Page 9 - GLNG Week 36

GLNG ASIA GLNG
Gunvor bids low in Pakistani LNG tender
INVESTMENT
GUNVOR has reportedly emerged as the lowest bidder for most of the cargoes in Pakistan’s recent spot lique ed natural gas (LNG) supply tender.
The commodity trader has submitted the lowest bids for six of the 10 cargoes to be deliv- ered between October and December, Reuters has said citing a document from state-run Paki- stan LNG. e state company declares lowest bidders rather than tender winners.
DXT Commodities, Vitol, PetroChina and Socar Trading are understood to be the lowest bidders for the other cargoes. e companies will deliver four cargoes in October, two in Novem- ber and the rest in December.
e prices in the tender ranged from 8.3% to 10.9% of Brent crude oil prices, which Reu- ters calculated would equate to $4.98-6.54 per mmBtu ($137.75-180.9 per 1,000 cubic metres) at current international oil prices.
Spot prices have waned in recent years as producers in Australia and the US have commis- sioned new plants. is in turn has placed some pressure on long-term LNG supply contracts, with Montel reporting on September 9 that Korea Gas (KOGAS) had received bids in a recent ten- der equivalent to $7 mmBtu ($193.62 per 1,000 cubic metres) at current oil prices. is compared with contracts reportedly signed for around $11
mmBtu ($304.26 per 1,000 cubic metres). “What the spot is doing is, it’s in uencing the contract market – contracts today are 30% below where they were during the boom years,” Credit Suisse’s head of oil and gas research in Australia,
Saul Kavonic, said.
In 2018, Pakistan received 6.86mn tonnes of
LNG, up from 4.62mn tonnes in 2017. Given the country’s gas needs, if more capacity can be secured, there is scope for imports to rise sub- stantially. Wood Mackenzie has forecast LNG demand will expand to 11mn tonnes in 2025 and 17.5mn tonnes in 2035, making “Pakistan the 8th largest global market. ere is also upside to our forecast.”
Pakistan has two FSRUs moored at Port Qasim. There has been discussion of a third FSRU in the country, potentially starting up in 2020. e Economic Co-ordination Committee (ECC) approved the plan in early July, in rec- ognition of the country’s gas shortages. Talks between companies and the government have only made slow progress, however, amid con- cerns of competition.
ExxonMobil had been interested in backing an FSRU plan in the country but dropped out, marking a major setback for expanding Paki- stan’s import capacity.™
AUSTRALASIA
Western Gas seeking partner for Equus FLNG
PROJECTS & COMPANIES
WESTERN Gas has appointed Goldman Sachs to help it nd a partner for the Equus LNG pro- ject o shore Western Australia. e privately owned company is planning to develop the eld using a oating LNG (FLNG) facility that would have the capacity to process 2mn tonnes per year (tpy). is marks a shi away from plans under the eld’s previous owner, Hess, to develop the eld to feed into larger, existing facilities. West- ern Gas took over the eld in 2017 and is target- ing a start-up date of 2024 for the $3.5bn project.
“Equus is at the right stage of development where the introduction of an experienced and nancially capable partner can help progress the project to rst gas and realise the value of the greater Equus area,” Western Gas’ executive director, Andrew Leibovitch, said in a September 10 statement.
e project will involve a oating produc- tion, storage and offloading (FPSO) facility, with a 160-km pipeline connected to the FLNG facility. e project was designed by McDermott International and Baker Hughes, with Western Gas describing it as “a globally competitive, mid- scale LNG development plan”.
A nal investment decision (FID) would be required in 2020 if Western Gas is to start up Equus on time in 2024.
A Western Gas spokesman, Tony Johnson, was reported by Reuters as saying the company had spoken to parties about potentially taking a stake in Equus, though he declined to name them. However, it has been suggested that pri- vately owned Transborders Energy could be interested in participating. The company has said it is seeking to develop small-scale FLNG projects with gas reserves of up to 2tn cubic feet (57bn cubic metres), which is about the size of Equus.
Indeed, Transborders’ managing director, Daein Cha, told Reuters that Equus would be a good t for its FLNG technology. He added, however, that Western Gas already had a development concept and contractors lined up, and that Transborders did not plan to buy stakes in gas elds on the o -chance of using its technology.
“If they are in need of an alternative solution to further create value, we’re quite open to have that discussion,” he said.™
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