International LNG Blog

ONGC to setup LNG import terminal in Karnataka

2013-02-21T06:39:00.001-08:00

Oil and Natural Gas Corp (ONGC) to revive plans to set up a LNG import terminal near its Mangalore refinery in Karnataka.

“In next 10 to 15 days, ONGC and Bharat Petroleum Corp Ltd (BPCL) will sign an memorandum of understanding (MoU) for putting up a LNG terminal at Mangalore,” oil minister M. Veerappa Moily announced at the inauguration of state gas utility GAIL India Ltd’s Dabhol-Bengaluru gas pipeline.

The 5 million ton capacity LNG import facility will be set up through a joint venture of ONGC and BPCL and an international energy firm of repute. ONGC has already initiated talks with Mitsui Group of Japan of setting up LNG terminal at Mangalore and the two may also strengthen their partnership by further setting up a gas based power plant in India.

The Rs4,500 crore Dabhol-Bengaluru pipeline is to be extended to Mangalore by next year and gas imported at the facility can then be pumped into the line for consumption by industries in Karnataka and neighbouring Tamil Nadu.

In 2005, ONGC had plans to build an LNG terminal, which were then shelved in 2006 due to change in leadership. But now the company has again started looking actively at the plan of LNG import, with the clear idea that domestic gas availability at 160 mmscmd in 2015-16 will be way short of demand of 290 mmscmd.

Also, Moily, who hails from Karnataka, is pushing the companies to set up the facility.

BPCL owns an equity stake in a giant gas field off Mozambique and it can ship its share gas in LNG to Mangalore.

India has three operational LNG import facilities—a 10 MMT unit at Dahej in Gujarat operated by Petronet LNG Ltd; a 3.6 MMT terminal of Shell-Total at Hazira in Gujarat, and a just commissioned 5 MMT facility at Dabhol in Maharashtra.

The Dabhol LNG terminal, which has government-owned NTPC Ltd and GAIL as partners, was commissioned last month and a similar capacity import facility will come up at Kochi in Kerala this year. LNG imported at Dabhol and Kochi will feed the same market in Maharashtra, Karnataka, Tamil Nadu and Kerala.

Currently, both Petronet LNG Ltd’s terminal at Dahej, and Shell and Total’s terminal at Hazira in Gujarat are under expansion to 15 MMT and 5 million ton capacity respectively. Even Dabhol is proposed to be expanded to 10 MMT.

Gujarat State Petroleum Corporation invites bids for LNG terminal

2013-02-19T10:00:00.002-08:00

Gujarat State Petroleum Corporation (GSPC) on Feb 19, 2013 invited global bids to select a Engineering Procurement and Construction (EPC) contractor for its 5 MMTPA LNG regasification terminal proposed at Mundra in Gujarat.

The proposed terminal to be set up by GSPC LNG Limited (GLL), a joint venture of GSPC and Adani group, will be set up with an estimated investment of Rs 4,000 crore. "The terminal capacity would be expandable upto 10 MMTPA," official sources said. "GSPC has 50% stake holding in the JV, while Adani group holds 25%, remaining 25% will come from a strategic investor," a GSPC official said.

GSPC has been scouting for a strategic investor for its LNG project, after Essar group — the third partner with a 25% stake in the venture exited from the proposed LNG (liquefied natural gas) terminal.

The LNG terminal is designed to have two LNG storage tanks. It will have LNG receiving, re-gasification and gas evacuation facilities. The LNG terminal proposed to come up at Mundra will be the third one in Gujarat, after Petronet LNG's (10 MMTPA capacity) in Dahej and Shell's Hazira LNG terminal (3.6 MMTPA). The terminal is expected to go on stream by first quarter of 2016, sources in GSPC said.

Reliance, BP to Invest US$5 Bn in India Gas Block

2013-02-19T09:53:00.002-08:00

Reliance Industries said the company and its partner BP Plc plan to jointly invest more than US$5 Bn over the next three to five years to boost output at a key natural gas field off India's east coast.

The D6 block in Krishna Godavari basin is jointly operated by the two energy companies and was expected to contribute up to a quarter of the gas supply for Asia's third-largest economy, but output from the block has been declining.

The two companies are planning to invest in a series of projects to develop around 4 TCF of discovered natural gas resources from the block, Reliance said in a statement.

The current output from the field is about 19 million standard cubic meters a day, less than a fourth of the initial target.

A government panel last month recommended that New Delhi scrap the system of setting natural gas prices based on the fields from where it is produced in favor of a uniform pricing model. The government hasn't yet approved the recommendation which will lead to higher prices.

Reliance currently sells gas from the block at $4.2 per million British thermal unit. The price will come up for revision in April 2014.

CH-IV International to Serve as Owner’s Engineer to Gaz Métro to Provide FEED for LNG Facility

2013-02-07T09:39:00.000-08:00

In Order to Meet Growing Vehicular LNG Demand, Gaz Métro is looking to Expand the Natural Gas Liquefaction Capacity of its Montreal LNG Plant.

HANOVER, MD February 7, 2013 – Jeffrey P. Beale, President of CH-IV International (CH-IV), is pleased to announce that CH-IV International has been selected as Owner’s Engineer to prepare the Front End Engineering Design (FEED) for the expansion of Gaz Métro’s liquefied natural gas (LNG) production facility in Montreal, Quebec. Gaz Métro, the largest natural gas distribution company in Quebec, is currently looking into several solutions for improving the availability of LNG in Quebec and eastern Canada, including the expansion of its Montreal liquefaction, storage and regasification (LSR) plant.

Gaz Métro’s LNG development plan is to supply LNG by truck to the heavy transport industry in eastern Canada, via its indirect subsidiary Gaz Métro Transport Solutions, LP (GMTS), and subsequently to assess the possibility of hauling LNG by truck to service more remote areas from Gaz Métro's natural gas pipeline network. The potential heavy transport industry includes heavy-duty LNG-powered trucks, LNG-powered ferries and a development program for LNG-powered locomotives.

The LSR plant, which supplies Gaz Métro customers during peak gas demand periods, is located in the east end of Montreal and has been operating for more than 40 years. As the present storage capacity of the two existing LNG tanks easily meets current customer demand, Gaz Métro has retained CH-IV to provide the FEED for a project focusing solely on increasing liquefaction capacity. The FEED and EPC bid package should be finalized by the end of March. The current expectations of Gaz Métro are then move to issuance of a request for proposals (RFP) in April for the engineering, procurement and construction (EPC) of the additional liquefaction unit.

