NGS’ NG/LNG SNAPSHOT – May 16-31, 2022
National News Internatonal News
City Gas Distribution & Auto LPG
Bengaluru’s piped gas project gets in the fast lane
The project to supply piped natural gas (PNG) to Bengaluru has made rapid strides in the seven years since it launched but only after some really painstaking efforts. Gail Gas Limited, a wholly-owned subsidiary of Gail India Limited,
won the City Gas Distribution (CGD) contract in 2015 to supply piped natural gas to Bengaluru underground from Dabhol in Maharashtra to Bidadi in the Ramanagara district. The supply to the port city comes from the Mangaluru-Kochi line. From the Bidadi line, Gail India Limited laid a 23-km subline connecting the Outer Ring Road (ORR).
Gail Gas Limited took over from here and laid a 73-km pipeline network, providing end-to-end connectivity to the ORR. The next step was setting up District Regulating Stations (DRS). A DRS is installed at the node of the pipeline network from where the gas is supplied to different areas at low-pressure levels.
These carbon steel pipelines are, in turn, linked to various residential, commercial and industrial establishments through a massive 1,500-km-long network of mediumdensity polyethene pipelines to provide individual connections. Individual houses get the gas supply through pipes that run in well-ventilated spaces. The company currently supplies 4 lakh standard cubic metres of PNG per day. That PNG is safer, cheaper and more convenient than liquefied petroleum gas (LPG) is a well-established fact. PNG is safe because it is lighter than air and cannot be pilfered.
A number of commercial establishments and industries have opted for PNG. These include shopping malls, hotels, software companies, pharmaceutical firms and industrial units. The demand for domestic connections is equally strong with at least 65 connections being added every day, Wathokdar said. When Wathodkar took charge in 2018, the city was receiving about 75,000 standard cubic metres of PNG. This figure is now 4 lakh.
Tamil Nadu will get cheaper piped gas by year-end
As the price of a cooking gas cylinder breaches Rs 1,000 across Tamil Nadu, households in East Tambaram, Sholinganallur, Karapakkam, Semmencherry, West Tambaram, and Perungudi might be able to switch to relatively cheaper piped natural gas connections soon.
While 24×7 supply of piped gas will begin only after six or seven months, registration has started in Kancheepuram and Chengalpattu districts through AG&P Pratham, which was awarded a gas distribution licence by the Petroleum & Natural Gas Regulatory Board.
The company will exclusively supply PNG to households, commercial businesses, and industries, & CNG for use in vehicles in the two districts, where it is currently laying pipelines. Similarly, Torrent has been laying pipelines in Chennai. According to Sh. S Rangarajan, regional head, Kanchi Geographical Area, AG&G Pratham, the price of piped natural gas will be 30% to 40% cheaper than LPG cylinders.
Sh. Rangarajan stated the company aims to register 1 lakh connections next year with an eight-year target of 11 lakh connections. TNIE learnt the target for Chennai and neighbouring Tiruvallur district is 33 lakh consumers over the next 8 years. Sh. Registrations started in March and connections, like installing pipeline verticals, will be given in a month’s time under a ‘Get Now and Pay Later’ scheme.
Initially, the focus is to supply the LCNG to industry first and a 10-km pipeline is being laid, of which work on 6 km has been completed. The demand is around 30,000 standard cubic metres per day (SCMD) and we will be able to supply this through a 10-km pipeline. The demand from industry is two lakh standard cubic metres per day.
IOCL lays gas pipeline for 75km in Coimbatore district, Tamilnadu
The Indian Oil Corporation Limited (IOCL), which is implementing the city gas distribution network, has laid the underground natural gas pipeline for up to 75km in the Coimbatore district. IOCL won the licence for the city gas distribution network in the district in the ninth round of bidding that the Petroleum and Natural Gas Regulatory Board held in August 2018.
Under the project, IOCL would lay the underground gas pipeline for 212km, develop 273 CNG stations and provide 9,12,783 domestic piped natural gas connections.
Sh. H Suresh, manager, district chapter of IOCL, said they were working on laying the underground gas pipeline on Avinashi Road and Trichy Road, where the flyover work was underway. Recently, IOCL had inaugurated a city gate station cum mother station for compressed natural gas at Pichanur. It is equipped with a pressure reduction-cum-regulating skid that has a capacity of 13,000 standard cubic metres per hour. After its inauguration, IOCL reduced the price for compressed natural gas by Rs5 in the district. According to Sh. Suresh, they have plans to expand the CNG network in the district to 41 stations by the end of the current fiscal.
Referring to the customers converting their vehicles to CNG, he said the same must be done through an RTO approved retro fitment centre.
Indian Oil to set up a biogas plant at Tirumala
Indian Oil Corporation (IOC) Limited is establishing a compressed biogas (CBG) plant at Tirumala, whose feedstock will be biodegradable solid (wet) waste generated at the hill town.
Trust board of the Tirumala Tirupati Devasthanams (TTD) has ratified a decision in this regard taken earlier by the TTD executive officer (EO). The board authorised the EO to finalise terms and conditions of MoU that is to be signed between the TTD and IOC. As part of Swachh Tirumala, the temple body had contemplated a municipal wet waste treatment plant at the hill town with Windrow technology, which would produce compost or manure and minimise the adverse impact on environment. The compost is being produced by O&M since March 27, 2017.
Against this backdrop, TTD approached IOC for a technical study regarding production of CBG. “After an inspection on February 28, 2021 and further discussions, IOC has come forward to establish a compressed biogas plant in Tirumala on a cost-sharing basis (IOC 50% and TTD 50%)
As per estimates, total requirement of LPG at Tirumala is average 3.335 MT per day. The proposed solar steam cooking system taken up by NREDCAP will reduce 1/3rd of LPG consumption by 1.1 MT per day. The proposed CBG plant will produce approximately 1.75–2 MT of bio-gas daily. Thus, dependency on LPG will be reduced to a great extent, resulting in net savings of around ₹2 crore per year for the TTD.
Natural Gas/ Pipelines/ Company News
GAIL’s natural gas supply reaches HPCL Mittal Energy refinery in Bathinda
State gas utility GAIL (India) has laid a dedicated pipeline to supply natural gas to HPCL Mittal Energy (HMEL) Bathinda refinery in Punjab. It looks to take the environment-friendly fuel to all corners of the country.
