipments are being avoided, most Russian deliveries under long-term contracts are still being accepted by customers around the world.
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Hyundai Motor installing LNG power plant for self-sufficiency in power for auto factories
Hyundai Motor will install a large-scale liquefied natural gas (LNG) power generator at its Ulsan plant to self-supply 70 percent of the power needed to run its main vehicle production base in Korea. According to sources familiar with the matter, the carmaker is tapping opinions of residents with its outline on building a power plant in Ulsan complex.
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The carmaker aims to build an LNG-fueled power plant with capacity of 184 MW, including 21.6 MW for emergency use, which is enough to cover 72 percent of annual power Ulsan factory lines use. The cogeneration plant for electricity and heating will produce 100 tons of steam per hour. Hyundai plans to build the plant equipped with two gas turbines and one steam turbine immediately after it gains government’s environment-related clearance for operation from 2025.
The power generator within auto production base will be the company’s first and a rare move among automakers. The endeavor is as apart of its goal to cut carbon emission as well as ensuring stable power security. The government has been encouraging self-sufficiency in power sourcing by major manufacturers for state carbon goals. The power plant addition also can add to the environment score for Hyundai Motor as LNG remains as a part of the green taxonomy.
https://pulsenews.co.kr/view.php?year=2022&no=407803
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Petronet in talks with Qatar for LNG deal renewal amid turbulent markets
India’s Petronet LNG has begun talks with Qatar to renew a multi-year gas deal despite market “turbulence”, making new long-term contracts difficult as sanctions on Russian fuel have squeezed an already tightly supplied market. India’s top gas importer has till end-2023 to renew its long-term liquefied natural gas
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(LNG) deal with Qatar Gas to beyond 2028, its head of finance Sh. Vinod Kumar Mishra told an analyst call after the Petronet announced quarterly earnings.
He said it was not a “perfect environment” to initiate new long-term deals as market was tight and European companies were aggressively scouting for contracts to cut dependence on Russia after Moscow’s invasion of Ukraine. Qatar is already in talks with Germany for long-term gas supplies, helping Europe’s biggest economy cut dependence on Russian energy sources.
Petronet, however, hopes Qatar would lower gas prices for India, mirroring contracts signed with Bangladesh, Pakistan and China, where prices are linked to a slope of 10.2% of the Brent crude. In contrast, India’s existing LNG deal with Qatar is based on a slope of about 12.67% of the Brent price.
Due to high spot LNG prices some Indian customers have switched to alternative fuels, he said. India’s gas demand is set to surge as Prime Minister Narendra Modi aims to raise the share of natural gas in the country’s energy mix to 15% from 6.7%. Sh. Mishra said recent government decision mandating GAIL (India) Ltd to import gas for meeting rising demand from transport and households sector would help increase utilisation of capacity at its terminals and raise the company’s revenue.
Earlier in the day, Petronet’s chief executive A.K. Singh also said Petronet is looking for 0.75-1 million tonne of LNG in immediate term to meet the rising demand.
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Electric Mobility/ Hydrogen/ Bio- Methane
Brookfield-backed PIL, GAIL sign initial pact for hydrogen collaboration
Brookfield Asset Management-based Pipeline Infrastructure Ltd has signed a pact with state-owned GAIL for jointly developing a hydrogen-based ecosystem in India. The MoU aims at collectively exploring the feasibility, desirability and viability of hydrogen as a source of energy and thus build a partnership between the companies, PIL is owned by India Infrastructure
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Trust, an infrastructure investment trust sponsored by Brookfield Asset Management, a global leader in alternative asset management and one of the largest investors in real assets.
PIL owns and operates a 48-inch diameter, 1,480 km long Kakinada to Bharuch gas pipeline that connects major domestic supply hubs on the east to key demand centers in the west. It is a vital link in India’s national gas grid. GAIL is India’s largest gas transporting and marketing company. It owns about two-thirds of truck pipelines.
Pipelines are a critical element in transporting hydrogen, a zero-carbon emitting energy source that has caught the fancy of the world. Several Indian firms including GAIL have announced plans to make hydrogen.
Smt. Aayushi Agarwal, Assistant Vice President (Strategic Planning & New Initiatives), PIL and Sh. Ashu Singhal, Executive Director, GAIL signed the MoU in the presence of PIL CEO Sh. Akhil Mehrotra and GAIL Director (Business Development) Sh. M V Iyer.
PIL and GAIL will explore various options for transportation, using the existing natural gas pipeline and the end-use of hydrogen, they said. India as a nation is at a very nascent stage with respect to hydrogen as an energy source. The focus at this time should be on exploring the production, transmission, and distribution of hydrogen for making it viable to be able to contribute towards fulfilling India’s COP26 commitment.
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Natural Gas SME set to invest Rs 600 crore in biogas business
Enertech Fuel Solutions, a small and medium enterprise based in Ahmedabad is all set to invest Rs 600 crore for its foray into the compressed biogas (CBG) business, the company announced on Tuesday.
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The announcement was made on the sidelines of the inauguration of Enertech’s new office premises in the city by minister of state for energy, the government of Gujarat, Mukesh Patel.
