Vopak inks deal with Engro to buy 29 per cent of Pakistan’s first LNG terminal
Global independent tank storage company Vopak said on Friday it has inked an agreement with Pakisan’s Engro Corp to buy a 29 per cent stake in Pakistan’s first liquefied natural gas (LNG) import facility. Vopak will invest in Elengy Terminal Pakistan, whose subsidiary Engro Elengy Terminal Pte Ltd (EETPL) owns the LNG facility in the country’s Port Qasim, it said in a statement, without giving the investment amount. “This new step in our cooperation gives Vopak an excellent entry in the growing Pakistan LNG market,” Eelco Hoekstra, Chairman of the Executive Board and Chief Executive Officer of Vopak, said in a statement. “This fits very well our ambitions to grow and diversify our service offering in LNG.” The transaction is expected to close in the fourth quarter, Vopak said. Jefferies analysts said in a note that the acquisition will cost $38 million. The facility, which started operations in 2015, consists of an LNG jetty and a pipeline connected to a Floating Storage and Regasification Unit (FSRU) which has been chartered by EETPL for 15 years. The pipeline supplies gas directly to the grid of EETPL’s sole customer, state-owned Sui Southern Gas Company. The facility is adjacent to the Engro Vopak chemical storage terminal jointly owned by the two companies. Marquette King Womens Jersey
South Korea LNG imports set to ease from record levels as power firms guzzle less gas
South Korean imports of liquefied natural gas are set to ease from record levels racked up in the first-half of the year, with appetite for the fuel from utilities seen fading as a raft of nuclear power stations come back online. The country’s imports of the commodity jumped nearly 16 percent year-on-year to a record 22.7 million tonnes in the first six months of 2018, according to customs data in mid-July, boosted by demand from power firms as around half the nation’s 24 nuclear plants were shut for maintenance. But with an average of only six reactors expected to be offline over the rest of the year, analysts say shipments of LNG into the world’s No.3 importer of the fuel are likely to decline. “(LNG) demand in the second-half won’t be as strong as in the first-half because nuclear run rates will rise,” said Yang Ji-hae, an analyst at Samsung Securities. South Korea mainly consumes natural gas for heating and cooking, although it has been pushing to use the fuel more in power generation as it looks to switch away from coal and nuclear. Gas power generation made up 29.1 percent of the country’s overall electricity output in January-May, up from 20.4 percent last year, according to Reuters calculations based on data from Korea Electric Power Corp. That compares to the share of nuclear power at 20.8 percent, down from typical levels of around 30 percent. State-run Korea Gas Corp (KOGAS) sold 19.7 million tonnes of gas in the January-June period, up 18.5 percent from last year, data from the country’s sole wholesaler shows. For power generation, 8.7 million tonnes of gas were sold during that period, up almost 31 percent on-year. LOOKING TO WINTER Nicholas Browne, senior gas analyst at energy consultancy Wood Mackenzie, said that full-year 2018 LNG imports were expected to be similar to last year, with South Korean buyers already storing gas ahead of winter. “They are … filling storage in the traditional shoulder months, even if current spot prices are relatively high at $10/mmBtu. It likely means that KOGAS anticipates prices will head higher in the winter,” Browne said. LNG spot prices have averaged $10.03 per million British thermal units (mmBtu) so far this July, up from $5.59 per mmBtu in the same month last year. South Korea imported 37.6 million tonnes of LNG in 2017, customs data showed. KOGAS brings in around 32 million tonnes of LNG a year, with the rest purchased by private gas companies and utilities. Yang at Samsung Securities said demand for gas from the power sector would drop in the second-half, although she added that gas would “benefit from the country’s energy policy in the mid-to-long term”. William Karlsson Womens Jersey
Japan’s LNG imports fall to lowest since May 2016 as nuclear units come online