The gas receiving station for the pipeline was inaugurated by Prabh Das, Managing Director and CEO, HMEL in the presence of Sh. Manoj Jain, Chairman and Managing Director, GAIL; Smt. Vartika Shukla, Chairman and Managing Director, Engineers India Ltd and Sh. Deepak Gupta, Director (Projects), GAIL, it said.
The dedicated pipeline, which will supply 1 million standard cubic meters per day of gas to HMEL, has been laid at a cost of ₹142 crore. The 44.26 km pipeline of 12 inch diameter (total capacity – 5 mmscmd) is a spur line of the 500 km Dadri-Bawana-Nangal Pipeline (DBNPL). The natural gas supply tap off is taken from GAIL receiving terminal at NFL, Bathinda, according to a statement.
GAIL is India’s largest natural gas transporting and marketing firm. This is a step towards making natural gas available to large customers, the company said in a statement. The pipeline will boost the supply of natural gas in the region, resulting in increased supply for domestic households, vehicles, commercial and industrial establishments.
The DBNPL is a part of the national gas grid and runs from Dadri (Uttar Pradesh) through Yamunanagar (Haryana) to Nangal (Punjab), to meet energy demand of these northern states. It already supplies gas to various industrial customers and city gas networks in places like Ghaziabad, Bawana, Saharanpur, Yamunanagar and Mandi Gobindgarh, Nangal, Ludhiana, NFL Bhatinda and CGS Ludhiana.
IGL net profit rises 9% in quarter 4, 2022
Indraprastha Gas Limited (IGL), the largest CNG distribution company in the country, on Wednesday, May 18, reported a 9% increase in its net profit in the quarter ended March 2022, on rise in gas sales volume.
Net profit increased to Rs 363.08 crore in the January-March quarter from Rs 332.08 crore in the corresponding period last year. During this period, IGL registered a 55% rise in turnover to Rs 2,638.20 crore.
While CNG posted a sales volume growth of 16%, Piped Natural Gas (PNG) showed overall sales volume growth of 7% during the quarter. For the full 2021-22 fiscal (April 2021 to March 2022), turnover rose 56% to Rs 8,443 crore while net profit jumped 31% to Rs 1,314.95 crore. CNG volumes registered a growth of 36% in the fiscal, PNG sales volumes were up by 20% in 2021-22 over the previous fiscal. The board has recommended a dividend of 275% for the fiscal.
After consolidating the financial results of two associate companies, CUGL and MNGL, the consolidated net profit after tax of the company come to Rs 1,504 crore against a consolidated profit of Rs 1,172 crore in the year-ago period.
ONGC becomes the first company to sell Indian gas on domestic exchange
State-run oil and gas producer ONGC has become the first company in India to trade domestically produced gas on the Indian Gas Exchange (IGX). ONGC’s director onshore Sh. Anurag Sharma inaugurated the company’s centralised trading desk and sold gas from KG 98/2 project through the exchange.
The IGX in early May received approval from Indian downstream regulator Petroleum and Natural Gas Regulatory Board (PNGRB) to trade domestic gas on its platform. This approval is in line with the petroleum and natural gas ministry’s notification dated August 19, 2021, where domestic gas producers were authorised to sell up to 500mn m3 or 10% of annual production from the contract area, whichever is higher, per year through gas exchanges.
Only a part of India’s gas production can be sold freely at present while the rest is under an administered price regime. The biggest volume of such gas with marketing and pricing freedom comes from the Reliance-BP’s fields in the KG basin off India’s east coast.
The exchange currently facilitates delivery-based trades in six different contracts such as day-ahead, daily, weekday, weekly, fortnightly and monthly at five different designated physical hubs – Dahej, Hazira, Dabhol, Jaigarh and KG Basin.
Gail’s profit up 41% in January-March, 2022
India’s biggest gas marketing company Gail on May 27, reported a 41% year/year increase in standalone net profit in the three months to March 31 (Q4FY2022) on higher sales volume and product prices.
Gail’s profit was 26.83bn rupees ($370mn) in Q4 as against 19.08bn rupees in the same period last year. Revenue for the quarter increased 73% yr/yr to 269.68bn rupees.
For the year ended March 31, the company’s profit increased by 112% yr/yr to 103.64bn rupees. Gail recorded a 62% yr/yr increase in revenue from operations to 916.46bn. Gail said it had awarded a contract to set up India’s largest electrolyser to produce hydrogen.
Policy Matters/ Gas Pricing/ Others
CNG prices hiked by Rs 2 in Delhi-NCR
The price of compressed natural gas, or CNG, in Delhi and other cities of the National Capital Region was increased by Rs 2 per kilogram on Saturday, May 21, a notification by the Indraprastha Gas Limited (IGL) showed. After the latest price revision,
CNG will cost Rs 75.61 in Delhi. The gas will cost Rs 78.17 per kg in Noida, Greater Noida and Ghaziabad. In Gurugram, it will cost Rs 83.94 per kg. In Muzaffarnagar, Meerut and Shamli, CNG will cost Rs 82.84 per kg, whereas, in Rewari, it will cost Rs 86.07 per kg.
Gas prices vary from state to state due to different value added tax and freight charges. CNG prices have witnessed an increase of Rs 18.98 per kg in the last 51 days. Its price was last increased by Rs 2 in the Delhi-NCR region on May 15.
LNG Use / LNG Development and Shipping
India’s LNG imports drop 13% in April, 2022
India’s LNG imports in April came in at 2.47bn m3 (about 1.8mn metric tons), down 13.2% year/year, the country’s oil and gas ministry’s Petroleum Planning and Analysis Cell (PPAC) website showed on Tuesday, May 24.
The country’s imports were down 5.4% month/month. The LNG imports last month cost $1.3bn, up from $800mn in the same month last year.
No disruption in Russian LNG supplies despite geopolitical crisis: GAIL
India’s largest gas firm GAIL is getting regular supplies of liquefied natural gas (LNG) under a long-term deal with Russia’s Gazprom despite the geopolitical crisis, chairman and managing director Manoj Jain told PTI news agency. GAIL has signed a contract to import 2.85 million tonnes LNG from a Singapore-based unit of Russia’s Gazprom.