CH-IV International had previously prepared a feasibility study to Gaz Métro on various alternatives under consideration. The expansion of LSR’s liquefaction capacity is most likely the first step in meeting an ever increasing demand for vehicular LNG.

Mr. Beale stated, “CH-IV is excited to participate in expanding eastern Canada’s access to clean-burning, economic LNG for both vehicular use as well as fuel oil replacement. As an early promoter of vehicular LNG, I am particularly proud that CH-IV is able to support Gaz Métro’s trailblazing effort.”

Mr. James A. (“Jim”) Kelly, of CH-IV’s Hanover, MD Office, is managing this project.

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CH-IV [read C - H - 4] International (www.ch-iv.com) is a joint venture corporation between MPR Associates, Inc. (www.mpr.com) and CH-IV Cryogenics, LP. CH-IV International provides engineering and consulting services in four overlapping areas involving LNG facilities: 1) Feasibility / Pre-FEED; 2) Front end engineering design (FEED); 3) Engineering oversight and consulting on all things LNG; and 4) Operational services relating to the training, commissioning, start-up and operations of LNG facilities.

The 17th International Conference and Exhibition on Liquefied Natural Gas LNG 17 attracts leading world experts and speakers

2012-10-17T09:36:00.000-07:00

For Immediate Release

Over 5,000 industry professionals expected to gather and chart the course of LNG in the future

16 October 2012, Houston, Texas - The liquefied natural gas (LNG) industry’s top executives and senior decision-makers from major producing and importing countries are confirmed to speak at next year’s largest global gas event.

The 17th International Conference and Exhibition on Liquefied Natural Gas (LNG 17), will take place from April 16 – 19, 2013 in Houston, Texas. It is anticipated that LNG 17 will attract approximately 5,000 senior technical, commercial and strategic experts from over 80 countries. Attendees will have the opportunity to visit more than 300 exhibitors, hear from top-level speakers and attend a variety of networking events.

The scope of the program has expanded to cover strategic, commercial and regulatory issues for the first time, with hundreds of industry experts lined up to speak. For the first time, LNG 17 will feature a new Global Strategy Forum and six Spotlight Sessions addressing the most significant trends, challenges and opportunities facing the industry today and in the future.

The Global Strategy Forum has the confirmed participation of Chief Executives from each of the major gas-producing regions, including: Antoni Llardén, President, Enagás; Maria das Graças Silva Foster, CEO, Petrobras; Wang Dongjin, Vice-President, CNPC; Tom Walters, President, ExxonMobil Gas & Power Marketing; Joseph C. Geagea, Corporate Vice-President & President, Chevron Gas & Midstream; Hamad Rashid Al Mohannadi, Managing Director, RasGas; and Pat Roberts, Managing Director, LNG Worldwide Ltd.

In the Global Outlook for LNG, world-renowned, Pulitzer Prize-winning author, Daniel Yergin, will provide the most up-to-date analysis and forecast of trends in the global gas industry, with an emphasis on the role that LNG will play.

At a macro-economic level, Robert Lesnick, Oil and Gas Program Manager, The World Bank will cover The Opportunities for LNG to Stimulate Economic Development looking at how developing countries around the globe face an exciting opportunity to grow in a more carbon friendly manner. He will also address the role of government policy and natural gas-based industrial development and what the positive impacts are on local development.

The spotlight session on the North American LNG Market will cover the implications of North American LNG exports on global dynamics, with three speakers bringing insight and experience from very different parts of the US LNG market. Betsy Spomer, Head of Global LNG, BG Group will look at Gulf Coast imports and exports, Phil Ribbeck, President, Repsol Energy North America will concentrate on Atlantic Coast trade and Janine McArdle, Senior Vice President – Gas Monetisation, Apache Corporation will focus on Canadian West Coast exports.

Joining the line-up of industry luminaries addressing the conference is Alexander Medvedev, Deputy Chairman of the Management Committee, OAO Gazprom & Director-General, OOO Gazprom Export who is slated to deliver a session on The Role of Russia in the Global LNG Industry. The session will deal with issues surrounding Gazprom’s portfolio optimization and other exciting developments from one of the world’s largest gas producers.

Anders Ekvall, Vice-President LNG Americas, Shell will speak on Upcoming Trends in the Transportation Sector - one of the largest consumers of LNG - while Jean-Marie Dauger, Executive Vice President, GDF Suez will take the stage on Technological Innovation and Infrastructure in the LNG Industry. This includes a preview of new technological infrastructure advances, floating LNG projects and their impact in opening up new markets.

“We have received over 400 abstracts from leading industry professionals, which is the largest number ever submitted for this event. The exclusive conference sessions will consist of formal presentations, which have not been previously delivered, as well as highly focused workshops with topics on market, finance and technology issues related to the industry,” said David Carroll, President and CEO of Gas Technology Institute and President, IGU 2015 – 2018.

“LNG 17 will bring together all the major energy companies in the world to hear from industry experts on current developments, trends and opportunities for LNG in North America and around the world,” said said Larry Borgard, President and COO, Utilities, Integrys Energy Group; Chairman, AGA.

“Natural gas is helping to stimulate economic recovery in the United States and this conference will provide valuable information on potential growth markets like transportation, as well as an understanding of the global demand for natural gas and what that could mean for the United States in the future.”

To register for LNG 17, visit www.lng17.org or email: registration@lng17.org. Save $300 if you register by November 5, 2012.

About LNG 17

Hosted by The American Gas Association, LNG 17 is the only global industry event conducted by the gas industry – three industry organizations are responsible for the event: the International Gas Union, the Gas Technology Institute and the International Institute of Refrigeration

Liquefied natural gas industry faces skills crunch

2012-06-12T10:48:00.000-07:00

Total has added its weight to the skills shortage debate, warning Julia Gillard of a looming crunch in the booming LNG industry.

Speaking at the World Gas Forum in Kuala Lumpur at the end of last week, Total chairman and chief executive Christophe de Margerie said he had raised the issue when he met the Prime Minister two weeks ago.