Sh. Badri Mahapatra, promoter of the firm said, “The investment will be made next year for a pan-India presence in the CBG business. Given our extensive experience in the natural gas business, foraying into the CBG business is a natural extension. We plan to establish 10 CBG plants in a year.” “In the first phase, we will establish four CBG plants in Gujarat, Uttar Pradesh, Punjab, and Haryana. In the second phase, we will invest one more plant in each of these states, while adding two more plants in Madhya Pradesh,” said Sh. Mahapatra.
In Gujarat, Enertech has zeroed in on Mehsana for setting up a CBG plant. Biogas is produced from waste/biomass sources such as agricultural residue, cattle dung, municipal solid waste, sewage treatment plant waste, among others through the process of anaerobic decomposition. The biogas is purified to remove hydrogen sulphide, carbon dioxide, water vapour and compressed as CBG. CBG has calorific value and other properties like CNG and can be used as a green renewable automotive fuel.
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Mahindra Electric Mobility moves 2 divisions to Bengaluru
Mahindra Electric Mobility on Wednesday, May 11, said it has moved the offices of its two divisions, Last Mile Mobility (LMM) and EV Technology Centre (EVTEC), to new premises at technology hub in Bengaluru.
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The Mahindra Group’s electric vehicle arm also said that it will continue to have a fully functional office at Kandivali suburb in Mumbai while the Innovation Centre as well as the Bomassandra plant staff will continue to operate from their respective locations in Bengaluru.
The new office, with more than 500 people’ seating capacity, is in line with Mahindra Electric Mobility Ltd (MEML)’s expansion strategy and creating an exciting workspace for its employees, the company said.
The new office will be able to house the entire workforce of EVTEC and certain functions of LMM, the company said, adding, from April 1, employees have started the work-from-office format, following necessary COVID-19 protocols, the company said.
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HOP Electric Mobility in talks to raise $10 million to strengthen its portfolio
Electric mobility solutions provider HOP Electric Mobility is in talks to raise $10 million to strengthen its product portfolio and manufacturing footprint in the country.
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The company – which has already received the first infusion of $ 2.6 million from a publicly listed strategic investor – expects to close the series A funding round in the next six months. “The resources will be utilised to expand its product portfolio and fortify backward integration of the supply chain to enable indigenous manufacturing of critical components such as cells, motors and controllers”, Sh. Ketan Mehta, Founder & CEO, HOP Electric Mobility told ET.
HOP Electric Mobility, a diversified business venture of Rays Power Infra, is one of the three new non-automotive investors to qualify under the production linked incentive scheme for OEMs earlier this year.
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SUN Mobility partners with Greaves Electric Mobility for swappable battery
Leading energy infrastructure and electric vehicles service provider SUN Mobility on Tuesday, May 10, signed a memorandum of understanding (MoU) with Greaves Electric Mobility (GEM) to work together and evaluate the best possible solution for the EV customer in the battery swapping segment.
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As part of this partnership, GEM and Sun Mobility will deploy swappable batteries for electric vehicles in the country, a joint statement said. With the government and key industry players recognizing Battery-as-a-Service to accelerate EV adoption, this partnership aims to further bolster EV adoption in India in the electric twowheelers and three-wheelers categories by utilizing the same charging infrastructure.
Through Greaves Electric Mobility, we aim to strengthen our leadership position in the electric vehicle segment and provide the best and affordable last-mile connectivity experience to our large number of customers across the country.
Together with SUN Mobility, we would be addressing one of the critical elements in EV adoption in terms of range anxiety and providing an uninterrupted journey,” Ram Rajappa, Chief Technology Officer, Greaves Electric Mobility, said.
GEM has a range of electric vehicles across two-wheelers, three-wheelers, erickshaws, and e-loaders (across brands like Ampere, Ele, MLR Auto). The SUN Mobility platform would address all these vehicles using 1/2/3/4 batteries, giving customers a one-stop solution on probably the world’s first truly interoperable platform. With SUN Mobility’s industry-leading battery technology, GEM aims to use the infrastructure and battery for both electric two-wheelers and three-wheelers.
According to SUN Mobility, its Quick Interchange Station network, which is spread across 14 cities, will make it easy for GEM to quickly roll this solution nationwide.
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INTERNATIONAL NEWS
Natural Gas / Transnational Pipelines/ Others
USA: Natural gas production in Appalachia driving U.S. production in 2021
A new report from the U.S. Energy Information Administration shows that Appalachia is one of three natural gas producing areas driving production increases in 2021. According to the Drilling Productivity Report, Monthly Crude Oil and Natural Gas Production Report, three areas – Appalachia, Permian, and Haynesville, accounted for 59 percent of gross withdrawals in 2021, compared to 24 percent in 2011.
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Across the U.S., natural gas production increased 2 percent and reached 118.8 billion cubic feet per day (Bcf/d) on a monthly basis in December 2021, the highest on record. In Appalachia, natural gas production grew by 1.9 Bcf/d to 35.9 Bcf/d in 2021. The report credited production growth over the past decade to improved productivity from wells drills, pipeline buildout, and increased takeaway capacity. The report said regional transportation capacity limits have been reached, however.
In the Permian region in western Texas and eastern New Mexico, production grew by 1.4 Bcf/d to 18.3 Bcf/d. That region also saw a growth in associated gas production (natural gas produced from oil wells).