Earlier this month, Russia slapped sanctions on the owner of the Polish part of the Yamal pipeline that carries LNGto Europe, as well as the former German unit of the Russian gas producer Gazprom.
Sanctions, aimed at stopping the flow of Russian gas to Europe, have been imposed on Gazprom Germania, and 29 of its subsidiaries in Switzerland, Hungary, Britain, France, Bulgaria, the Benelux region, the United States, Switzerland, Romania and Singapore. Gazprom Marketing & Trading Singapore, he said, has been supplying LNG regularly under a long-term deal.
In spite of substantial FII outflows, India’s benchmark BSE Sensex reached its highest level in October 2021 and logged a whopping 21% return for the year.PREMIUM
GAIL expects Gazprom to supply about 40 LNG shipments in 2022, and a full contracted volume of 46 cargoes in 2023, under its term deal.
Under the deal, Gazprom is progressively increasing supplies to GAIL. It shipped 2 million tonnes of LNG in 2021 and is to supply 2.5 million tonnes in 2022. The full volume of 2.85 million tonnes is to be reached in 2023.
GAIL expects to import 5-6% higher LNG volume in the current 2022-23 fiscal. GAIL has been asked by the government to pool locally available natural and imported fuel for supplying to CNG and piped cooking gas operators in the country. The company will invest ₹30,000 crore in the next three years on pipelines, petrochemicals and other projects, he added.
Electric Mobility/ Hydrogen/ Bio- Methane
India to become a global leader in green hydrogen: Sh. Hardeep Singh Puri
Sh. Hardeep Singh Puri asserted that India would eventually become a leader in the green hydrogen space. India is more conscious of going for green energy than any other country in the world, Union Petroleum and Natural Gas Minister Sh. Hardeep Singh Puri stated on Monday, May 23.
He said special emphasis is being given on green hydrogen, biofuel blending and exploration and production of biofuel from alternative sources. Sh. Puri, also Union Minister for Housing and Urban Affairs, said India responded quickly and effectively when the Covid-19 pandemic hit the world and one of the most important decisions was to fast-track vaccine development and manufacturing on a war footing.
Speaking at a session on the sidelines of the World Economic Forum Annual Meeting 2022 here, Sh. Puri also talked about various transformational changes that have happened after 2014 during the Sh. Narendra Modi’s government. The breakfast session on ‘Unleashing power of Indian diaspora for philanthropy, entrepreneurship and social impact’, was organised by industry body CII and Indiaspora.
Tripura adopts Electric Vehicle Policy to promote EVs, curb pollution
To curb vehicular pollution and save fuel, the Tripura government has adopted the Tripura Electric Vehicle Policy 2022 to promote electric vehicles. A senior official of the Transport Department said that Tripura is the 15th state in the country and third in the northeastern region after Assam and Meghalaya to adopt the electric vehicle policy.
He said that the state cabinet headed by Chief Minister Sh. Manik Saha adopted the Tripura Electric Vehicle Policy 2022 to encourage people to use more and more electric vehicles in the state.
The official said that there are 60,000 different types of vehicles in Tripura and the government has targeted to convert 10% of these 60,000 vehicles into electric driven in the next five years.
According to the official, the electric vehicles policy is already in place in 14 states, including Assam and Meghalaya in the northeastern region of the country. Meanwhile, in Tripura, over 12,000 vehicles including around 8,000 private cars and 3,800 auto-rickshaws are run by the Compressed Natural Gas (CNG), provided by the state owned Tripura Natural Gas Company Limited (TNGCL).
eBikeGo, Log9 Materials in partnership for 10-min superfast charging technology for Velocipedo
Bengaluru: eBikeGo an electric two-wheeler mobility platform, has recently partnered with Bengaluru-headquartered advanced battery technology start-up Log9 Materials to launch their 10-minute Superfast Charging Technology (InstaCharge technology) for their upcoming electric trike,
Velocipedo. Both the companies have entered into a long-term partnership by signing a Memorandum of Understanding (MOU).
With this partnership, eBikeGo aims to disrupt not only the Indian but also the international EV market. On the other hand, Log9 Materials will be bringing their expertise to the table by adapting their InstaCharge Tech that enables Velocipedo to be charged within just 10 minutes, making it a new benchmark in the EV industry. Under this partnership, Log9’s superfast InstaCharge technology will empower Velocipedo to be well-equipped and hence widely adopted for multiple use cases such as ride hailing, personal mobility and as a cargo vehicle for businesses. The production will begin by the start of 2023.
The basic model can accommodate two people, has a top speed of 95 Kmph and a range per charge of 100 kilometres. With the superfast technology developed by Log9 Materials, the Velocipedo will take only 10 minutes (on 220V outlet) to get fully charged, and regenerative braking feature could add 10-20% to the range.
Natural Gas / Transnational Pipelines/ Others
Qatar: Natural gas has potential to expand significantly over the coming decades in G20
The upcoming G20 Energy Ministerial under the Presidency of Indonesia signals an opportunity to emphasise the soaring role of natural gas in satisfying growing energy needs of G20 and recognise importance of natural gas for the World when “recover together – recover stronger”.
Delivering a keynote at a G20 Webinar Event on Wednesday, 11 May 2022, on ‘Escalating the Role of Gas in Energy Transition’ via videoconference, HE Eng. Mohamed Hamel drew the attention of senior G20 and Southeast Asian energy experts that natural gas offers the balanced solution that the world seeks to achieve sustainable development goals in line with the United Nations 2030 Agenda and the Paris Agreement.
The increasing pace of global energy transitions and advancement of modern technologies, which unleash great potential of natural gas as a viable fuel, to enhance global energy security, eradicate energy poverty, and build flexible, resilient and sustainable energy systems, in synergy with other energy sources.
Natural gas has a crucial role in satisfying growing energy needs, whilst contributing to air quality improvement and climate change mitigation; its share in the global energy mix is expected to increase from 23% to 27% by 2050.
Iran to revive gas pipeline project to Oman
Iran’s oil minister has agreed to revive a long-stalled project to lay an undersea pipeline to carry gas to Oman, the Iranian state news agency IRNA reported on Saturday, May, 21.
