Global LNG prices poised to firm as new buy tender and outages bite

LNG prices

High Asian supply dropped LNG prices last week, however, uncertainty over when production will resume at Chevron’s Gorgon export plant clouded outlooks. LNG Photo by Erich Gaedeke.

LNG prices up on strong demand from Argentina, India

 

MILAN, July 8 (Reuters) – Asian LNG prices were set to rise next week on strong prompt demand from Argentina and India as well as potentially lengthier supply disruptions in Australia and Angola.

However, this week Asian spot LNG prices traded lower at $5.25 per million British thermal units (mmBtu), down 25 cents since last week.

More supply in Asia helped lower prices following a streak of gains recently, but uncertainty over when Chevron Corp’s newly-built Gorgon LNG export plant will resume clouded outlooks.

Last week Chevron suspended production at Gorgon due to a gas leak and said operations would resume a week later, although it is not clear if that is still the case.

A shipping schedule released before the leak showed Gorgon would export on July 9 using the Asia Excellence tanker, which is anchored nearby, shipping data shows.

Supply from the Chevron-led Angola project also seems to have slowed compared with an initial burst of cargoes after the plant restarted in June following a two-year rebuild.

A tender for a fourth Angolan cargo was cancelled last week, and has not been relaunched yet, prompting speculation about operational issues.

In terms of demand, Argentina launched a major buy tender for 10 LNG cargoes, three of which are for the Bahia Blanca terminal with the remainder for the river terminal at Escobar.

Nine of the cargoes are due for September delivery and one shipment is for late August, industry sources said.

A tender Egypt is expected to offer for additional supply may help push prices higher if it materialises next week, they said.

Indian buyers were also heard to be in the market seeking supply.

Shell reported a small fire at the construction site in South Korea for its huge floating Prelude liquefied natural gas (LNG) project, with work resuming immediately and an investigation underway.

France’s new Dunkirk LNG import terminal received its inaugural shipment on Friday from the Madrid Spirit tanker, majority owner EDF said in a statement.

(Reporting by Oleg Vukmanovic; Editing by Ruth Pitchford)

Posted in: Energy News

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