And in the Haynesville region in Louisiana and Texas, production grew by 1.4 Bcf/d to 13.2 Bcf/d. The report showed that while that region saw producers drilling deeper and more expensive wells, relatively high natural gas prices during 2021 made the drilling still economical. Higher costs, the report said, have been offset by the region’s well productivity and its proximity to the Gulf Coast, where natural gas demand has been growing rapidly.
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USA: LNG demand driving Williams’ $1.5B investment in natural gas pipeline expansions
Midstream giant Williams is spending about $1.5 billion to grow its natural gas transportation capacity by nearly 2 Bcf/d over the next few years to accommodate growing demand, particularly for exports, according to management.
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One of the six transmission projects the Tulsa-based midstreamer is developing is a 364 MMcf/d expansion on the Transcontinental Gas Pipe Line Co. (Transco) system, the country’s largest gas system. Williams management said Tuesday it has secured customer commitments for the Texas to Louisiana Energy Pathway Project to serve liquefied natural gas (LNG) demand. It is targeting an in-service for the expansion by the end of 2025.
Management cited ongoing demand for transportation capacity on the Transco system, not only for LNG but also power and industrial sectors. On the 1Q2022 earnings call, CFO John Porter said average daily transmission volumes for Transco increased by more than 6% year/year amid record winter demand. Transco revenues, he said, are driven by reserve capacity not throughput, “but continued growth in actual throughput does highlight the criticality of Transco service.”
The higher gas price environment has done little to deter demand, according to Porter. Admittedly, it has been somewhat surprising to us how inelastic this demand has remained.
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Canada: Coastal GasLink natural gas pipeline nears 65% completion
Two of eight sections of the 670-kilometre long Coastal GasLink natural gas pipeline are built, and the project overall is reaching the 65% completion mark, according to a project update.
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But just how far behind schedule, how much over budget the project will be, and who will cover the cost overrun remains unclear. TC Energy Corp. (TSX:TRP) and LNG Canada are still wrangling over the question of who should cover the additional costs. As part of its update, CGL announced that O.J. Pipelines, one of the project’s contractors, has partnered with three local First Nations development corporations to build Section 7. The three First Nations corporations are Natanlii Development Corp. (Skin Tyee Nation), Yinka Dene Economic Development Limited Partnership (Wet’suwet’en First Nation) and Kyah Development Corp. (Witset First Nation).
All three communities are part of the Wet’suwet’en First Nation. All elected band councils within the Wet’suwet’en First Nation support the pipeline project and have benefits agreements with CGL and the provincial government. CGL reports that 96% of the pipeline corridor has been cleared. In all other sections, 30% to 60% of the pipe is laid, except for sections 1 and 4, where 100% of the pipe is now in the ground.
https://biv.com/article/2022/05/coastal-gaslink-natural-gas-pipeline-nears-65-completion
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Spain’s Enagás confirms renewed work on natural gas interconnect with France
Enagás SA, Spain’s transmission system operator (TSO), has renewed talks to create more natural gas pipeline infrastructure between France and Spain in the wake of Russia’s invasion of Ukraine. CEO Arturo Gonzalo said during a first quarter earnings call the company is “working closely” with its French TSO counterpart,
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Teréga SAS, to propose an additional interconnection between the countries. If approved by regulators, the project could revive the Midi-Catalonia Pipeline project, or MidCat, that was canceled in 2019 after French regulators ruled it wasn’t financially viable.
Gonzalo said the continued work on the interconnection wasn’t the result of changing policies by any one country or regulator, but an entirely different dynamic for the Western European energy system.
Spain currently has six regasification terminals and has been trying to procure more capacity with floating storage and regasification units.
Enagás also reported that 70% of Spain’s gas supply came from imported liquefied natural gas during 1Q2022. U.S. producers accounted for the majority of the volumes with 37%. While Spain has most of Europe’s spare regasification capacity, it also lacks adequate pipeline infrastructure to move gas to the rest of Europe.
As Europe has looked to diversify its supplies and refill inventories, prices have remained elevated and attracted an influx of LNG cargoes. In January and February, more than 70% of U.S. LNG exports went to Europe, according to NGI calculations. More regasification capacity and infrastructure to move gas from Southern to Northern Europe could help the continent bring in additional supplies.
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Natural Gas / LNG Utilization
LNG tanker to arrive at Norwegian LNG plant after 20-month outage
Liquefied natural gas (LNG) tanker Arctic Voyager has arrived at Norway’s Hammerfest terminal on May 12. Europe’s only large-scale LNG plant, at Melkoeya island outside the Arctic town of Hammerfest, is scheduled to resume production on May 17 following a 20-month outage.
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The plant, which can process 18 million cubic metres (mcm) of gas per day, has been out of service since September 2020 following a blaze that raised concerns over safety practices. At Melkoeya, gas is piped in from the offshore Snoehvit field, 160 km (100 miles) away in the Barents Sea. The field was forced to shut as a result of the plant’s closure.
https://gcaptain.com/norway-hammerfest-lng-plant-restart/
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As of 2021, China imports more LNG than any other country, became largest consumer
In 2021, China imported more liquefied natural gas (LNG) than any other country, according to data from Global Trade Tracker and China’s General Administration of Customs. Prior to 2021, Japan had been the world’s largest LNG importer for decades, according to data from Cedigaz.