Iran sits on one of the world’s largest gas reserves, which Oman has been eyeing as it hopes to feed energy-intensive industries and liquefied natural gas (LNG) export plants. IRNA said the agreement to revive the project was reached during a trip to Oman by Iranian Oil Minister Javad Owji ahead of an official visit to the Gulf Arab state by Iranian President Ebrahim Raisi on Monday, May 23.
In 2013, the two countries signed a deal, valued at $60 billion over 25 years, for Iran to supply gas to Oman through an undersea pipeline. In 2016, the two countries renewed efforts to implement the project, and Iran said in 2017 that it had agreed with Oman to change the route of the planned pipeline to avoid waters controlled by the United Arab Emirates.
The project was subsequently delayed by price disagreements and US pressure on Oman to find other suppliers before the United States withdrew from a 2015 nuclear deal between world powers and Iran, and reimposed sanctions in 2018. Tehran and Washington have held indirect talks in Vienna over the past year to revive the nuclear agreement which led to the lifting of sanctions, but the negotiations have stalled.
Malaysia: Piasau Gas to gain from Sarawak’s natural gas resources
Piasau Gas Sdn Bhd, which is set to be acquired by Shin Yang Shipping Corp Bhd (Syscorp), plans to build a compressed natural gas (CNG) plant to take advantage of the abundance of Sarawak’s natural gas resources.
When built, the plant will compress natural gas into long tube tankers for distribution to various oil palm estates and industrial plants. Syscorp is seeking shareholders’ green light for the proposed acquisition during an EGM in Miri on May 30, 2022.
Piasau Gas is principally engaged in the manufacturing, distribution and marketing of industrial gases, provision of services and maintenance and trading in welding equipment and machinery.
Smith is a joint project by Sarawak Economic Development Corp, Arrow Medsource Group from the United States and several other global partners. The project is currently under construction.
Sarawak Premier Datuk Patinggi Abang Johari Tun Openg said recently that a US-based healthcare company will be investing RM1bil to produce medical products in Smith, adding that the company is now implementing its first phase project estimated to cost RM200mil, to be followed by another RM800mil investment in the second phase.
Mr. Koh said Petroliam Nasional Bhd had recently signed production sharing contracts for five offshore exploration blocks, which would attract some RM600mil in exploration activities in Malaysia. The blocks are located off the coast of Sabah and Sarawak.
North Dakota extends deadline for west-to-east natural gas pipeline proposals
The North Dakota Industrial Commission has extended until August 15 the deadline to submit proposals for a natural gas pipeline connecting the western and eastern portions of the state.
The state legislature in 2021 approved $150 million in grants to fund the project, stipulating that $10 million of the total must be used for a section to transport gas to Grand Forks County. No proposals for the larger $140 million component were received by the May 01 deadline.
Viking Gas Transmission Co., a subsidiary of Oneok Inc., submitted the only proposal for the $10 million Grand Forks section. This portion would comprise a 14-mile, 12-inch diameter pipeline to supply incremental gas service into Grand Forks County, said North Dakota Pipeline Authority Director Justin Kringstad.
The call for proposals does not define a precise route or transport capacity for the west-to-east pipeline. In a letter sent to Kringstad in late April, which was first reported by the Associated Press, WBI Energy Transmission, a subsidiary of Bismarck, ND-based MDU Resources Inc., said it would not submit a proposal. WBI cited inflationary pressures and uncertainty around the siting and regulatory process.
Japan: Jera completes pipeline for Futtsu LNG import terminal
Japanese energy giant Jera and partners have marked completion of the Nanohana Pipeline connecting the Futtsu LNG import terminal and the Anegasaki thermal power station in Chiba. The partners include Jera, Keiyo Gas, Otaki Gas,
TEPCO Energy Partner, and Nanohana Pipeline. On 20 May, they held a ceremony to mark the completion of the Nanohana Pipeline (NP) for transporting natural gas.
Keiyo Gas and Otaki Gas are behind the Nanohana Pipeline. The company started with the pipeline high-pressure trunk line construction back in 2018. The pipeline runs approximately 31 kilometres from Jera’s Futtsu LNG terminal to the Anegasaki thermal power station in Chiba Prefecture. It will begin operating in June this year, according to Jera.
With the completion of the NP, the five companies say they will contribute to the stable supply of natural gas while living up to the expectations of customers.
Natural Gas / LNG Utilization
Gazprom’s natural gas transit through Ukraine drops by 26.4%
Firm’s gas delivery dropping to 45.9M cubic meters on Saturday, May 21, down from 62.4M on Friday, May 20. Russia’s energy giant Gazprom’s natural gas flow through Ukraine dropped by 26.4%. Gazprom delivered 62.4 million cubic meters of natural gas via Ukraine.
He stressed that there has been a significant decrease in the demand for natural gas delivery through Ukraine. Ukraine stopped buying Russian gas from the Sokhranivka natural gas distribution point in the Donbas region on May 11,. Russia was transiting 30% of the gas to Europe via Sokhranivka, which has a daily capacity of around 30 million cubic meters of natural gas.
Chinese LNG imports dive 35% & Japanese increases 12% in April
Chinese LNG imports in April were 4.35mn metric tons, down 34.5% year/year, customs department data published on May 18 showed. Imports were down 6% month/month.
The cumulative LNG imports in the first four months of 2022 were 21.59mn mt, down 17.3% yr/yr. The pipeline gas imports in April were 3.74mn mt, up 9.3% yr/yr. China’s cumulative pipeline gas imports in January-April came in at 14.28mn mt, up 7.7% yr/yr, the customs department data showed. China last year imported record 78.93mn metric tons of LNG, up 18.3% year/year, customs department data published on January 18 showed.
On the other side, Japanese LNG imports in April were 5.57mn metric tons, up 12.1% year/year, according to the provisional data published by the country’s finance ministry on May 19. Japan’s shipments last month cost 557.2bn yen ($4.35bn), up 151% yr/yr.
Slovenia hopes to import Qatari LNG via Italy’s Rovigo terminal – Infrastructure minister
Slovenia is in talks for the import of liquefied natural gas (LNG) from Qatar through the Rovigo terminal in Italy, Slovenian infrastructure minister Jernej Vrtovec said.