"It is true that in Australia, especially with a long-term view, it may become short of skills if you want to develop all of those LNG projects in the northwest (of Western Australia), Darwin and Brisbane," he said. "It's up to the government to see what they have to do. What we raised with the government is, 'Be careful'."

Total has a 24% stake in the $34 billion Ichthys development and a 27.5% interest in the under-construction $16Bn Gladstone LNG project in Queensland. Together, the projects will employ several thousand people while they are built.

With more than a dozen LNG projects representing about $200Bn in investment either under construction or planned for development here, competition for skills has already intensified and developers have looked overseas for labour.

Woodside Petroleum's Pluto LNG project relied on 457 visas to import skilled workers for specialised short-term jobs in the project's construction. A number of other LNG projects planned or being built are expected to use Enterprise Migration Agreements that allow the import of labour from overseas.

Companies such as Woodside and Royal Dutch Shell have also considered building plant components overseas to avoid higher labour costs in Australia.

Mr Margerie said labour issues were less significant in Darwin, where the Ichthys LNG plant would be built, as it was the only plant under construction there.

The issue was more apparent in Queensland given the number of competing projects, he said, with Total having sent expatriates from France and other nations to work on the development.

Mr Margerie confirmed Total would exercise its option to lift its interest in Ichthys from 24% to 30% in a matter of "days or weeks".

Separately, the head of integrated French energy company GDF Suez said Europe could meet its ambitious emissions targets at a significantly cheaper cost if it focused more on gas instead of renewable energy.

GDF Suez chairman and chief executive Jean-Marie Dauger said a greater focus on gas could shave E400Bn to E500Bn ($500Bn-$630Bn) off the estimated E1.2 trillion in costs by 2030 under Europe's emissions reduction plans. Using more gas to cut emissions could also protect 20-25 million jobs in Europe.

"Today this issue of economic optimisation of the energy mix simply cannot be ignored at a time of extreme financial and economic instability," Mr Dauger said.

"It is essential that the affordability of energy policies is seriously considered."

BPCL, Videocon Mozambique gas discoveries hold big reserves

2012-06-12T10:42:00.000-07:00

Bharat Petroleum Corp Ltd (BPCL) and Videocon Industries' Mozambique gas discoveries may hold up to 100 trillion cubic feet of in-place reserves, the block operator said.

US energy major Anadarko Petroleum Corp said the total estimated recoverable natural gas resource in Offshore Area 1 was between "30 and 60 Tcf, and the current upside for total gas in place for the discovered reservoirs on the block is approaching 100 Tcf".

Bharat PetroResources Ltd, a wholly owned subsidiary of BPCL, and Videocon Hydrocarbon Holdings Ltd, a wholly owned subsidiary of Videocon Industries, hold 10% stake each in Area--1.

Anadarko, which holds 36.5% interest in the block, plans to put up plants to liquefy the gas (liquefied natural gas or LNG) so that it can be shipped to consumption centres in cyrogenic ships. The two LNG trains will have the capacity to produce 5 million tonnes of liquid fuel each.

First gas exports from an initial train is expected in 2018 and the second train in 2010. A final investment decision is scheduled for late 2013, it said.

Anadarko said in a statement that its "Atum exploration well discovered another significant natural gas accumulation within the Offshore Area 1".

The Atum discovery well, which encountered more than 300 net feet (92 meters) of natural gas pay, is connected to the recent Golfinho discovery located approximately 16.5-km to the northwest in the Offshore Area 1.

"We estimate this new complex, which is located entirely within the Offshore Area 1 block, holds 10 to 30-plus Tcf of incremental recoverable natural gas resources," said Bob Daniels, Senior Vice President at Worldwide Exploration. "We plan to immediately commence a four-well appraisal programme of this complex, which has the potential to underpin a large LNG development."

The reserves are more than the 11 Tcf of resources in Reliance Industries' eastern offshore KG--D6 fields. RIL had in 2010 produced over 61 million standard cubic metres per day of gas from its KG--D6 gas discoveries before technical problems led to a drop in output. The output is enough to produce about 15 million tonnes of LNG per annum.

Anadarko estimates that there is sufficient gas in place in Area-1 for up to 10 LNG trains for a total of 50 million tons ayear of LNG capacity.

Cove Energy Mozambique Rovuma Offshore Ltd holds 8.5% interest in the block and Mitsui E&P Miozambique another 20%. The balance 15% is with Empressa Nacional de Hidrocarbonetos (EIH), the national oil company of Mozambique.

Reliance Industries planning US$1.2 Bn LNG terminal

2011-01-07T13:19:00.000-08:00

Reliance Industries Ltd (RIL) is considering putting up a US$ 1.2 Bn LNG import terminal on the east or west coast to meet demand at its refineries and petrochemical plants.

According to report, Reliance's requirement of the fuel is around 14 MMSCMD at its twin refineries at Jamnagar in Gujarat. It also needs gas at its petrochemical plants.

The company had first contemplated the facility back in 1997, but plans for a 5-MT per annum port terminal were later held back, the report said. The company had at that time envisaged receipt of LNG transported from overseas via cryogenic ships and a re-gasification of the liquid cargo.

The company is now thinking of reviving the plan as it is not able to use the natural gas from the eastern offshore KG6-D6 field given that its twin refineries at Jamnagar have been allocated only 2.34 MMSCMD of the 60 MMSCMD of gas that the government has earmarked for various users.

Reliance is reported to be buying LNG from Royal Dutch Shell at prices that are in double digits as against a delivered price of US$7 per million Btu of KG-D6 gas.

The report said that Jamnagar was the natural choice, but Gujarat already has LNG terminals at Dahej, operated by Petronet LNG and another at Hazira owned by Shell India and Total of France.

According to the report, a third terminal was under planning stage at Mundra by the Adani Group and Gujarat government entity GSPC), and therefore a fourth one in the state looked unlikely.

One option is to set up the facility at Kakinada in Andhra Pradesh and transport the gas via the under-utilised East-West pipeline connecting the landfall point for gas from the eastern offshore KG-D6 field to Baruch in Gujarat.

The pipeline has the capacity to move 100 MMSCMD of gas. However only half the capacity is being used given the production constraints at KG-D6 field, which has an output of 54 MMSCMD at present.