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China’s LNG imports averaged 10.5 billion cubic feet per day (Bcf/d), a 19% increase compared with 2020. LNG imports accounted for more than half of China’s overall natural gas imports and 30% of China’s total natural gas supply in 2021.
China began importing LNG in 2006 and, with the exception of 2015, has imported more LNG each year since then. China has rapidly expanded its LNG import capacity, which was estimated at 13.9 Bcf/d in 2021. By the end of 2022, China’s regasification capacity could increase by 2.8 Bcf/d to 16.7 Bcf/d, according to data by S&P Global Platts. In 2021, China imported LNG from 25 countries. The largest six suppliers—Australia, United States, Qatar, Malaysia, Indonesia, and Russia—provided 8.9 Bcf/d, or 85%, of China’s total LNG imports.
Since China lowered tariffs on LNG imports from the United States from 25% to 10% in 2019, U.S. LNG exports to China have increased and in 2021 averaged 1.2 Bcf/d. The United States was the largest supplier of spot LNG volumes to China last year.
During 2022 and 2023, several new long-term contracts between China and the United States are expected to start from the Sabine Pass and Corpus Christi terminals for a combined estimated volume of up to 0.5 Bcf/d. The new U.S. LNG export terminal at Calcasieu Pass will supply China’s two national energy companies—Sinopec with 0.13 Bcf/d and CNOOC with 0.2 Bcf/d—starting next year.
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Argentine government signs deal to switch heavy fleets to natural gas
The Ministry of Transportation oand the National Gas Regulatory Entity (Enargas), headed by Alexis Guerrera and Federico Bernal respectively, signed a cooperation agreement, as established by Law No. 24,076, which fundamentally aims to promote the transformation to natural gas of cargo and passengers transportation.
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It should be noted that Enargas is projecting “green corridors” for the refueling of truck and bus fleets powered by CNG, and that it also issued the “Procedure for the authorization of imported vehicles, propelled by natural gas” and the “authorization of vehicles produced in national territory, propelled by natural gas”.
The energy transition project for public passenger transport has as fundamental objectives the reduction of the domestic preponderance of internal combustion engines based on hydrocarbons (fossil fuels) to go towards electric engines, as well as reducing in the transition, the consumption of most common and polluting hydrocarbons (gasoline, diesel) through the development and promotion of integrated policies and plans to promote inclusion, efficient use of resources, mitigation and adaptation to climate change.
That is why the Ministry of Transport of the Nation contacted Enargas and the Argentine Chamber of CNG, who assure that the supply and technological conditions are in place to cover an initial demand for CNG provision for public passenger transport.
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U.S. Department of Energy approves additional natural gas exports from Louisiana, Texas
The U.S. Department of Energy recently approved additional natural gas exports from facilities based in Texas and Louisiana. The Energy Department issued orders allowing the Magnolia Liquefied Natural Gas Terminal in Lake Charles to export additional LNG to any country not prohibited by U.S. law or policy, The Associated Press reports.
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The authorization issued on April 27 also included the Golden Pass LNG Terminal near Port Austin, Texas. The Golden Pass facility is expected to be in operation in 2024, while the Magnolia plant will start in 2026. Combined, the two terminals are expected to produce more than 3 billion cubic feet of natural gas per day, according to the news wire. U.S. Rep. Garret Graves, R-La., said the approval from the energy department will help address trade imbalances with foreign nations while simultaneously benefitting the U.S. and Louisiana, the nation’s top exporting state for natural gas.
The new permits for the Texas and Louisiana facilities follow similar approvals for two other LNG terminals in those state last month. The Golden Pass terminal is a $10 billion joint project owned by ExxonMobil Corporation and Qatar Petroleum International Limited, while the Magnolia facility in Lake Charles is owned by Glenfarne Group, LLC, the AP reports.
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Global LNG Development
Germany looks to rapidly build LNG import terminals to shift away from Russian gas
With the war in Ukraine raging on, German Vice Chancellor Robert Habeck is calling for a rapid buildout of liquefied natural gas (LNG) terminals to help the country source more gas from overseas suppliers and wean off Russian imports, which currently account for around a third of Germany’s natural gas.
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The German government, which says it could back an EU embargo on Russian oil by the end of this year, is aiming to wean off Russian natural gas by mid-2024. Habeck has previously called for building new terminals at “Tesla speeds,” in reference to the Tesla Gigafactory in Berlin, which was erected in just two years. To meet that timeline, Tesla began construction before receiving every permit, an approach that Habeck is now championing for liquefied natural gas.
In total, the German government is looking to build more than 68 billion cubic meters of import capacity, well more than the 40 billion cubic meters of gas imported from Russia last year.
Habeck, a member of the Green party, has faced criticism from environmentalists over his LNG push, which runs contrary to his efforts to curb climate change. A buildout of new LNG terminals risks further entrenching natural gas, critics say. A recent analysis found that, by ramping up clean energy and energy efficiency, the EU could end imports of Russian natural gas by 2025 without building any new gas infrastructure.
