Page 7 - AsianOil Week 18
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SOUTHEAST ASIA AsianOil
In addition to the hit on the company’s oil sales, KrisEnergy warned that the price of condensate produced from the Bangora field in Bangladesh’s Block 9 would suffer from current market volatility. It said the condensate’s price was based on the aver- age monthly benchmark price quotation for Indonesian Attaka crude on a free-on-board (FOB) basis.
The Bangora gas price is set at 75% of the average for each calendar month of Platts’ quotations for high sulphur fuel oil 180 CST FOB Singapore, with a floor price of $70 per tonne and a ceiling price of $120 per tonne. KrisEnergy added that the condensate was subject to a further 1% discount when sold to state-owned Petrobangla.
The independent said that while Bangora’s gas price had remained unchanged at $2.32 per 1,000 cubic feet since it began operating the field in 2013 market volatility was likely to disrupt this.
Market volatility is the last thing KrisEnergy needs as it strives to complete a financial restruc- turing. The company has agreed to sell its entire 100% working interest in Block 115/09 offshore Vietnam as well as its 30% stake in Indonesia’s Andaman II deepwater production-sharing con- tract (PSC).
The company said this week that it was con- tinuing to work with its advisors and stakehold- ers to implement its financial restructuring. The company also hopes to advance the development of the Apsara oilfield Cambodia’s part of the Gulf of Thailand.
EAST ASIA
Russian Urals oil exports to China hit record in Q1
PERFORMANCE
CHINA received a record volume of Russian Urals oil in the first quarter, Argus reported on April 30, acquiring over 4mn tonnes (322,000 barrels per day) of the grade.
Urals is mainly sold in Europe, while most of the Russian oil bought by China is ESPO grade, produced in Eastern Siberia and shipped to the country via pipeline and ports in the Far East. Urals, on the other hand, can only be sent to China via tanker, at a considerably higher trans- port cost.
Urals shipments to China in the final quarter of 2019 totalled just 2.5mn tonnes, according to Argus. The previous record for shipments was set in the third quarter of 2018, when supplies reached 2.7mn tonnes.
Around three-quarters of the Urals bought by China from January to March arrived at the country’s northern ports of Qingdao, Jinzhou and Tianjin, according to Argus. The country’s north was less affected by coronavirus (COVID- 19) lockdowns earlier this year, and it is also
home to many small-sized independent refiner- ies, dubbed teapots.
Most of these teapots buy their oil on the spot market, rather than under long-term contracts. This makes them more likely to make sudden shifts in their buying habits, such as expanding purchases of Urals grade.
Urals imports to China totalled 2.3mn tonnes in January but fell to 520,000 tonnes in February, when the epidemic was at its height in the country. Demand for the grade recov- ered to 1.2mn tonnes in March and more than 2.1mn tonnes in April. This meant that almost a quarter of all Urals exports via tanker went to China.
Urals deliveries picked up in late March and April as a result of COVID-19 lockdowns com- ing into force throughout Europe, the main mar- ket in which it is sold. The slump in European demand led to Urals trading at a record discount to ESPO, increasing the grade’s attractiveness to Asia-Pacific buyers.
Week 18 07•May•2020 w w w . N E W S B A S E . c o m P7