Another option under consideration is using a floating LNG facility that would receive cryogenic ships at high sea and regasify the liquid cargo into natural gas before piping it to shore through a submarine pipeline.

According to the report Reliance's LNG terminal is expected to take 1 1/2 years as against 36-40 months for a normal LNG terminal.

It added that Reliance had also explored the possibility of picking up a stake in Adani's proposed LNG terminal at Mundra, but the two sides failed to reach an agreement.

In 2000 the company had also tied up LNG imports from Iran but then dropped the plan following the huge gas reserves it struck off the Andhra coast.

Meanwhile, the company has commissioned its business transformation plans for 2012 and has engaged AT Kearny, Booz & Co for the business transformation.

According to reports, Reliance would finalize its US$5 Bn investment plans at Jamnagar in 2011. The plans include new cracker and downstream expansion.

Also the assessment on building and LNG Terminal would only be taken in 2011.

RIL is also said to have revived its talks with British Petroleum to sell a stake in its E&P assets.

Approval for Masela LNG

2010-12-13T12:17:00.000-08:00

Indonesia has approved a development plan for a LNG floating terminal project run by Japan's Inpex Corp.

The floating LNG project will have capacity of 2.5 MMTPA, lower than a previously proposed capacity of 4.5 MMT, said Evita Legowo, director general of oil and gas at the energy and mineral resources ministry.

The project will cost an estimated US$ 4.9 Bn.

Inpex has a majority stake in the Masela block in Maluku province while PT Energy Mega Persada , a unit of the Bakrie Group, has a 10% stake in the oil and gas block.

Former OPEC member Indonesia, which has far more gas than oil, has pushed companies to move faster in developing gas projects as the country badly needs the fuel for domestic industrial demand as well as for exports.

CH-IV International To Support U.S. LNG Export Project On Behalf Of Freeport LNG Expansion, L.P.

2010-11-22T21:42:00.000-08:00

Freeport LNG Expansion, L.P. and Macquarie Energy to Jointly Develop LNG Export Project.
HANOVER, MD November 22 – Jeffrey P. Beale, President of CH-IV International (CH-IV) is pleased to announce that CH-IV International will continue its Owner’s Engineering support for Freeport LNG Expansion, L.P. (Freeport LNG) for their recently announced project with Macquarie. CH-IV International had previously been contracted by Freeport LNG to execute a Pre-FEED for the LNG Export Project, which included the evaluation and selection of the Liquefaction Technology. As part of the overall FEED for the expansion project, CH-IV will continue its support to Freeport LNG by managing and contributing to the preparation of the required Resource Report 13 (RR13) for the NEPA Pre-filing Process with the Federal Energy Regulatory Commission (FERC).

The Freeport LNG import terminal located on Quintana Island, Texas commenced commercial operations in June 2008. Since commercial operations began, the terminal has seen a limited number of import cargos due to higher global LNG prices relative to natural gas prices in the United States, and the significant increase in domestic gas supplies due to recent advancements in shale gas technology.

Mr. Beale stated, “CH-IV is excited to continue working with the Freeport LNG Team on such an important project. We look forward to adapting the current infrastructure to meet new commercial goals while maintaining the existing high levels of safety and operational proficiency.”

“We look forward to continuing the relationship we have developed with CH-IV in evaluating various potential opportunities for our terminal.” stated Charles Reimer, Freeport LNG President. “Supplementing our existing import terminal with the capability to produce and export LNG provides Freeport LNG with new opportunities to maximize the value of our assets on Quintana Island.”

Mr. Michael Diemert, of CH-IV’s Houston Office, will manage this project.

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CH-IV [read C - H - 4] International (www.ch-iv.com) is a joint venture corporation between MPR Associates, Inc. (www.mpr.com) and CH-IV Cryogenics, LP. CH-IV International provides engineering and consulting services in four overlapping areas involving LNG facilities: 1) Feasibility / Pre-FEED; 2) Front end engineering design (FEED); 3) Engineering oversight and consulting on all things LNG; and 4) Operational services relating to the training, commissioning, start-up and operations of LNG facilities.

Follow activities in the LNG industry and CH-IV
by clicking on http://twitter.com/LNGSpecialists

# # # #

CH·IV International to provide Consulting Services to Bangladesh LNG Project

2010-11-15T21:45:00.000-08:00

Bangladesh is seeking solution to energy crisis due to the gas supply shortfall.

HANOVER, MD November 15 – Jeffrey P. Beale, President of CH·IV International (CH·IV), is pleased to announce that CH·IV International, in association with the Galway Group LP, will provide support to Bangladesh’s state-owned Petrobangla in acquiring firm LNG supply and design and construction of the country’s first LNG import terminal. Chief of the Bangladesh LNG Cell Md Muqtadir Ali said, “The company (CH·IV) was selected on the basis of its experience in negotiating LNG supply agreements, pricing, LNG shipping and development of LNG import terminals.” Mr. Muqtadir, who previously served as the acting chairman of Petrobangla, added “We have already issued a letter of intent to award the contract to the U.S firm.”

Mr. Beale pointed out that CH·IV emerged as the clear winner out of the 28 global companies that had participated in the Technical Advisor tendering process. Further Mr. Beale stated, “The Team of CH·IV and Galway provide the proper mix of strong talent to address the many dimensions of this world class LNG project.”

The Team’s support of Petrobangla is further strengthened by Galway’s recently announced expansion into Singapore and the addition of Mr. Veldanda V. Rao as the Managing Director of Galway's Asia energy consulting practice. Mr. H.J. Miller, one of the founding partners of Galway, said, "We are very pleased to have this opportunity to utilize our Asia based consulting strengths on behalf of this exciting new LNG project for Bangladesh."

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FERC imposes new vapor rules on Weaver's Cove LNG

2010-10-12T14:00:00.000-07:00

FERC has informed Weaver’s Cove Energy that the company must comply with new vapor-gas exclusion zone requirements before moving forward with construction of the planned LNG terminal.

In a letter issued from FERC to Weaver’s Cove attorney Bruce F. Kiely, the director of FERC’s office of energy projects informed the company that it must receive written authorization from FERC before constructing any facilities associated with the project. That authorization, the letter states, “will only be granted following a determination that the facilities are in compliance with the interpretations issued by” the Pipeline and Hazardous Materials Safety Administration of the U.S. Department of Transportation.