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USA Energy transfer, Gunvor ink LNG sale deal
US midstream company Energy Transfer and commodity trading house Gunvor said on May 02 they had entered into a sale and purchase agreement (SPA) under which Gunvor will take 2mn mt/yr of LNG from Energy Transfer LNG’s proposed Lake Charles project in Louisiana.
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The term of the SPA is 20 years and provides for the sale of LNG on a free-on-board basis, indexed to the Henry Hub benchmark price plus a fixed liquefaction charge. First deliveries could start as soon as 2026, pending a final investment decision (FID) on the 16.45mn mt/yr Lake Charles LNG project, a brownfield investment to convert an existing LNG import and regasification facility.
Energy Transfer LNG president Tom Mason said Gunvor’s commitment to Lake Charles “further evidences the progress we are making towards taking FID by year-end.”
https://www.naturalgasworld.com/energy-transfer-gunvor-ink-lng-sale-deal-97958
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Europe’s Engie Buys More U.S. LNG With Green Credentials
NextDecade Corp. gained the most in more than two weeks after French utility Engie SA agreed to buy liquefied natural gas from its proposed export terminal in Texas. Under the deal, Engie will purchase an annual 1.75 million metric tons of the super-chilled fuel produced at the Rio Grande LNG export project for 15 years.
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The pact marks a U-turn for the European powerhouse, which less than two years ago scrapped plans to buy LNG from the same project. It comes at a time when Europe is trying to eliminate its reliance on Russian gas, and after NextDecade committed to slash most of the emissions associated with the terminal.
Engie’s 2020 decision to drop a $7 billion deal with NextDecade came amid pressure from an environmental group and was a major pushback for the American gas industry. Suppliers have since stepped up efforts to reassure European consumers of their green credentials including by tracking and slashing emissions of methane, a powerful greenhouse gas.
NextDecade aims to reduce carbon emissions from the Rio Grande project by more than 90% via carbon capture and storage while relying on so-called responsibly sourced gas and the use of net-zero power to produce a lower carbon-intensive LNG. While carbon capture and storage is seen as a key emissions reduction technology, it has yet to be proven economically viable on a large scale.
Engie had also agreed to purchase some LNG from Cheniere Energy Inc., the largest U.S. exporter of natural gas, provided that the company discloses the carbon intensity of every cargo it sells and quantifies emissions starting from the wellhead.
NextDecade said it should make a positive final investment decision on a minimum of two trains of the Rio Grande LNG export project in the second half of 2022, pending the achievement of further LNG contracting and financing. The first train is expected to start commercial operations as early as 2026.
https://finance.yahoo.com/news/europes-engie-buys-more-u-134032328.html
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Vietnam’s Sovico signs LNG pact with Jera
Vietnamese investment group Sovico Corporation has signed a cooperation agreement with Japanese joint venture Jera to evaluate the potential of supplying LNG to power projects in Vietnam, it said on May 03. Sovico and
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Jera, a joint venture between Japanese utilities Tepco and Chubu Electric, also intend to jointly develop a gas-based power plant project in the southeast Asian country.
Jera in March established its Vietnamese subsidiary, Jera Energy Vietnam Co. The company will be responsible for furthering the LNG-to-power projects in the country that are now under consideration, as well as for exploring new projects, including those in renewable energy. The southeast Asian nation is promoting gas-fired power as it moves away from coal and oil-based generation.
https://www.naturalgasworld.com/vietnams-sovico-signs-lng-pact-with-jera-97970
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Long-term U.S.A LNG deals pick up as demand increases
Long-term liquefied natural gas (LNG) contracts ramped up further as sanctions on Russian fuel squeeze an already tightly supplied market and increase global demand for U.S. LNG. Pipeline and terminal operator Energy Transfer LP and LNG developer NextDecade Corp both announced new LNG supply agreements on Monday for customers in Europe and Asia.
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The U.S. has committed to deliver additional LNG to European countries to contribute to slashing gas imports from Russia following its invasion of Ukraine. Energy Transfer said its LNG unit has agreed to supply 2 million tonnes per annum (mtpa) of LNG from its proposed Lake Charles, Louisiana, project to the Singapore unit of trading house Gunvor Group Ltd. The supply deal is for 20 years and first deliveries are expected to begin in 2026, the U.S. pipeline company added.
The companies did not disclose the purchase price, but said it is indexed to the Henry Hub benchmark plus a fixed liquefaction charge. NextDecade signed a 15-year supply agreement with French energy group Engie SA for 1.75 mtpa of LNG. The LNG will be supplied from NextDecade’s Rio Grande LNG export project in Brownsville, Texas, and first deliveries are expected to begin in 2026, the company said. The companies did not disclose the purchase price.
https://www.hellenicshippingnews.com/long-term-u-s-lng-deals-pick-up-as-demand-increases/
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Official launch of works on Alexandroupolis LNG terminal in Greece
Works on Alexandroupolis LNG terminal, a significant project for the energy security of Southeastern Europe and the Balkans, were officially launched on May 04, in Alexandroupolis, Greece. The terminal is expected to be operational in December 2023.
