Page 8 - DMEA Week 22

DMEA NRG DMEA

by 2021. Mele Kyari, NNPC’s group managing Australian Energy Minister Angus Taylor
director, noted that costs were running as high said last week that it was essential for the country
as $35.97 per barrel at some fields. to lean on gas-fired power generation as it transi-
tions to a greener economy.
If you’d like to read more about the key events shaping Taylor’s comments came following an update
Africa’s oil and gas sector then please click here for to the Australian Energy Statistics, which showed
NewsBase’s AfrOil Monitor . that renewable energy sources accounted for
21% of the country’s power generation in 2019.
Spot prices spiral in Asia Gas-fired power generation represented 20.5%
The global oversupply of LNG and the destruc- of the national total.
tion of Asian demand amid the coronavirus Taylor said: “Gas is flexible and provides the
(COVID-19) pandemic have sent spot prices dispatchable capacity we increasingly need to
spiralling for a second week. balance intermittent renewables and deliver
Spot cargoes for July delivery into to East a secure, reliable and affordable electricity
Asia fell to $1.85 per mmBtu ($52.39 per 1,000 system to power our homes, businesses and
cubic metres), Reuters reported on June 1. The industries.”
newswire pointed to the number of cargoes on He added: “This has never been more impor-
the market this week, coupled with depressed tant – particularly as we begin our recovery from
industrial demand for gas around the world, as the impact of the COVID-19 pandemic. This is
behind the $0.07 per mmBtu ($1.98 per 1,000 why the Australian government believes a gas-
cubic metre) decline. fired recovery will drive jobs and economic
Malaysia’s state-owned Petronas has it is growth.”
“optimising” its production of LNG in response
to weaker prices and demand. If you’d like to read more about the key events shaping
The company told Reuters this week that Asia’s oil and gas sector then please click here for
challenges relating to the ongoing COVID- NewsBase’s AsianOil Monitor .
19 pandemic meant that it needed to optimise
production volume in line with the market European gas demand still weak
slowdown. European gas demand remains subdued, despite
Malaysia’s exports of LNG are expected to the slow easing of COVID-19 lockdowns. Rus-
drop to 1.5-1.64mn tonnes in May, the newswire sian gas flows via the Yamal-Europe pipeline that
quoted unnamed industry sources as saying last runs through Belarus and Poland to Germany
week. This would represent a nearly two-year slumped to zero last week, with the continent’s
low in terms monthly export volumes, down gas storage levels at an unprecedented high for
from the 1.92mn tonnes the country exported this time of year.
in April. Russia’s Gazprom, by far Europe’s biggest gas
The news comes after Petronas announced supplier, has also cut shipments via other routes
last month that it would cut its 2020 capital including Ukraine. But its ship-or-pay transit
expenditure budget by 21% and its operating with Kyiv means it will pay to pump 65bn cubic
expenditure 12%. metres (bcm) of gas through Ukraine’s pipelines
With the international gas market tanking, regardless of whether it actually sends that much.
the region’s largest gas exporter – Australia – has Norwegian gas supplies to Europe were below
begun turning its attention to ways it can prop up the five-year average last month but are now at
domestic producers. normal seasonal levels.

P8 www. NEWSBASE .com Week 22 04•June•2020