The PHMSA issued two interpretations in July concerning the flammable vapor-gas exclusion zone requirements, saying that the interpretations apply to any LNG facility that is not yet in existence or under construction.

Two city residents raised objections with the U.S. Department of Transportation and FERC earlier this year in regards to Weaver’s Cove’s use of an outdated dispersion called SOURCE5 to show that vapor gas would not leave the company’s Fall River site.

Residents John Keppel and Michael Miozza argued the SOURCE5 model used by Weaver’s Cove resulted in a vapor dispersion model that showed vapors would remain within the company’s property. Keppel said at the time the SOURCE5 model creates “artificially small vapor zones.”

They argued that under different models the vapor dispersion would travel beyond the company’s boundaries, over private residences and possibly to Route 79.

In response to those concerns, the U.S. DOT informed the pair in July that the SOURCE5 model can not be used to comply with the agency’s vapor gas dispersion exclusion zone requirements. A similar determination was made in regards to the proposed Downeast LNG proposal for Robbinston, Maine.

KOGAS's Strategic LNG deals in Australia, Indonesia

2010-10-12T06:47:00.000-07:00

Korea Gas Corp (KOGAS) is planning to acquire stakes in Australian and Indonesian LNG projects to secure stable supplies, the state-run utility said in a report.

The world's largest LNG buyer said it was in talks to acquire a 15% stake in a coal seam gas project led by Australia's Santos Ltd and a 9.8% stake in Indonesia's Senoro Toili project run by Japan's Mitsubishi Corp.

The company did not provide a financial value for either of the potential deals, but sources with knowledge of the Australian deal said in August that KOGAS would invest more than US$1 Bn in the Santos's Gladstone LNG (GLNG) project.

"The US $1 Bn fundraising report lends credence to the first report that KOGAS will take a larger 15% of GLNG, rather than the 10 percent commonly reported previously," said Benjamin Wilson, an analyst with JP Morgan in a note.

"We think this news implies Kogas is confident it will achieve Korean government approval to contract/purchase soon," Wilson said.

Total paid US$597.4 MN for 15% of the coal seam gas-fed LNG project in Australia's north east state of Queensland in September.

Santos currently owns 45% of Gladstone, Petronas has 35% and Total holds 20%.

In addition to buying a stake in the GLNG project, KOGAS has also been expected to sign an offtake agreement for 2 million tonnes per annum of LNG from the project.

The state-run utility sold 24.6 MMT of LNG in 2009 and said in February that it was planning to spend about US$895.4 MN this year on overseas resource development to secure energy supplies for Asia's fourth-largest economy.

LNG Report - International LNG market likely to balance in 2011 as demands grows

2010-09-18T00:54:00.000-07:00

The International LNG market will likely come back into balance in 2011 as demand grows considerably this year and the next, absorbing the projected supply growth, BofA Merrill Lynch Global Research said in a report.

The bank said it was projecting total International LNG import growth of 18% for 2010, followed by 9% in 2011, with the bulk of the increase coming from Asia and Europe. "We believe the risk of an influx of LNG imports to the US is low," it added, since it expects US gas prices to remain "very weak."

The UK could become the world's fourth-largest LNG importer in 2010, after Spain, with imports up 120% year on year "potentially exceeding 11.6 MMT," it said. "In general, UK LNG utilization rates at regasifcation capacity still remains low, suggesting room for further liquid gas imports into the UK."

In Asia, China and India have expanded their import capacity, the bank said, while South Korean and Japanese imports had "surprised to the upside, though largely driven by a hot summer." And "new joiners" such as Argentina, Brazil and Chile would also soak up some of the expected growth in supply, it added.

Global LNG supply would likely grow 14% in 2010 and 9.6% in 2011, the bank said. It added, however, that a number of issues "are clouding the supply outlook of existing facilities." Those include rising use of domestic gas among some exporters, technical issues "as seen with RasGas Train 7 and Tangguh in Indonesia," and maintenance of LNG trains, particularly in Qatar.

"Combine the strong rebound in LNG demand with the startup delays at Qatargas Trains 6 and 7 into next year, and we get a global LNG market in 2010 that is less loose than commonly expected," the bank said.

As a result, it added, the market would "likely be able to rebalance over the course of 2011."In level terms," the bank added, the market would remain oversupplied in both 2010 and 2011 due to utilization rates at liquefaction terminals remaining below 90%, however.

LNG production reached a total of 181.7 MMT in 2009, according to independent consultant Andy Flower.

Roberto R. Vara returns to CH·IV International

2010-07-14T06:23:00.000-07:00

HANOVER, MD July 14 – Jeffrey P. Beale, President of CH·IV International (CH·IV) is pleased to announce that Roberto Ruiperez Vara has returned full-time to our Hanover Maryland Corporate Office. Mr. Vara will provide technical consulting engineering services to clients involved in the pretreatment and liquefaction of natural gas and the transportation, importation, storage and re-gasification of Liquefied Natural Gas (LNG). Mr. Beale stated, “Roberto has played a very significant role in CH·IV’s success before leaving for Chile. I know, with his return, our clients will benefit from his wealth of experience and expertise.”

Mr. Vara took over the role of Operations Manager at the GNL Quintero LNG import terminal in Quintero Bay, Chile in May of last year. There he oversaw cooldown and start-up of the world’s first of its kind “Early Gas” LNG Import Terminal, where LNG transfers are batched into a small land-based tank (10,000 cubic meters) with a LNG carrier permanently connected to the jetty, until the complete terminal (2 x 160,000 cubic meter LNG tanks) construction could be completed. As Simultaneous Operations (SIMOPS) Coordinator, he established and managed a Permit to Work System that allowed approximately 200 construction workers to complete the LNG terminal constructions while day-to-day LNG sendout was taking place.

Construction of the entire terminal was completed in late Spring, at which time Roberto directed Operations through start-up. Mr. Vara completed his obligation in Chile upon establishment of normal operations of the GNL Quintero LNG import terminal.