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Present at a ceremony in Alexandroupolis were the prime minister of Greece, Kyriakos Mitsotakis, Bulgaria’s prime minister, Kiril Petkov, Serbia’s president, Aleksandar Vučić, North Macedonia’s prime minister, Dimitar Kovačevski, representatives of the operating company, Gastrade, ministers and parliamentarians, as well as Charles Michel, President of the European Council.
Greek Prime Minister Kyriakos Mitsotakis said during the ceremony that the Alexandroupolis FSRU is a floating LNG terminal that will provide 5.5 billion cubic meters (bcm) of natural gas annually when completed to the markets of Greece, Bulgaria, Serbia and North Macedonia.
The new infrastructure is tied to other interconnection projects, such as the Gas Interconnector Greece-Bulgaria (IGB) that will be operational from September 2022, but also the important gas links between Bulgaria, North Macedonia and Serbia. Through these recent and new projects, these countries will be able to reduce their dependence on Russian natural gas by diversifying their routes and sources of supply.
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Qatar tops US to become world’s largest LNG exporter
The Gulf nation leads in LNG exports as the country looks to replace Europe’s energy supply after Russia’s invasion of Ukraine. Qatar has reclaimed its title as the world’s top liquefied natural gas [LNG] exporter, Bloomberg reported, after lowered winter demand took the US down to the second place.
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In April, the Gulf nation’s LNG exports surpassed 7.5 million metric tons, clinching the title from the U.S, according to ship-tracking data compiled by Bloomberg.
The Gulf state previously maintained its dominance in LNG exports before maintenance at Qatar Gas caused a reduction in the exports a month earlier. In 2019, the Middle Eastern nation was also on top of the list with exportation that amounted to 104.8 billion cubic meters (bcm) of LNG, according to BP’s Statistical Review of World Energy 2019 report. Over the last few months, several European countries have eyed Qatar as an LNG importer as part of an attempt to cut dependence on Russian energy as a response to its invasion of Ukraine.
Low temperatures and high demand has spiked the prices of fuel globally. European gas prices rose by as much as 20% as a result of the move before levelling out. As payment deadlines approach, governments and businesses throughout Europe must decide whether to comply with the new regulations or risk potential gas rationing.
Both leading LNG exporters are expected to compete to dominate the market of global gas energy after their major expansion projects are fully completed. Qatar is planning a gargantuan export project that is set to be completed soon and is expected to keep the nation as the top exporter.
Meanwhile, Golden Pass LNG, a liquefied natural gas project being built in Texas by QatarEnergy, Exxon Mobil Corporation, and Glenfarne Group LLC’s Magnolia LNG project in Louisiana is expected to take U.S’s LNG production capacity to 13.9 billion cubic feet of natural gas per day.
https://dohanews.co/qatar-tops-us-to-become-worlds-largest-lng-exporter/
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USA: Cheniere signs natural gas deal for Corpus Christi LNG
U.S. LNG export project developer Cheniere Energy has signed a long-term IPM gas supply deal with Canadian natural gas producer ARC Resources for its Corpus Christi LNG Stage 3 project. On 4 May, Cheniere announced today that its subsidiary Corpus Christi Liquefaction Stage I
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II has entered into a long-term integrated production marketing (IPM) gas supply agreement with ARC U.S., a subsidiary of ARC Resources.
Under the IPM, ARC U.S. will sell 140,000 MMBtu per day of natural gas to Corpus Christi Stage III for a term of 15 years, starting with commercial operations of Train 7 of Corpus Christi Stage III project.
Cheniere will market the LNG associated with this gas supply, approximately 0.85 million tonnes per annum (MTPA). It will pay ARC U.S. an LNG-linked price for its gas, based on the Platts Japan Korea Marker (JKM), after deductions for fixed LNG shipping costs and a fixed liquefaction fee.
ARC Resources will act as guarantor of the IPM agreement on behalf of ARC U.S. The IPM agreement is subject to Corpus Christi Stage III making a positive final investment decision.
https://www.offshore-energy.biz/cheniere-signs-natural-gas-deal-for-corpus-christi-lng/
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Sempra pushing forward Mexican LNG projects with solid govt backing
Executives of San Diego-based Sempra Energy gave an update of a raft of projects focused on LNG in Mexico during a 1Q22 results call with investors. Sempra CEO Jeff Martin gave new details of projects under development in the country, including
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Energía Costa Azul (ECA) Phase 1 and Phase 2 in Baja California state, as well as the Vista Pacífico project for the Topolobampo liquid fuels marine terminal in Sinaloa state, both on the Pacific coast.
While Martin said executing a final investment decision on ECA Phase 1 was now Sempra’s “top priority” among all projects, he said the Mexican government is also eager to advance with Vista Pacífico. AMLO’s administration has come under fire in recent times for its insistence on expanding use of hydrocarbons for power generation, but the view of natural gas as the cleanest alternative in the hydrocarbon space has fueled the government’s desire to back projects in this area, as well as showing particular interest in LNG.
Being built at the existing Energía Costa Azul LNG regasification facility (pictured), ECA Phase 1 is set to be the first Pacific coast LNG export project with direct access to abundant natural gas supplies in Texas and the Western US as a single-train liquefaction facility with a nameplate capacity of 3.25Mt/y (million tons per year) of LNG and an initial offtake capacity of approximately 2.5Mt/y of LNG.