Last week, Slovenian gas wholesaler Geoplin lost the tender for booking additional capacities at the Krk LNG terminal in Croatia, thwarting Ljubljana’s efforts to deal with a potential energy crisis that could occur in the autumn if the war in Ukraine continues and the EU does not lift the sanctions against Russia. The tender was won by Croatian privately-owned natural gas trader Prvo Plinarsko Drustvo (PPD).
After meeting with Qatari energy minister Saad Sherida al-Kaabi in Doha in March, Vrtovec said that Slovenia hopes to shortly start importing natural gas from Qatar via LNG terminals in the northern Adriatic, but needs to first ensure free terminal capacity. The Rovigo LNG terminal is operated by Italian company GNL Adriatico, owned by Qatar Petroleum, ExxonMobil and Snam.
Chinese gas output up 4.7% in April
China’s natural gas output in April was 17.7bn m3, up 4.7% year/year, state-run Xinhua news agency reported on May 22 citing data from the country’s statistics department.
In the first four months of this year, Chinese gas output was 74.7bn m3, up 6.2% yr/yr, the data showed.During the January-April period, China imported a total of 35.87mn metric tons of natural gas, down 8.9% yr/yr, the customs department reported in early May.
U.S. natgas soars to 13-yr high as power and LNG plants use more fuel
U.S. natural gas futures jumped about 4% to a fresh 13-year high on Wednesday, May 25, as power generators and liquefied natural gas (LNG) export plants consumed more of the fuel. Power companies burned more gas to generate electricity due to a lack of wind in recent weeks.
Wind was on track to produce just 10% of U.S. power generation this week, down from a recent high of 16%, while gas was on track to generate about 36% this week, up from a recent low of 33% a few weeks ago.
On their second to last day as the front-month, gas futures for June delivery rose 38 cents, or 4.3%, to $9.176 per million British thermal units (mmBtu) at 9:28 a.m. EDT (1328 GMT), putting the contract on track for its highest close since August 2008 for a second day in a row.
Futures for July, which will soon be the front-month, were up about 4.7% to $9.25 per mmBtu. U.S. gas futures were up about 146% so far this year as much higher prices in Europe and Asia kept demand for U.S. LNG exports strong, especially since Russia’s Feb. 24 invasion of Ukraine stoked fears Moscow might cut gas supplies to Europe.
Despite those supply concerns in Europe, U.S. futures have soared about 38% over the past month, while European prices slid about 9% as Russia keeps sending supplies via pipeline and LNG vessels keep delivering cargoes. Gas was trading around $27 per mmBtu in Europe and $22 in Asia.
Global LNG Development
Vietnamese, US firms get investment registration certificate for LNG terminal project
PetroVietnam Gas JSC (PV Gas) and the AES Corporation of the US have been granted an investment certificate and a business registration certificate for the Son My LNG terminal project. Vietnamese Minister of Investment and Planning Nguyen Chi Dung handed
over the certificates to the two enterprises in the presence of visiting Prime Minister Pham Minh Chinh and US Secretary of Commerce Gina M. Raimondo in Washington D.C. on May 11.
The investment certificate is a significant enabler for establishing the Son My LNG terminal project company, which is formed by PV Gas and AES affiliates. The terminal will have an installed capacity of 450 TBtu and represents a total investment of about 1.4 billion USD. It is expected to achieve financial completion in 2023 and begin commercial operations in 2026.
The Son My LNG terminal complements AES’ project in the Son My 2 Combined Cycle Gas Turbine (CCGT) power plant. Together, the plant and the terminal affirm AES’s commitment to Vietnam’s economic growth and energy transition through developing gas and renewable infrastructure while helping the country meet its energy transition goals and the increasing demand for sustainable and affordable electricity.
UAE: McDermott wins feed contract for Adnoc’s LNG plant in Fujairah
McDermott International, a leading engineering, procurement, construction and installation (EPCI) company, has been awarded a front-end engineering and design contract by Abu Dhabi National Oil Company (Adnoc) for its new, carbon-efficient liquefied natural gas (LNG) plant located in the northern emirate of Fujairah.
The Fujairah LNG export terminal will include two trains, each with a 4.8 million tonnes per annum (MTPA) of LNG capacity. Adnoc said expects this to increase its LNG production capacity by 9.6 million tonnes per annum (MTPA) as a response to the growing global demand for natural gas. The facility will also likely feature LNG storage tanks, an export jetty with an option for bunkering, and other associated facilities.
McDermott has been named design contractor for the plant, which is currently in design stage and is likely to see awarding to an EPC contract in 2023, said the company in a statement. On completion, the plant is set to become one of the world’s lowest carbon intensity LNG production facilities through incorporating new technologies and running on clean power.
Sempra Infrastructure and PGNiG advance North American LNG alliance
Sempra Infrastructure, a subsidiary of Sempra, and the Polish Oil & Gas Company (PGNiG) announced on May 17, they have entered into a heads of agreement (HOA) for the purchase of approximately 3 million tonnes per annum (Mtpa) of liquefied natural gas (LNG) delivered free-on-board from Sempra Infrastructure’s portfolio of LNG projects in North America.
The referenced HOA contemplates the negotiation and finalization of definitive 20-year LNG sale-and-purchase agreements for 2 Mtpa from the Cameron LNG Phase 2 project under development in Louisiana, and 1 Mtpa from the Port Arthur LNG project under development in Texas. Sempra Infrastructure is developing the Cameron LNG Phase 2 project, which is expected to include a single LNG train with a maximum production capacity of approximately 6.75 Mtpa of LNG as well as debottlenecking of the existing three LNG trains at the facility in Hackberry, Louisiana. Last month, Sempra Infrastructure signed an HOA with the Cameron LNG partners for the development of the Cameron LNG Phase 2 project.
The HOA is a preliminary, non-binding arrangement, and the development of the Cameron LNG Phase 2 and Port Arthur LNG projects remains subject to a number of risks and uncertainties, including reaching definitive agreements, securing all necessary permits, signing engineering and construction contracts, obtaining financing and incentives and reaching a final investment decision for each project.