Japanese imports of liquefied natural gas (LNG) in June fell to the lowest in more than two years as the country’s utilities switched on more nuclear reactors that had been shut in the wake of the Fukushima atomic disaster in 2011. Japan has six reactors operating and three others have passed safety inspections and could be operating by October, allowing utilities to switch away from LNG. Spot prices for the fuel rose to a three-and-a-half-year high in June. Japan, the world’s biggest importer of LNG, brought in 5.55 million tonnes of the fuel in June, down more than 10 percent from a year earlier, official data showed on Wednesday. That was the lowest monthly import number since May 2016. Imports of thermal coal also fell in June, down 18.3 percent from a year earlier, and the lowest since May 2017, the data showed. The Fukushima disaster in March 2011 sparked the country’s worst energy crisis in the post-war period, forcing it to import huge amounts of LNG and driving prices to record highs. They also turned to cheaper coal imports. All of the country’s reactors were eventually shut down to be relicensed under new safety rules after the disaster highlighted regulatory and operator failings. Nine out of 40 commercially operable units have been relicensed under the new rules. One of the three not operating has been shut down by a court order that expires in September, while the other two are under regular maintenance and refueling and due to start operating within weeks. Still, nuclear power remains unpopular in the country and many hurdles remain to get more units operating beyond the nine approved, analysts have said. Frank Clark Jersey
Indian Oil says Rs 4,300 cr Ennore LNG terminal to become operational by October
Indian Oil Corporation (IOC), the nation’s largest fuel retailer, expects its upcoming 5 million tonne per annum Ennore Liquefied Natural Gas (LNG) terminal to start operations by October. The company is setting up the terminal at Ennore near Chennai in Tamil Nadu at a cost of Rs 4,300 crore and has also made a provision to scale up the capacity to 10 million tonne per annum (MTPA), if required. “The Ennore terminal is expected to be complete by October. The physical progress (of the project) is 92 per cent and we expect to complete in three months,” IOC’s Director-Finance A K Sharma said in a recent analyst call. He added that the company has already tied-up off-take agreements for 1.5 million tonne gas with consumers. IOC plans to connect the terminal to its Chennai Petroleum Corporation Limited (CPCL) refinery apart from facilities of Madras Fertilizers, Tamil Nadu Petro Products, Manali Petrol Products and other customers in the area. The firm is also working on laying a 1,385 Km natural gas pipeline originating from the Ennore terminal to Nagapattinam in Tamil Nadu via Puducherry. The fuel retailer is also laying branch pipelines to Madurai, Tuticorin, and Bengaluru to meet the demand from multiple LNG consumers in the region. “As far as the pipeline is concerned, we are very hopeful that the major batch of the pipeline which consists of 23 kilometers primarily connecting the LNG terminal to our various customers in the area, will be completed on time,” Sharma said. The laying of the complete 1,385 Km pipeline will be carried out in phases. IOC is working on a capital expenditure plan of Rs 22,862 crore, up 21 per cent as compared to Rs 18,848 crore spent last financial year (2017-18). Sharma said the firm plans to spend 43 per cent of the current fiscal’s capex on refinery segment, 11 per cent on petrochemical projects, 12 per cent on pipelines, 25 per cent on marketing and the rest on exploration and production, gas projects and alternate energy. Aaron Jones Jersey
Five bid for city gas rights in Burdwan
Five firms, including the Indian Oil-Adani Gas combine, are in the race to supply city gas to households in Burdwan. The district town is part of the 86 other places where firms have bid for city gas distribution rights. Burdwan, the only town in Bengal where the bidding for city gas is taking place, has attracted offers from GAIL Gas, Hindustan Petroleum Corporation, H-Energy East Coast, Bharat Gas Resources and Indian Oil-Adani Gas . The Petroleum and Natural Gas Regulatory Board (PNGRB) said the 9th round of city gas distribution (CCD) was likely to attract investment of Rs 70,000 crore. IOC bid for 34 places on its own and another 20 in partnership with Adani Gas, according to the final bid information provided by the PNGRB. Adani Gas on its own bid for 32 places. Bharat Gas Resources, a unit of BPCL, bid for as many as 53 areas, while GAIL’s retailing arm, GAIL Gas, has put in offers for 34 places. Gujarat-based Torrent Gas bid for 31 places, while Gujarat Gas put in offers for 21 areas. Petronet LNG, India’s largest liquefied natural gas (LNG) importer, sought to foray into the CGD business by bidding for the licence in seven places. Indraprastha Gas, which retails CNG in the national capital region, put in bids for 11 areas. As many as eight places received single bids. Only Indian Oil bid for Aurangabad in Bihar and Rewa in Madhya Pradesh. Similarly, only Adani Gas applied for Balasore in Odisha; GAIL Gas for Gangan in Odisha; Bharat Gas Resources for Bidar in Karnataka and Amethi in Uttar Pradesh; IOC-Adani combine for Allahabad in Uttar Pradesh; and Gujarat Gas bid for Narmada in Gujarat. Josh Kline Jersey