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Germany commits $3B to launch LNG imports chartering four FSRUs
Seeking to further reduce its reliance on Russian natural gas imports, the German federal government has signed agreements with energy giants RWE and Uniper to launch the country’s first liquified natural gas import terminals.
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Expected to be online for the 2022-2023 winter season, the four FSRU units will provide a fifth of Germany’s needs for gas and provide the basis for the development of a long-term LNG import infrastructure.
Russia exported 142 billion cubic meters of natural gas via pipelines into Europe in 2021 with Germany being one of the largest users consuming approximately a total of 95 billion cubic meters of gas per year. Approximately half of Germany’s LNG supply was being imported from Russia but since the invasion of Ukraine, Germany has been working to develop its strategy and diversify its supply of LNG. The minister said that they have already reduced the use of Russian LNG, estimated by experts to around 35 percent, and Germany had previously said it would reduce Russian LNG to 10 percent of its supply by 2024.
The first of the two agreements announced today is with Uniper with the company reporting it will invest around €65 million ($68.5 million) to build and operate LNG terminals for the federal government. The project is in two phases, designed to get the first FSRU operational this year and then support a permanent and expanded terminal for FSRU operations and unloading and handling facilities for green gases such as ammonia.
In the second agreement, the federal government has also reached terms with RWE to charter two additional FSRU units. The plan is for the FSRU platform to start operating as early as next winter with RWE having operational responsibility. Both vessels are owned by Höegh LNG, which will also handle technical operations.
The next step is to determine which unloading sites are suitable. RWE reported that Wilhelmshaven, Brunsbüttel, Rostock and Stade are under consideration. The 10-year deal for the two Höegh FSRUs managed by RWE is expected to be completed by September or October of this year. Combined the four FSRU units once operational are expected to supply Germany with at least 20 billion cubic meters of LNG annually.
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LNG as a Marine Fuel/Shipping
NYK, CNOOC sign long-term charters for six LNG carriers
Japanese shipping and logistics firm NYK has signed a long-term time-charter contract with CNOOC Gas and Power Singapore Trading & Marketing Pte. Ltd. for six liquefied natural gas (LNG) carriers, in addition to a shipbuilding contract for the vessels with Hudong-Zhonghua Shipbuilding (Group) Co. Ltd.
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This is NYK’s first long-term time-charter contract for an LNG carrier with CNOOC. The six vessels are scheduled to be delivered between 2026 and 2027 and will be mainly engaged in LNG transportation to China.
NYK has also signed a project head of agreement with a subsidiary of China Merchants Energy Shipping Co. Ltd (CMES), a Chinese shipping company, to jointly own and manage the vessels.
The LNG carriers will be equipped with an X-DF2.1 iCER, a next-generation dual-fuel engine that can operate on fuel oil or boil off gas stored in its cargo tank. The vessels will each have a cargo tank capacity of about 174,000 cubic meters and a membrane-type tank that will make use of advanced insulating materials to reduce the boil-off rate – a percentage of gas volume that vaporizes during navigation.
https://www.marinelink.com/news/nyk-cnooc-sign-longterm-charters-six-lng-496191
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Rising LNG-powered vessel in the maritime industry
Liquefied natural gas (LNG) is now the most common propulsion option for container shipping companies, with LNG-powered dual-fuel ships comprising 25 percent of the total orderbook after a massive increase in orders over the past year.
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The number of LNG-fueled ships currently on order has risen to 138 vessels with a capacity of 1.67 million TEU, up from 50 ships of 720,000 TEU capacity a year ago, according to maritime consultancy Alphaliner. Most of those vessels will enter the market in 2023 and 2024.
The maritime industry is under enormous pressure to reduce its carbon dioxide (CO2) emissions, and with no viable alternatives yet to fossil fuels available at the scale required, several major carriers are placing their bets on LNG as a transitionary fuel until a zero-carbon option is developed. Switching to LNG also allows carriers to reduce harmful emissions in line with toughening regulatory requirements. CMA CGM Group has 80 percent of its owned and chartered orderbook dedicated to LNG propulsion.
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China’s CNOOC awards US$2.4 billion LNG tanker building contracts
China National Offshore Oil Co (CNOOC) has awarded 16 billion yuan (US$2.42 billion) worth of contracts to build 12 liquefied natural gas (LNG) tankers, the largest of their kind in the country on May 05. China is the world’s largest buyer of the super-chilled gas,
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while CNOOC is the country’s largest importer of the fuel and among the state majors leading a drive to expand their LNG fleet to meet rising import needs and facilitate fast-growing global trade.
The 12 vessels will be built by Hudong Zhonghua Shipbuilding Co, a unit of China State Shipbuilding Corp (CSSC), utilising the so-called fifth-generation LNG tanker technology that reduces fuel consumption and carbon emissions, CNOOC said in a statement on its website.
Each tanker can carry up to 174,000 cubic metres of LNG, equivalent to 108 million cubic metres when regasified. The vessels are slated for commissioning between 2024 and 2027, CNOOC said. The company, which first imported LNG in 2006, has built 10 LNG tankers and also engaged in joint vessel designing in tie-ups with CSSC.
