Analysis
China’s response to the coronavirus outbreak has spawned hydra-headed crises that are now reverberating through global industries, disrupting supply chains and crashing commodity markets. The effect upon LNG has been profound, coming at the worst possible moment as the industry grapples with rock-bottom spot prices. Uncertainties abound, but the crisis seems set to accelerate the industry’s painful evolution.
International
US-based LNG developer Tellurian is looking forward to potentially securing India’s Petronet LNG as a partner in the Driftwood LNG project during US president Donald Trump’s upcoming visit to India, after rival Cheniere dropped a lawsuit against the company and senior executives shortly before the two companies were set to enter court.
BP has delighted investors by hiking its dividend thanks to a notable uptick in operating cashflow and Q4’19 financial results that beat analyst expectations on earnings and revenue.
Oil and gas will remain “foundational” to the global economy out to 2040, ExxonMobil said in its 2020 energy and climate report, which reiterated the US supermajor’s defiant climate message that its reserves face minimal risk of being stranded as the world strives to cut emissions.
Total claimed victory in “solid” fourth quarter 2019 results after it beat analyst expectations and outperformed several of its rivals, which have struggled with the lower price environment and market volatility.
Africa
Mozambique – Maputo has appointed Estevao Pale as the new chairman of state-owned energy firm ENH, which is struggling to secure finance for its share in the Total-led Mozambique LNG project.
Asia Pacific
China – China has begun diverting LNG cargoes amid growing fears that the outbreak of coronavirus is hammering economic activity and gas demand, with mild weather and high storage levels worsening the outlook.
Total has rejected a force majeure notice by a Chinese LNG buyer, with reports suggesting CNOOC declared FM due to constraints caused by the coronavirus. Days later, Shell also rejected a delcaration of FM from a Chinese LNG buyer citing the coronavirus, according to reports that also suggest up to 50 cargoes are at risk of cancellation this month.
UK-listed Energean Oil & Gas has warned that work on its FPSO vessel at China’s Liuheng Island shipyard could be delayed due to travel restrictions aimed at stopping the spread of the coronavirus, adding that force majeure might become necessary.
Caribbean
Trinidad & Tobago – T&T has cancelled its agreement with Venezuela to jointly develop the Loran-Manatee field that straddles their maritime border due to US sanctions on Venezuela’s state-owned oil firm PDVSA.
Europe
EU – Rapid decarbonisation of the European power mix is creating a structural shortfall in demand for CO2 permits, which might crash the carbon market without intervention to delete excess permits, German consultancy Agora Energiewende has warned.
France – Engie’s transformational CEO Isabelle Kocher has been ousted by the firm’s board, which last week agreed against renewing her contract, firing a warning shot over other energy companies seeking to transition to low-carbon business models.
Turkey – Equinor has withdrawn from a partnership with Canada-based Valeura Energy to assess a promising deep gas play in the Thrace region of north-west Turkey.
UK – Decarbonisation of residential heating is the biggest challenge facing the UK energy sector over the coming decades, according to regulator Ofgem, which released its Decarbonisation Action Plan last week.
Middle East
Egypt / Israel – Militants have attacked pipeline infrastructure in Egypt, but failed to do significant damage or impact flows from Israel through the newly reopened East Mediterranean Gas pipeline.
United Arab Emirates – The prime minister has announced the discovery of an 80 Tcf shallow-water discovery, known as the Jebel Ali project that is believed to be the country’s largest ever, and could help the UAE achieve gas self-sufficiency.
North America
Canada – Police moved into First Nations’ territory in a raid last week, as they pushed to reinforce Coastal Gaslink’s injunction, following the collapse of talks between British Columbia province and hereditary chiefs.
US – Institutional investors are grabbing cheap stock in US LNG companies after coronavirus disruption and oversupply crashed the share prices of Cheniere Energy and Tellurian.
South Asia
Bangladesh – Russia’s Gazprom has signed an MoU with state-owned PetroBangla, agreeing to cooperate on appraising a 1.5 Tcf proven resource that might help energy-hungry Bangladesh replenish its fast-depleting reserves.
Subscription Benefits
Our three titles – LNG Business Review, Gas Matters and Gas Matters Today – tackle the biggest questions on global developments and major industry trends through a mixture of news, profiles and analysis.
LNG Business Review
LNG Business Review seeks to discover new truths about today’s LNG industry. It strives to widen market players’ scope of reference by actively engaging with events, offering new perspectives while challenging existing ones, and never shying away from being a platform for debate.
Gas Matters
Gas Matters digs deep into the stories of today, keeping the challenges of tomorrow in its sights. Weekly features and interviews, informed by unrivalled in-house expertise, offer a fresh perspective on events as well as thoughtful, intelligent analysis that dares to challenge the status quo.
Gas Matters Today
Gas Matters Today cuts through the bluster of online news and views to offer trustworthy, informed perspectives on major events shaping the gas and LNG industries. This daily news service provides unparalleled insight by drawing on the collective knowledge of in-house reporters, specialist contributors and extensive archive to go beyond the headlines, making it essential reading for gas industry professionals.