The GNL Quintero LNG import facility is comprised of three LNG tanks (one x 10,000 cubic meter and two x 160,000 cubic meter); two x 175 mmscfd open rack vaporizer systems; one x 175 mmscfd submerged combustion vaporizer system; six first stage, in-tank LNG pumping systems; one recondenser and BOG recovery system, three x 1,600 gpm high pressure LNG pumping systems; a 6,000 foot long LNG Transfer System and a marine LNG carrier berth.

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CH·IV [read C - H - 4] International is a joint venture corporation between MPR Associates, Inc. and CH·IV Cryogenics, LP. MPR, founded in 1964, specializes in technical services for the development, design, construction and operation of power facilities and equipment for energy, industrial, pharmaceutical and government clients. CH·IV Cryogenics, founded in 1994, had been providing LNG engineering and consulting services to a wide base of clients ranging from international LNG trading to LNG vehicle fleets until the formation of CH·IV International in 2001.

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YPF, Enarsa To Build LNG Plant Near Buenos Aires

2010-06-04T23:17:00.000-07:00

Argentine oil company YPF SA, the local unit of Spain's Repsol YPF SA, will build a LNG plant about an hour north of Buenos Aires.

The LNG plant, which will cost around $150 million to build, will be financed equally by YPF and the state energy company Enarsa.

The government typically rations gas to industrial firms during Argentina's cold winter months, which run roughly from May through September.

Argentina already gets LNG from a regasification vessel located at the southern port of Bahia Blanca in the province of Buenos Aires.

Argentina also imports natural gas from Bolivia, but the amount of gas produced domestically, coupled with imports, still fails to meet demand during the winter, leading to rationing.

Argentine President Cristina Fernandez said that her government is working with Uruguay on the construction of an LNG plant, though she didn't provide more details. Presidents of the two countries are thought to be nearing finalization of plans to build a regasification plant near the Uruguayan capital of Montevideo.

Since an economic meltdown in 2002, the government has kept most energy prices and utility rates frozen partly because of its belief that rates should be kept low to help spur growth in other areas of the economy.

But the price controls have crimped profits for oil and gas companies and given them a disincentive to invest in exploration and production.

As a result, Argentina's oil and gas reserves have fallen while demand has risen, creating an energy crunch that has sometimes led to blackouts and rationing.

Argentina gets more than 90% of its energy from oil and gas. Energy experts say the country depends more on natural gas than any other nation in the region.

A K Balyan to head Petronet LNG

2010-06-03T23:09:00.000-07:00

Petronet LNG, India's largest LNG importer, has appointed Ashok Kumar Balyan as new Chief Executive Officer and Managing Director.

Balyan, who currently is Director for Human Resources and Business Development in Oil and Natural Gas Corporation, has accepted the offer made at the meeting of board of Petronet (PLL).

Balyan will now resign from ONGC and is likely to join PLL by month end. He is due to retire from ONGC on July 31, 2011, on attaining superannuation age of 60 years.

South Hook LNG terminal in UK completed

2010-04-06T07:23:00.000-07:00

The second part of Europe's largest LNG terminal at South Hook in Wales has been fully commissioned, doubling the amount of gas it can deliver into the UK gas grid to 21 BCM a year, the operator said.

The first phase of the terminal owned by U.S. oil major ExxonMobil, Qatari gas giant Qatargas and France's Total officially opened in May 2009.

The first two storage tanks at the facility in the port of Milford Haven, each the size of London's Albert Hall concert venue, were brought into service a year ago. The three extra tanks and other equipment commissioned since then increase the terminal's total processing capacity to 15.6 million tonnes per year of LNG.

Most of South Hook's LNG will come from Qatar. Britain hopes increased LNG import capacity will help compensate for decling North Sea gas production.

(Reuters)

Natural Gas Outlook This Week

2010-03-20T08:31:00.000-07:00

Prices

Natural gas spot prices continued declining this week, reflecting moderating demand as temperatures warmed in key high-demand areas of the country. Spot prices at market locations across lower 48 States fell since last Wednesday, March 10, with decreases ranging between 4 and 26 cents. Prices at trading locations serving demand centers in the Northeast also fell significantly on the week, as spring-like temperatures arrived. The spot price at the Algonquin Citygate, which delivers natural gas to markets in New England, fell 19 cents or about 4 percent on the week. Transcontinental Pipeline’s delivery into New York City was priced at $4.58 per MMBtu yesterday, 18 cents, or 3.8 percent, lower than the previous Wednesday.

Prices at trading locations serving markets in California registered some of the biggest declines since last Wednesday, particularly the southern portion of the State where temperatures continued to moderate. Natural gas spot price at the Southern California Gas Company’s market location fell 22 cents or about 5 percent since last Wednesday, ending trading yesterday at $4.49 per MMBtu. Prices at the Pacific Gas and Electric trading location, which serves markets in northern California also decreased significantly on the week, falling by 21 cents. However, despite the significant price decline, this location was the highest-priced in the lower 48 States as of yesterday, ending trading at $4.81 per MMBtu. The high price at this location and its spread compared with the Henry Hub and trading locations in the Northeast is the result of several factors. These factors include BENTEK Energy estimates, which show that since the middle of 2009, electric generators in the Western United States have been using more natural gas compared with the 5-year (2005-2009) average. The increased power burn is likely the result of a reduction in hydroelectric power generation in the Pacific Northwest and California because of lower precipitation and drought conditions. Furthermore, natural gas is replacing the 1,100 megawatts of electric power that Unit 2 of the San Onofre Nuclear Generating Station (SONGS) previously generated. SONGS Unit 2 has been out of service since September 2009 for steam generator replacement.

While temperatures in the Rocky Mountain States increased slightly during the report week, they continued to hover in the 30s and 40s. Still, the price of natural gas fell substantially in a few market locations in the Rockies. The highest net weekly price drop occurred at Northwest Pipeline’s Sumas location, which fell by 26 cents or 5.7 percent per MMBtu since last Wednesday. The Sumas premium over Henry Hub decreased from 14 cents to 5 cents per MMBtu as of yesterday. Additionally, prices at Kingsgate in Idaho and Stanfield (for delivery into Oregon) fell by 23 and 22 cents per MMBtu, respectively. Overall, trading locations in the Rockies registered net weekly decreases between 4 and 26 cents per MMBtu.

