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producers have been critical in rebalancing IEA’s executive director, Fatih Birol, said in a
global supply with demand since the coronavi- statement.
rus pandemic struck. They had hoped to taper In the World Energy Outlook, meanwhile,
the cuts by 2mn bpd at the start of 2021, but a the agency noted that a record year of approvals
looming surplus could threaten these plans. for new liquefaction projects in 2019 had now
Meanwhile, BP has confirmed that the been followed by a year with no new projects
Trans-Adriatic Pipeline (TAP) is still on track to green-lit – and none likely by the end of 2020.
deliver the first gas from Azerbaijan to Europe by Further challenges lie ahead for the LNG
the end of this year, as the UK oil major looks to industry, the IEA warned, with one-third of
quell concerns of a delay amid continued fight- active contracts due to expire over the next five
ing in the Nagorno-Karabakh region. years. Over the same period, global liquefaction
In a statement on October 13, BP said the capacity is projected to increase by 20% from
commissioning of TAP and an interconnecting projects that are currently under development,
pipeline would be completed in November. This according to the agency.
“will allow the Shah Deniz consortium to finalise “These two factors will strongly impact the
the final steps required to start the 25-year-long structure of LNG supply, and create new oppor-
supplies of natural gas from Azerbaijan to cus- tunities for buyers and challenges for marketers
tomers in Italy, Greece and Bulgaria as planned in a context of demand uncertainty,” the IEA
by the end of 2020.” said.

If you’d like to read more about the key events shaping Latin America: Gas and refineries
the former Soviet Union’s oil and gas sector then please Argentina’s natural gas production may have
click here for NewsBase’s FSU Monitor . fallen in both July and August, but the adminis-
tration of President Alberto Fernandez unveiled
GLNG: IEA highlights LNG’s role a new plan to stimulate the gas sector last week.
The International Energy Agency (IEA) last At a ceremony marking the launch of the plan,
week highlighted the role of LNG in adjusting to Fernandez stated that the national oil company
a drop in global gas demand in the wake of the (NOC) YPF was slated to invest some $1.8bn in
coronavirus (COVID-19) pandemic. The agency gas production over the next three years.
published its World Energy Outlook 2020 and Speaking at the same event, Energy Minister
its Global Gas Security Review last week, with Dario Martinez said that Buenos Aires was set-
LNG featuring significantly in both. (See: IEA ting up a four-year tender scheme that would
highlights LNG’s role in gas market, pag 9) allow producers to offer gas to the market at
The IEA noted that LNG remains central prices of up to $3.7 per million Btu. This scheme
to ensuring the security of global gas supplies, is designed to secure more than 70mn cubic
adding that the super-chilled fuel played a major metres per day of gas for Argentina’s domestic
role in the market’s adjustment after COVID-19 market, while ensuring that domestic producers
made gas demand crash. Monthly global exports are paid an adequate price, he commented.
of LNG fell by 17% between January and July In related news, the Argentinian unit of the Bra-
2020, the agency said, discussing the role the zilian oil company Raizen has announced plans
industry is playing in balancing gas markets. to invest $715mn over the next three years to
LNG contracting activity collapsed from a high modernise and expand its Dock Sud refinery
of 95bn cubic metres in 2018 to about 35 bcm in in Avellanada. The project will boost the plant’s
the first nine months of 2020. throughput capacity from the current level of
“Since the IEA started tracking flexibility in 110,000 barrels per day (bpd) and create thou-
LNG markets in the first edition of the Global sands of new jobs, the company says.
Gas Security Review five years ago, we have seen Also in the downstream sector, Petroperu has
a notable improvement across a range of LNG launched bidding for service contracts as part
market flexibility metrics. This is improving of the long-delayed modernisation of the Talara
security of supply and was critical in enabling refinery. The state-owned company is looking to
the market to adjust to the historic demand award 10-year operational management service
shock witnessed in the first half of 2020,” the contracts for work on the plant’s auxiliary units.

Week 42 23•October•2020 www. NEWSBASE .com P7