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France: EDF charters fourth LNG carrier from NYK
NYK-affiliated company France LNG Shipping has secured a long-term charter contract for a new liquefied natural gas (LNG) carrier with EDF LNG Shipping SAS. The newly built LNG carrier is scheduled for delivery in 2025 from Hyundai Samho Heavy Industries Co. Ltd.
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This is the fourth NYK vessel on a long-term time-charter contract with the EDF Group.
The newly built LNG carrier will be propelled by a WinGD-built, dual-fuel slow-speed diesel engine. The carrier will also feature an Air Liquide–manufactured Turbo-Brayton refrigeration system that can tap surplus boil-off gas. Manufactured by GTT, the 174,000-cubic meter capacity membrane-type tank will be made of advanced insulating materials that reduce the vaporization rate.
Commenting on the signing of the fourth long-term time-charter contract with the EDF Group, NYK executive officer Hironobu Watanabe said. This conclusion is of great significance for further promoting the NYK Group’s ESG management. France LNG Shipping is a French ship-owning company jointly owned by NYK and Geogas LNG.
https://www.marinelink.com/news/edf-charters-fourth-lng-carrier-nyk-496350
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Technological Development for Cleaner and Greener Environment Hydrogen & Bio-Methane
PG&E launch feasibility study on hydrogen within gas pipelines
Pacific Gas and Electric Company (PG&E) revealed on Monday, May 02, that it will be launching a feasibility study to blend hydrogen and natural gas in a stand-alone transmission pipeline system in the US.
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PG&E claims the ‘Hydrogen to Infinity’ project will be the country’s ‘most comprehensive end to end study and demonstration facility’ will aim to examine the future potential of hydrogen as a renewable energy source. This could serve the entire global natural gas industry as well as PG&E and its customers.
A dedicated 130-acre facility adjacent to Northern California Power Agency’s (NCPA) Lodi Energy Centre power plant, will allow PG&E and its partners (NCPA, Siemens Energy, the City of Lodi, GDH Inc., and University of California at Riverside) to study the injection, storage and combustion of hydrogen blends in a range of end uses. Hydrogen to Infinity will utilise a hydrogen-natural gas blend for electric generation in the Siemens Energy 5000F4 Gas Turbine.
https://www.h2-view.com/story/pge-launch-feasibility-study-on-hydrogen-within-gas-pipelines/
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USA: Switching to biomethane is the most economic, NGVAmerica
Natural Gas Vehicles for America (NGVAmerica) and Coalition for Renewable Natural Gas (RNG Coalition) announced that 64% of all on-road fuel used in natural gas vehicles in calendar year 2021 was renewable natural gas.
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Biomethane can produce carbon-negative results when fueling vehicles like short- and long-haul trucks, transit buses, and refuse and recycling collection vehicles.
California Air Resources Board data confirms that the annual average carbon intensity (CI) value of California’s bio-CNG vehicle fuel portfolio in its Low Carbon Fuel Standard (LCFS) program was carbon negative and below zero at -44.41 gCO2e/MJ for calendar year 2021.
Renewable natural gas use as a transportation fuel grew 13% over 2020 volumes, up 234 percent from 2017 levels. NGVAmerica and RNG Coalition report that in 2021 a total of 610 million gallons (GGE) of natural gas were used as motor fuel. Of that, 390 million gallons (GGE) were from renewable sources.
Biomethane use as a motor fuel in 2021 displaced 3.8 million metric tons of carbon dioxide equivalent (CO2e). Put into perspective, its use last year: lowered greenhouse gas emissions, equivalent to removing the GHG from over 9.4 billion miles driven by the average passenger car; eliminated CO2 emissions, equivalent to removing CO2 emissions from more than 427 million gallons of gasoline consumed; and sequestered carbon, equal to growing close to 63 million tree seedlings for 10 years, or 4.5 million acres of U.S. forests for one year.
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Germany: MAN, ABB E-mobility to bring megawatt charging technology to long-haul trucking
MAN Truck & Bus had a near-series prototype of its upcoming electric truck, driven today in public for the first time on the site of the former Berlin Tempelhof Airport. A special technical feature of the electric commercial vehicle, which will be launched on the market in 2024, is its capacity for future megawatt charging.
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ABB E-mobility, a global provider of charging solutions for electric vehicles, aims to bring megawatt charging technology to market maturity in the next three years. MAN and ABB E-mobility are thus getting ready for the next phase of electromobility: operational capability for heavy-duty long-haul trucking with daily ranges between 600 and 800 kilometres. The Federal Minister of Digital and Transport Dr Volker Wissing. said, “We need to decarbonize road freight transport to achieve our climate targets. To make this happen, we are focusing above all on the market ramp-up of climate-friendly commercial vehicles and the development of a corresponding high-performance charging infrastructure.” During the minister’s test drive in the MAN electric truck, Alexander Vlaskamp, CEO of MAN Truck & Bus, emphasized that “accelerating the expansion of the charging infrastructure is the only way to achieve the evolution of transport and meet climate targets.”
He also highlighted why MAN is relying on battery-electric powertrains for future carbon-free commercial vehicle fleets: low operating costs and the best overall energy footprint. Two high-performance charging points with megawatt charging systems (MCS) are being built at four locations along the A2 federal highway. The project is intended to serve as the basis for nationwide expansion.
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