The across-the-board price decreases likely resulted from the significant reduction in total U.S. demand. Total demand for the week ended March 17 fell by 8.6 percent compared with last week, according to BENTEK Energy. Consumption in the residential and commercial sectors fell by 12 percent, contributing to the week-to-week decline. The majority of the decrease in this sector occurred between Monday and Wednesday of this week, as temperatures rose in areas east of the Rockies. The electric power and industrial sectors also recorded demand decreases of 8.6 and 2.3 percent, respectively.

Natural gas supply exceeded total demand for 3 days this report week, the first time the estimated supply/demand balance was positive since November 26, 2009. However, total natural gas supply fell this week, a result of the decrease in Canadian and liquefied natural gas (LNG) sendout, according to BENTEK. Canadian imports decreased by almost 2 percent compared with last week, while LNG sendout fell by nearly 9 percent over the same period. U.S. natural gas production was flat compared with last week, with volumes totaling only 0.1 percent lower. Total supply of natural gas this week was 0.4 percent lower than last week and 2.2 percent lower than last year for the same week.

At the NYMEX, the price of the near-month contract for April delivery decreased by 26 cents during the report week to $4.303 per MMBtu. The price of the April futures contract has decreased fairly consistently since becoming the near-month contract on February 25, falling 46 cents during the period. Remaining contracts for delivery through the end (October 31, 2010) of the upcoming injection season posted similar decreases, ranging between 4.7 and 5.5 percent. Prices on the futures market likely reflect the arrival of spring-like temperatures and continued strength in natural gas production. With only about 2 weeks left in the traditional heating season, which will officially end on March 31, supplies of natural gas are relatively ample. Robust domestic production coupled with the possibility that natural gas inventories in underground storage may close the heating season at about last year’s level could provide considerable downward pressure on prices. Inventories of natural gas in underground storage ended the 2008-2009 heating season at 1,656 Bcf, the highest level since the 2005-2006 heating season ended with 1,692 Bcf of natural gas in storage. The 12-month strip traded yesterday at $4.919 per MMBtu, 22 cents or 4.3 percent lower than last Wednesday.

Storage

Working gas in storage decreased to 1,615 Bcf as of Friday, March 12, according to EIA’s Weekly Natural Gas Storage Report (see Storage Figure). The implied net withdrawal was 11 Bcf, significantly below both the 5-year (2005-2009) average withdrawal of 65 Bcf, and last year’s net withdrawal of 42 Bcf for the report week. The East and West regions both noted net withdrawals for the week; however, storage operators in the Producing region reported the first regional net injection of the season of 14 Bcf. This net injection in the Producing region reduced the storage deficit compared with last year to 135 Bcf, down from 145 Bcf last week. With less than 3 weeks left in the current heating season (November 1-March 31), natural gas stocks in underground storage are on pace to finish the heating season above the 5-year average. If the remaining withdrawals equal the 5-year average withdrawals and injections for the remainder of the month, natural gas stocks would end the heating season at 1,557 Bcf, about 73 Bcf above the 5-year average.

Temperatures in the country were generally warmer than normal for the week ended March 11, with total heating degree-days falling short of normal levels by about 10 percent. Based on the National Weather Service’s degree-day data, temperatures in the United States were 2 degrees warmer than normal, but 3 degrees colder than last year. Four Census Divisions in the Northeast and the Midwest recorded average temperatures that were more than 5 degrees warmer than normal (see Temperature Maps and Data). The West South Central Census Division, which roughly coincides with EIA’s Producing Region, also experienced above-normal temperatures. Despite relatively warmer temperatures in the Northeast and the Midwest, these areas remained cold and registered the lowest temperatures in the country for the week ended March 11. Elsewhere in the United States, average temperatures ranged between 39 and 67 degrees.

Other Market Trends

EIA Highlights Differences between Projections and Actual Values in AEO. On March 16, EIA released its Annual Energy Outlook (AEO) Retrospective Review, which presents a comparison between projected data for all fuel types in the AEO reference case and the actual outcomes from 1982 to 2009. The report measured the average absolute percent difference, which is the simple mean of the absolute values of the percentage difference between the reference case projection and the actual value. The report concluded that consumption forecasts for most fuel types were often far more accurate than price forecasts, as consumption is relatively more stable compared with energy prices. However, the fuel with the largest difference between projections and actual consumption was natural gas, the result of difficulty in forecasting the effects of regulatory changes in the 1980s. Regarding other natural gas data, EIA’s forecasts were generally 57.6 percent off for wellhead prices; 7.1 percent for consumption; 6.2 percent for production; and 15.6 percent for net imports when the time frame between 1982 and 2009 is analyzed. EIA noted that expectations of technological improvement within the natural gas industry embedded in early editions of the AEO were somewhat conservative, further affecting the accuracy of forecasts. Additionally, despite the large difference between projected and actual wellhead prices from 1982-2009, the error has decreased over time. For example, the AEO had an absolute relative error for natural gas wellhead prices of 7.5 percent in 2006, no error in 2007, and 0.2 percent in 2008. In general, longer-term price forecasts were more inaccurate.

Shale Will Play a Greater Role in Natural Gas Production. Speaking on March 12 to Clean Skies News at the Cambridge Energy Research Associates energy conference (CERAWeek) in Houston, Texas, EIA Administrator Richard Newell discussed increasing prospects for natural gas production from shale formations, as well as the role of natural gas in power generation. Newell noted that shale gas production comprises an increasing percentage share of dry natural gas production, totaling 11 percent in 2009. Over the next 25 years, shale is expected to account for more than 25 percent of dry natural gas production. Newell noted that the electric power sector will contribute substantially to growth in natural gas consumption. Newell also discussed the role renewable energy sources will play in reducing greenhouse gas emissions. A video of Newell speaking is available here: http://www.eia.doe.gov/neic/press/video/video.html

Natural Gas Transportation Update

- Southeast Supply Header, LLC (SESH) has begun planned maintenance on several compressor units, reducing available capacity through associated stations on its system. On March 15, work began at the Lucedale Compressor Station in Mississippi. SESH’s capacity through the Lucedale station during maintenance will likely be approximately 870,000 decatherms (Dth) per day, compared with normal capacity of about 1,060,000 Dth per day. From March 18–20, maintenance will occur at the Gwinville Compressor Station, also in Mississippi, where capacity will be limited to 920,000 Dth per day. Lastly, maintenance at the Delhi Compressor Station in Louisiana between March 22 and 27 will limit capacity through the Delhi and Gwinville compressor stations to 800,000 Dth per day. Normal operating capacity through the Delhi and Gwinville stations is 1,020,000 and 1,060,000 Dth per day, respectively.

