Page 17 - FSUOGM Week 41

FSUOGM PERFORMANCE FSUOGM

European gas prices recover to

level at end-2019

EUROPE EUROPEAN gas prices have seen a significant than the seasonal average but within historical
recovery, with spot contracts at the Dutch TTF bounds.”
Higher prices could also hub now selling at $186 per 1,000 cubic metres, Russia’s Gazprom naturally stands to gain
trigger a recovery in Kommersant reported on October 12. from higher prices over the coming months.
LNG imports, however. This marks the highest level since December But “the rebound in gas prices might lead to a
2019, just before prices plummeted after Russia recovery in LNG imports, which in turn would
and Ukraine agreed a new transit deal, averting likely keep gas prices from appreciating further,”
a potential supply disruption to Europe. Prices VTBC said.
slumped to an historic low of $34 per 1,000 cubic Gazprom has been hit harder by the slump
metres on May 21, as a result of coronavirus in European demand than most other suppli-
(COVID-19) lockdowns and a growing supply ers, with its pipeline sales to the continent con-
glut. tracting by 9% so far this year, the International
November gas futures are trading even higher Energy Agency (IEA) estimated in a webinar on
than the spot price, at $187 per 1,000 cubic October 12.
metres, according to Kommersant. The company expects the European market
“The growth in gas prices in Europe was to remain overstocked into next year, due to
made possible by flattish LNG supplies to the rebounding US LNG supplies, Gazprom Export
region, which have fallen a marginal 1% in Sep- CEO Elena Burmistrova said at the online Flame
tember-October to date versus August, but in conference. She blamed US LNG exporters for
general have been declining in recent months, unbalancing the market, saying that Gazprom
dropping 10% versus the summer,” VTB Capital had acted “responsibly and self-confidently” by
(VTBC) commented in a research note. “Natu- taking a hit to its sales rather than flooding the
ral gas storage is now 96% full, which is higher market. ™

Kazakhstan pushes on with

oil, gas output plans

KAZAKHSTAN KAZAKHSTAN is sticking with its long-term to increased oil output by 12mn tonnes from the
production plans for its largest oil and gas fields, current 29mn tonnes by 2025-2026.
Both Tengiz and despite lockdown-driven reductions in raw The Karachaganak field has been left
Kashagan plan to grow materials production and petroleum product untouched by the restrictions under OPEC+.
their output in the consumption this year, the press service of the Oil and gas condensate production at the field
coming years. Kazakh Ministry of Energy said in a written in January-August grew by 3% compared to the
response to questions from Reuters. same period last year.
The ministry did not provide a forecast Meanwhile, shareholders of the field’s opera-
for oil production in 2020 at the main Kazakh tor, Karachaganak Petroleum Operating (KPO),
fields – Kashagan, Tengiz and Karachaganak – continue negotiations with the government on
but specified that the operators of the first two the division of revenues from oil sales, the Min-
fields still planned to expand output in coming istry of Energy said. ™
years. Kazakhstan has cut production under the
OPEC+ global producers’ pact.
Earlier, the ministry said that the Kashagan
operator, the NCOC consortium, intends to
increase the production of raw materials by 2022
to 420,000 barrels per day and to 450,000 bpd by
2024. It also aims to launch a gas processing plant
at the field by 2022 with a capacity of 1bn cubic
metres per year.
Tengiz's operator, Tengizchevroil (TCO), is
overseeing a capacity expansion project expected

Week 41 14•October•2020 www. NEWSBASE .com P17