Long term LNG contracting off to a fast start this year with more than 10 MMPTA signed
Demand for long-term LNG contracts continues to gain momentum this year as large volumes have been signed and prices for oil-linked deals under negotiation are rising. Long-term contracting is off to a fast start this year with more than 10 million tonnes per annum (mmtpa)
signed to end-market users. In 2021, the volume of long-term LNG contracts signed to end-user markets returned to its highest level in the last five years. This momentum continues into 2022.
The result is rising prices for long-term oil-linked contracts under negotiation. Between 2020 and early 2021, long-term oil-linked contract prices fell into the 10% range, levels not seen in the last 10 years. This was driven by Qatar opting for a market share strategy, other sellers having long uncontracted positions and Japanese legacy buyers being out of the market for long-term volumes.
Chinese buyers continue to dominate the market signing more than 8 mmpta of new LNG sale and purchase agreements this year. Most new contracts are from US supply as operators move projects forward. All these contracts are linked to North American prices.
Germany, Qatar sign energy partnership agreement
Germany and Qatar signed on Friday, May 20, a declaration to deepen their energy partnership, with a focus on trade in hydrogen and liquefied natural gas (LNG), as Europe’s biggest economy looks for alternative supplies amid Russia’s invasion of Ukraine.
The partnership deal foresees regular meetings between authorities from both countries and creates a working group focused on developing trade relations in LNG and hydrogen, as well as one devoted to renewable energy.
Qatar’s Emir Sheikh Tamim bin Hamad al-Thani was in Germany for the signing of the deal with German Economy Minister Robert Habeck, who travelled to Qatar in March, along with officials from German utilities RWE and Uniper, for talks on long-term LNG supply deals.
The agreement does not mean long-term LNG deals will be concluded, three people familiar with the supply deal talks told Reuters earlier this month. Those talks face challenges, they said, with Berlin reluctant to commit to Qatar’s conditions to sign deals of at least 20 years to secure the massive LNG volumes Germany needs to reduce its dependence on Russian gas.
Russia is currently the largest supplier of gas to Germany, and Habeck has launched several initiatives to lessen Berlin’s energy dependence on Moscow since the invasion of Ukraine.
Excelerate Energy okayed to operate Brazil LNG terminal
Brazil’s waterways transport regulator Antaq has authorized Excelerate Energy to begin operations of the Madre de Deus LNG regasification terminal (TRBA) in Bahia state.
The terminal was leased by the company from federal oil company Petrobras last September for 102mn reais (US$21mn) until December 2023. The project is deemed by the government to be an important step in the process of opening up and increasing the competitiveness of the natural gas segment.
CaliforniaUSA: SpaceX Scrubs Plan to Build Mini LNG Plant
Elon Musk-owned SpaceX has scrapped plans to build a small-scale liquefied natural gas plant at the rocket company’s Boca Chica launch site in Texas.
SpaceX no longer proposes to build a desalination plant, power plant, natural gas pre-treatment system and liquefier at the site’s vertical launch area, the US Fish & Wildlife Service said in a May 12 document obtained by Bloomberg through an open records request. The SpaceX plans were described in previous assessment documents in September and October. SpaceX didn’t immediately respond to an emailed request for comment.
Finland: Baltic states step up LNG import push
Finnish transmission system operator Gasgrid Finland has signed a ten-year contract with US firm Excelerate Energy to charter a floating storage and regasification unit (FSRU), which may initially be located across the Gulf of Finland in Estonia.
And another floating import project in Latvia has attracted a new partner as the Baltic region attempts a pivot away from dependence on Russian pipelines. Under the Finnish deal, Excelerate’s Exemplar vessel—with LNG storage capacity of 150,900m³ and more than 5bn m³/yr of throughput capacity—will provide regasification services in southern Finland. But the FSRU may be moored in an Estonian port this winter if required work has yet to be completed .
France: TotalEnergies, South Korea’s Hanwha ink 15-year LNG deal
French energy company TotalEnergies and South Korea’s Hanwha Energy Corporation signed a 15-year sale and purchase agreement to supply liquefied natural gas (LNG), the company announced on Tuesday, May 24.
TotalEnergies will send 600,000 metric tons of LNG a year starting in 2024. Hanwha will use the LNG, sourced from TotalEnergies’ global LNG portfolio at its 1 gigawatt gas-fired, combined-cycle power plant, which is currently under construction.
The LNG will be delivered to the Tongyeong regasification terminal in South Korea. South Korea was the world’s third-largest importer of LNG in 2021.
Texas, USA: Cheniere, Korea’s POSCO sign LNG deal
Cheniere Energy on May 25, announced that its subsidiary, Cheniere Marketing, has entered into an LNG sale and purchase agreement (SPA) with POSCO International Corp, a subsidiary of South Korea’s POSCO Holdings.
Under the agreement, POSCO International will purchase approximately 0.4mn metric tons/year of LNG from Cheniere Marketing on a free-on-board basis for a term of 20 years beginning in late 2026. The purchase price for LNG under the SPA is indexed to the Henry Hub price, plus a fixed liquefaction fee. POSCO is the owner of South Korea’s first private LNG terminal.
The SPA is subject to Cheniere making a positive final investment decision to construct the Corpus Christi Stage III project. The Corpus Christi Stage III project is being developed to include up to seven midscale liquefaction trains with a total expected nominal production capacity of over 10mn mt/yr.
USA: Crowley opens LNG terminal in Puerto Rico
US shipping conglomerate Crowley has inaugurated an LNG loading terminal in Peñuelas in the south of Puerto Rico. The facility will significantly grow Crowley’s service capabilities in Puerto Rico, delivering more than 94m gallons of LNG annually.
Functionally, from Peñuelas, operators will load natural gas in its liquid form onto 10,000-gallon ISO containers for over-the-road transport to customer facilities around the island. Upon arrival at the customer’s site, the LNG will be re-gasified and used for power generation and energy consumption.
North America: RWE and Sempra Infrastructure ink LNG heads of agreement
Sempra Infrastructure, a subsidiary of Sempra, has announced that it has entered into a heads of agreement (HOA) with RWE Supply & Trading, a subsidiary of RWE, for the purchase of approximately 2.25 million tpy of LNG.
