ADNOC Gas Signs LNG Deal With Japanese Energy Giant
ADNOC Gas, the natural gas arm of Abu Dhabi’s state energy group, has signed an agreement with Japan Petroleum Exploration (Japex) to supply liquefied natural gas (LNG) for five years. The LNG supply deal is valued between $450 million and $550 million and “builds on the long-standing bilateral relationship between the UAE and Japan and ADNOC’s track record of fostering mutually beneficial strategic partnerships with Japanese energy companies,” Emirates News Agency quoted ADNOC Gas as saying. Japan, heavily dependent on energy imports, is looking to boost its energy security and lower import bills amid volatile energy commodity prices and altered energy flows following the Russian invasion of Ukraine. Last month, Japanese Prime Minister Fumio Kishida visited the United Arab Emirates (UAE) during a trip in several Arab Gulf states to discuss energy and trade relations. ADNOC and ADNOC Gas, on the other hand, are looking to expand their international presence and have signed several major deals abroad in recent weeks. ADNOC Gas signed in July a long-term agreement to supply LNG to Indian Oil Corporation, in a deal worth between $7 billion and $9 billion. Under the terms of the agreement, ADNOC Gas, the integrated gas unit of Abu Dhabi National Oil Company (ADNOC), will export up to 1.2 million metric tonnes per annum (mmtpa) of LNG to Indian Oil over a period of 14 years, the Abu Dhabi company said in a statement. ADNOC Gas, which supplies around 60% of the UAE’s sales gas needs and has access to 95% of the UAE’s huge gas reserves, looks to expand its global presence as the LNG market grows and countries look to diversify supply to boost energy security. Earlier this month, ADNOC announced it would buy 30% of the Absheron gas field in the Caspian Sea in Azerbaijan by acquiring stakes from the current partners in the field, TotalEnergies and SOCAR. After completion of the transaction, TotalEnergies and SOCAR will each own 35% in Absheron, and ADNOC will have 30% in the gas and condensate field, where first gas was achieved last month.
Russian Crude Oil Discount For India Shrinks
The discount of Russian oil exported to India has tightened considerably, from some $30 to Brent crude last year to as little as $4 per barrel, Eurasia Daily Monitor has reported, adding that shipping costs, on the other hand, have increased. Per the agency, the shipping costs per barrel of Urals sent to India now vary between $11 and $19, which Eurasia Daily Monitor says is higher than the shipping costs for oil imported from other countries at similar distances. Meanwhile, Indian media reported that imports from Russia in the period between April and July doubled to $20.45 billion. This has turned Russia into India’s second-largest supplier of foreign goods, with oil and fertilizers making up the biggest share. In oil, Russia’s share of the Indian import market has ballooned from less than 1% last year to as much as 40% this year. That said, imports of Russian crude oil into India last month dipped and the decline could deepen this month, Kpler predicted recently as Russia pledged to reduce exports in line with OPEC+ efforts to support prices. In July, crude imports from Russia into India, the world’s third-largest oil importer, dropped to 2.09 million barrels per day, down from 2.11 million bpd in the previous month, Viktor Katona, head of crude analysis at Kpler, told Bloomberg earlier this month. At the same time, expectations that the narrowed discount of Urals to Brent would dampen India’s appetite for Russian crude appear to have been wrong. “There was a perception that India had limited capacity to refine medium sour grade of Russian crude, which would create a natural ceiling on Russian imports,” a Citi analyst told Bloomberg this month. “It has now been clearly demonstrated that such a bottleneck does not exist. This would imply that Indian refiners can continue with their Russian oil imports as long as discounts outweigh the higher logistics cost of imports,” Samiran Chakraborty, chief India economist at the Wall Street bank, also said.
APM Terminals Pipavav starts operations of Very Large Gas Carriers
Private port operator APM Terminals Pipavav on Monday said it has commenced operations of Very Large Gas Carriers (VLGCs). The vessel loaded with cargo from Ruwais, ADNOC Refinery Jetty, discharged 21,907 MT parcel at port Pipavav for Bharat Petroleum Corporation Ltd, Indian Oil Corporation Ltd and Hindustan Petroleum Corporation Ltd. The maiden berthing of the vessel MT Jag Viraat happened at the port earlier this month. With a major shift in all India LPG imports to VLGC vessels from earlier Medium Gas Carrier (MGC) ships, the VLGC handling capability at APM Terminals Pipavav becomes critically important. This will allow oil marketing companies to maximise their LPG imports efficiently and safely, the port operator said in a statement. Owned by Great Eastern Shipping Company, MT Jag Viraat is a VLGC vessel is 230 metres long.
CNG sales volume grows 51% in 6 months to March
City gas companies have grown their super-profitable CNG sales volume at a faster rate in the past two years than the less profitable segment of gas supplies meant for homes City gas distributors sold 19.4 million metric standard cubic meters a day (mmscmd) of CNG in six months to March 2023, up 51% from October 2020 to March 2021 period, oil ministry data showed. In the same period, the sale of piped natural gas (PNG) meant for cooking at home rose 11% to 2.9 mmscmd. Sales to commercial customers that includes hotels and malls, dropped 25% to 0.7 mmscmd, while those to industries fell 38% to 10.3 mmscmd as high imported gas prices forced them to switch to alternative fuels As a result, the share of CNG in city gas distributors’ overall sales sharply increased to 58% in two years from 39% in the six months to March 2021. The share of sales to industrial customers fell from 50% to 30%. The share of sales to households, or domestic PNG, rose marginally to 8.7% from 8%.