- Gulf South Pipeline Company LP began maintenance on Unit #3 at Marksville Compressor Station in Louisiana on Tuesday, March 16. According to the pipeline company, work is expected to last 30 days, likely reducing capacity through the station by 150,000 Dth per day. The pipeline company moved up the maintenance from an original start day of March 29.

- Rockies Express Pipeline LLC (REX) on Monday, March 15, informed shippers that it had completed repairs at its compressor station in Cheyenne, Wyoming, returning capacity to 1,900,000 Dth per day. The capacity of REX’s segment 200 in Wyoming had been reduced to 1,550,000 Dth per day on March 7 because of repairs on a transformer at the compressor station.

- Columbia Gas Transmission, LLC on March 16 began planned maintenance on its pipeline in Green County, Pennsylvania. The maintenance will reduce capacity at an interconnect between Columbia and Texas Eastern Transmission near Waynesburg, Pennsylvania. According to BENTEK Energy, flows for March 18 are 80 million cubic feet (MMcf), down 60 MMcf from the 30-day average of 140 MMcf. Maintenance is scheduled to run through April 14, but minimal impact is expected because of below-normal demand in the Northeast, BENTEK said.

Source: U.S. Energy Information Administration

India's Third LNG Terminal Commissioning Delay

2010-03-19T08:27:00.000-07:00

India's third terminal to import LNG will miss by a year the target to commission its first phase in March because of delays in starting dredging to desilt the ship channel, a senior executive at its owner said.

Due to delays in getting government clearances and a shortage of equipment, the dredging contractor, Gammon India Ltd., had to postpone its work, the executive at Ratnagiri Gas & Power Pvt. Ltd. told Dow Jones Newswires, asking not to be identified.

The terminal to handle 5.0 million metric tons of LNG a year was initially planned by Enron Corp. to import LNG for a power plant it was setting up in the western state of Maharashtra. It was also planning to lease out excess capacity. After the U.S. company's collapse, Ratnagiri Gas & Power took over the projects in 2005.

The delay in opening the terminal isn't expected to have any major impact on gas supplies as the local market is well fed with Reliance Industries Ltd. increasing output at its gas field in the Krishna-Godavari basin off the east coast. Ratnagiri Gas & Power also gets gas from Reliance to run its 2,150-megawatt power plant.

Also, Petronet LNG Ltd., India's largest LNG importer, has raised capacity at its Dahej terminal in the west coast to 11.5 MMTPA from 6.5 MMTPA.

QGC, BOC sign deal to produce LNG from coal seam gas

2010-03-18T00:41:00.000-07:00

This is a joint venture between the Queensland Gas Company and gas company BOC. This plant will provide LNG to create fuel for trucks.

Premier Anna Bligh said it could be the start of a new industry, leading to heavy transport switching from diesel to LNG.

"LNG produces up to 25 per cent fewer emissions than diesel and is a proven safe alternative to other fossil fuels,'' she said.

"Through this agreement, Queensland will join the rest of Australia, as BOC develops a network of fuelling stations across the country for vehicles converted to run on LNG.''
Ms Bligh said QCG has agreed to supply gas to BOC from July 2011 and if the companies meet that deadline, Queensland will become the first in Australia to produce LNG from coal seam gas.

The plant will be built next to the Condamine Power Station, west of Chinchilla, with construction expected to start early next year.

CNOOC to build new LNG terminal

2010-03-11T18:46:00.000-08:00

CNOOC Ltd is in talks with the relevant government authorities regarding the construction of a new liquefied natural gas terminal, Song Enlai, a senior executive at CNOOC said. CNOOC operates three LNG terminals, one in Guangdong Province, one in Fujian Province and one in Shanghai. Its fourth terminal, located in Zhejiang Province, is still under construction.

(Source: China Knowledge Online)

Adriatic LNG terminal will be operational in 2014

2010-03-11T06:27:00.000-08:00

Croatia's energy firms power board HEP, gas pipeline operator Plinacro and INA will change their participation structure in an Adriatic liquefied natural gas (LNG) terminal project to help make it operational in 2014.

Location: Northern Adriatic island of Krk

Capacity: 15 BCM

Target Market: Central and southeastern Europe and Italy

Investment Expected: 800 million euros

The government is expected to adopt a decision on establishing the Croatian LNG consortium soon.

At the moment, four foreign energy firms keen to take part in the project are part of the Adria LNG consortium. They include Germany's E.ON-Ruhrgas, Austria's OMV, France's Total and Geoplin from Slovenia.

Croatian firms should join later this year and have a 25-percent stake in the joint venture. INA can have 14 percent while Plinacro and HEP will jointly have 11 percent.

The LNG project has moved slowly in recent years, largely due to a slow decision-making process within Croatia, but the foreign investors are keen to speed it up because of a strong competition looming on the Italian side of the Adriatic.

Approval for Mid-Atlantic LNG Import Deal

2010-02-19T00:08:00.001-08:00

A U.S. subsidiary of Moscow-based OAO Gazprom, the world’s largest gas producer, won federal approval today to import liquefied natural gas into the U.S. Mid-Atlantic region.

The Federal Energy Regulatory Commission voted in favor of a deal between Gazprom Marketing & Trading USA Inc. and a U.S. affiliate of Oslo-based Statoil ASA to import the gas through Dominion Resources Inc.’s LNG terminal in Cove Point, Maryland. As much as 200 million cubic feet of gas a day would be imported under the Dec. 1 deal.

Surat LNG pipeline

2010-02-19T00:02:00.000-08:00

The State Government has approved the first licence for a gas pipeline from the Surat Basin to Gladstone in central Queensland.

Arrow Energy is planning to build an LNG facility on Curtis Island near Gladstone and hopes to start exporting in 2012.

The Government has approved a 470 km pipeline from Dalby which will cost about $550 million.

Arrow Energy spokesman Gareth Quinn says the company is also planning to build a pipeline from Moranbah to Gladstone.