The LNG is to be supplied on a long-term, free-on-board basis from the Port Arthur LNG Phase 1 project under development in Jefferson County, Texas, US.
The HOA contemplates the negotiation and finalisation of a definitive 15-year LNG sale and purchase agreement for 2.25 million tpy to be delivered from the Port Arthur LNG project. Additionally, Sempra Infrastructure and RWE have agreed to work toward a broad framework for the reduction, mitigation, and reporting of GHG emissions associated with deliveries of LNG from the Port Arthur LNG project, including addressing the use of responsibly sourced natural gas as part of the project’s feed gas supply and renewable energy as part of the project power mix.
Phase 1 of the Port Arthur LNG project is fully permitted and is expected to include two liquefaction trains and LNG storage tanks, as well as associated facilities capable of producing, under optimal conditions, up to approximately 13.5 million tpy of LNG.
LNG as a Marine Fuel/Shipping
South Korea: Samsung Heavy wins ₩862.3 bn order for 3 LNG carriers
Samsung Heavy Industries Co., the world’s No. 3 shipbuilder by order backlog, said Tuesday it has bagged ₩862.3 bn (billion-won), (US$671 million) order to build three liquefied natural gas (LNG) carriers in Africa.
Samsung Heavy said it will construct those LNG carriers for an unidentified African shipper and deliver them by January 2026.
The vessels will have top-of-the-line equipment, such as a membrane-type storage tank and a duel fuel gas engine, said Samsung Heavy, the shipbuilding arm of South Korea’s top conglomerate Samsung Group.
With this latest order, Samsung Heavy has clinched orders for 17 ships worth $2.9 billion so far this year, or 33% of its yearly order target.
Samsung Heavy said it will seek to increase its order backlog stably by focusing on profitability, as orders for high value-added, eco-friendly vessels account for 71% of this year’s total.
Poland: PGNiG Group chartered vessel delivers LNG
The tanker Maran Gas Apollonia with the cargo of over 65 000 t of LNG arrived at the President Lech Kaczynski LNG Terminal in Swinoujscie, Poland. This is the first delivery made on a vessel chartered by PGNiG Group. It is also the first shipment PGNiG has received from Venture Global LNG who will soon be a major supplier to Poland.
The tanker Maran Gas Apolonia brought over 65 000 t of LNG, which corresponds to over 90 million m3 of natural gas after regasification. The cargo was loaded at the Calcasieu Pass liquefaction terminal in Louisiana, US, owned by Venture Global. Starting next year, PGNiG will start receiving 1.5 million t of LNG per year (2 billion m3 of natural gas, after regasification) from the Calcasieu Pass terminal under a long-term contract. PGNiG also has a long-term agreement with Venture Global to receive 4 million tpy (approximately 5.3 billion m3 of natural gas, after regasification) from the Plaquemines liquefaction terminal in Louisiana.
Both long-term contracts with Venture Global are based on FOB formula. In order to receive gas purchased under these contracts, PGNiG has started to develop its own fleet of LNG tankers. The Group has chartered eight units, each with a capacity of 174 000 t of LNG, that will be built exclusively for the PGNiG Group. The first two tankers will enter into service next year, the next two – in 2024 and the remaining four – in 2025.
South Korea: KSOE and SHI Win Orders for LNG Carriers
Korea Shipbuilding & Offshore Engineering (KSOE), the shipbuilding holding company of Hyundai Heavy Industries Group, announced on May 17 that it has signed a contract with an Asian shipping company to build four large liquefied natural gas (LNG) carriers.
Samsung Heavy Industries (SHI) also announced on the day that it has won an order for three LNG carriers from a shipping company in Africa.
The four vessels won by KSOE are 174,000 cubic meters each. Hyundai Heavy Industries and Hyundai Samho Heavy Industries will each build two of them for delivery from the first half of 2025. The total order value is 1,168.2 trillion won. KSOE explained that the latest contract boosted its order intake for this year to 95 ships worth US$11.18 billion, which amounts to 64.1% of its annual order goal of US$17.44 billion.
SHI will build three LNG carriers worth 862.3 billion won for an African client. The vessels will feature a membrane type cargo hold and gas engines (X-DF). The shipbuilder said that it will deliver them sequentially by January 2026. SHI has thus far won 17 ships worth US$2.9 billion, attaining 33% of its annual order intake target of US$8.8 billion.
Hong Kong: Seaspan Orders Four 7,700 TEU Dual-fuel LNG Containerships
Containership owner Seaspan Corporation on Wednesday, May 18, announced it has ordered four “ultra-modern” 7,700 TEU dual-fuel liquefied natural gas (LNG) containerships from an unnamed “major” shipyard. The newbuilds are scheduled to be delivered in the third and fourth quarters of 2024,
and upon completion will enter into long-term charters with a “leading global liner customer”.
Seaspan, a wholly-owned subsidiary of New York-listed Atlas Corp., said the charters include purchase obligations at the conclusion of the charter terms, and will contribute approximately $0.95 billion of gross contracted cash flow. The shipowner, which has been on a containership ordering spree, said it intends to use existing liquidity, cash flow and additional borrowings to finance the new ships.
Hamilton, Bermuda: Snam orders Sardinia FSRU from Golar LNG
Golar LNG will repurpose the LNG carrier Golar Arctic as a floating storage and regasification unit (FSRU) that will operate offshore Sardinia.
The Italian gas distributor, which has provisionally awarded the Eur269-million ($283-million) contract for the conversion, will install the vessel in the port area of Portovesme. The FSRU will have a storage capacity of 140,000 cubic meters.
Start of activities for the conversion and related issues remain subject to Snam’s issuing a notice to proceed. The conversion/delivery should take about two years to complete.
Titan LNG and Brittany Ferries sign long-term agreement
Titan LNG and Brittany Ferries have signed a long-term agreement for the supply of LNG and liquified bio methane (LBM) to two new LNG-fuelled hybrid Ro-Pax vessels that Brittany Ferries will operate between England and France from 2025.
The ferries will serve established routes connecting Portsmouth, UK, with Saint-Malo, France, and Portsmouth with Ouistreham, France. Titan aims to supply fuel to both vessels during usual cargo operations alongside (SIMOPS) to avoid delays to sailing schedules.
