China Secures Two Long-Term LNG Deals With U.S. Producer
A Chinese company has sealed two 20-year LNG purchase deals with Venture Global, which will see the latter supply two million tons of liquefied gas to China Gas Holdings annually, beginning in 2027. The gas will come from Venture Global’s two projects in Louisiana, Reuters has reported, Plaquemines LNG and CP2 LNG. The Plaquemines LNG facility, currently in construction, will have a capacity of 20 million tons annually when completed. CP2 LNG will also have a nameplate capacity of 20 million tons, with peak capacity of 24 million tons, Venture Global said in a fact sheet. The two contracts with China Gas Holdings add to one it signed with Energy Transfer for the supply of 700,000 tons of LNG annually over a period of 25 years, amid a rush among Chinese energy buyers to secure a long-term supply of liquefied gas. Reuters notes that for Venture Global this is the third recent deal with a Chinese company: last year, the LNG developer signed one 20-year contract with state-owned energy major Sinopec for the delivery of 4 million tons of LNG annually, and another, with a Sinopec subsidiary, for the delivery of another 3.8 million tons per year. China specifically, and Asia as a whole, is being watched by LNG producers as one certain demand growth region, alongside Europe. China is of special interest because, unlike many other Asian economies, it can afford LNG, even at current prices. These are down from last year’s highs but are still higher than before Russia invaded Ukraine. According to one LNG tanker operator, prices will continue trending higher until 2025, driving U.S. LNG investment because of the arbitrage between global and local prices. The CEO of Flex LNG said he expected Henry Hub prices to rise from below $3 per mmBtu now to some $5 by 2025, while Europe’s TTF benchmark and the Asian Japan-Korea Marker top $20 per mmBtu before retreating to $15, according to a conference call cited by Natural Gas Intelligence.
India expects fuel demand to grow 4.7% in FY24
Fuel consumption in 2023-24, a proxy for oil demand, could rise to 233.8 million tonnes from the revised estimate of 222.9 million tonnes for the current fiscal year ending in March, according to government forecasts by Reuters. By Reuters: India’s fuel demand is likely to grow 4.7% in the next fiscal year beginning on April 1, initial government estimates showed. Fuel consumption in 2023-24, a proxy for oil demand, could rise to 233.8 million tonnes from the revised estimate of 222.9 million tonnes for the current fiscal year ending in March, according to government forecasts. The estimates were released on the website of the Petroleum Planning and Analysis Cell (PPAC), a unit of the federal oil ministry. India is the world’s third-biggest oil importer and consumer. Domestic demand for gasoline, used mainly in passenger vehicles, is expected to rise by 7.1% to 37.8 million tonnes, while gasoil consumption was seen growing by about 4.2% to 90.6 million tonnes, the data showed. Indian state refiners’ gasoline and gasoil sales rose in the first two weeks of February from the same period last month, preliminary data showed, boosted by a pick up in transport of goods and mobility. Consumption of aviation fuel would likely increase by 14% to 8.6 million tonnes, compared with the revised estimate of 7.4 million tonnes for the year ending March 2023. Demand for petcoke, a better-burning alternative to coal, could increase 5.8% to 19 million tonnes, while demand for liquefied petroleum gas, used as cooking fuel, is estimated to grow 1.7% to 29.1 million tonnes, PPAC said.
Jio-BP to sell bio-CNG, compressed biogas
Jio-bp, a fuel retail joint venture between Reliance Industries and British oil major BP, will shortly begin retailing compressed biogas (CBG) and bio-CNG (B-CNG), both of which can be used in place of compressed natural gas in CNG-powered vehicles. To begin with, the company will retail CBG and B-CNG at its outlets in western India, and later expand to other outlets, people in the know said. “Jio-bp is actively working on setting up CBG/bio-CNG retailing at its collocated fuel retail outlets and our first outlet is likely to come up soon,” Jio-bp told ET in an emailed response. The company said aligned with its sustainability policies, Jio-bp will convert more and more customers to B-CNG.