The two 194.7 m, 1400 passenger LNG-hybrid ships will join the fleet in 2024 and 2025, replacing two of the longest-serving vessels, Bretagne (1989) and Normandie (1992). They will follow two new LNG-fuelled ships, Salamanca, which entered service in March 2022, and Santoña, which will arrive on fleet in 2023.
The hybrid vessels will have a large battery hybrid power system of 10 MWh for propulsion and manoeuvring in port, and an 8 MW electric shore connection that will allow charging in port when infrastructure allows. As well as significantly cutting emissions, hybrid propulsion promises less noise and a smoother ride for passengers.
This partnership marks the significant expansion of Titan’s operations in the English Channel which will enhance the availability of LNG, LBM, and in the longer run hydrogen-derived LNG in the region. Titan will bring additional barge capacity to meet this demand. There are plants for a Krios series vessel to serve Brittany Ferries and to regularly transit between relevant ports.
GTT receives order from Hyundai Heavy Industries
GTT has been chosen in April 2022 by its partner the Korean shipyard Hyundai Heavy Industries to design the cryogenic fuel tanks of six LNG fuelled container vessels.
These six vessels will have a capacity of 7900 containers each and will be equipped with LNG tanks, holding up to 6000 m3 of LNG used as fuel. The tanks will be fitted with the Mark III Flex membrane containment technology, developed by GTT.
LNG is today the marine fuel of choice option to preserve air quality, a major public health issue. It reduces sulphur oxide emissions by 99%, fine particles by 91%, and nitrous oxide emissions by 92%. It also reduces ship emissions of CO2 by up to 20% compared to a conventional ship.
CIMC SOE wins contract from Seaspan for two new LNG vessels
China-based CIMC Sinopacific Offshore & Engineering (CIMC SOE) has secured a contract from Seaspan ULC for two new liquefied natural gas (LNG) bunkers. Under the contract, CIMC SOE will construct two 7,600m³ LNG bunker vessels, which will be used in the Pacific Northwest Region.
The contract also has an option for the construction of a third vessel. The first LNG bunker is anticipated to be delivered and enter operation in 2024.
Seaspan collaborated with the Canadian-based team at VARD Marine for the design of the LNG bunker vessels. The companies worked together to integrate emerging technologies, which would cut down emissions and underwater noise, into the vessels. The vessels were also designed to support the refuelling of multiple ship types, with the potential to transfer to and from a wide range of terminals.
Furthermore, the design will enable the vessel to be involved in ship-to-ship LNG transfer, in addition to coastal and short sea shipping operations.
After receiving the vessels, the company will enter long-term charters with a major global liner customer.
Excelerate Energy and Gasgrid Finland sign FSRU charter agreement
Excelerate Energy, Inc. (Excelerate) and a subsidiary of Gasgrid Finland Oy (Gasgrid Finland) have signed a 10-year contract in Helsinki, Finland, to charter a FSRU that will provide flexible, reliable, and secure LNG to Finland, Estonia, and the Baltic Sea Region.
Excelerate President and CEO Steven Kobos, Gasgrid Finland CEO Olli Sipilä, and Gasgrid Finland Chairman of the Board Kai-Petteri Purhonen signed the contract at the government palace in Helsinki in a ceremony also attended by Minister of Finance Annika Saarikko, Director-General for Energy Riku Huttunen, and US Ambassador to Finland Douglas Hickey.
Under the time charter party agreement, Excelerate will deploy its FSRU Exemplar to provide regasification services in Southern Finland. The Exemplar has storage capacity of 150 900 m3 of LNG and can provide more than 5 billion m3/y of regasification capacity.
Per the cooperation agreement signed on 4 May by Gasgrid Finland and Estonia’s gas transmission operator Elering AS, the FSRU may be located in an Estonian port this winter if the port structures are not yet completed in Finland. The governments of Finland and Estonia published a Memorandum of Understanding (MoU) on 29 April agreeing to jointly lease an FSRU.
Technological Development for Cleaner and Greener Environment Hydrogen & Bio-Methane
Spain: first hydrogen filling station in a logistics center
FM Logistic became the first logistics company in Spain to have a hydrogen refueling station. Located in its warehouse in Illescas, Toledo, this facility will be able to dispense up to 45kg/week of hydrogen. In principle,
it will supply green hydrogen to a van intended for urban logistics and to the forklifts of this warehouse. These are the first forklifts for transporting goods that were transformed to be refueled with hydrogen.
FM Logistic is also the first Spanish logistics company to use green hydrogen in an integrated project. In addition to having a hydrogen station to supply its vehicles, it obtains the energy necessary to carry out electrolysis through photovoltaic energy. This energy comes from the solar panels that are available on the roof of the Illescas center. In this way, only oxygen is expelled into the environment.
The company will supply its filling station with the same mains water that supplies its warehouse. The quantities of water used are not significant and, in addition, a part is reused for irrigation. The rest is returned to the atmosphere in the form of vapor, so the water cycle is not altered at all.
At the opening ceremony, an on-site refueling of a forklift was carried out. FM Logistic also showcased its urban van that will be converted to hydrogen and a hydrogen Toyota Mirai car. The new station compresses the hydrogen at 500 bars and dispenses it at 350.
Novel tech for extracting hydrogen gas from liquid carriers
North Carolina State University (NCSU) has developed an energy-efficient strategy for room-temperature hydrogen release from liquid hydrogen carriers, which uses less rhodium. Elsewhere in the world, Airbus launched its Zero Emission Development Centre in the UK,
Toshiba ESS teamed up with Fusion Fuel to target Australian and European markets, and Corfo signed agreements to finance three renewable hydrogen projects with GNL Quintero, iCAP, and Air Liquide in Chile.
The hydrogen-carrying liquid is pumped into one end of the tube. Only the outer grains of titanium oxide, the ones exposed to the sun at the other end of the tube, are coated with rhodium. These photoreactive catalysts react with the liquid carrier to release hydrogen molecules as a gas. “In a
conventional batch reactor, 99% of the photocatalyst is titanium oxide, and 1% is rhodium. In our continuous flow reactor, we only need to use 0.025% rhodium, which makes a big difference in the final cost.