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Gunvor leads short-term LNG ship charters, overall deliveries
PIPELINES & TRANSPORT
TRADING house Gunvor Group is leading short-term ship charters for LNG, and is antic- ipated to exceed delivery volumes reached in 2018. Overall – not just short-term – shipments are reported to have already surpassed the 2018 total of 176.
According to research by Fearnleys, which looked at xtures under three years in length, Gunvor has conducted at least 35 charters to ship LNG so far this year. is puts it ahead of both trading houses and major LNG players such as Cheniere Energy, Qatargas and Royal Dutch Shell.
Indeed, a Gunvor spokesman, Seth Pietras, told Bloomberg last week that the company had actually exceeded this number, but he did not provide further details.
In 2018, Gunvor boosted its LNG deliveries by 60% to about 11mn tonnes, putting it ahead of traders Vitol and Tra gura.
“We’re on track to signi cantly increase that volume this year,” Pietras said. He added that Gunvor had concluded 25 spot to multi-voyage xtures in 2018, and currently had 12 vessels that keep natural gas cooled to about minus 160 Celsius.
According to the Fearnleys report, most of the Gunvor short-term charters so far this year have been spot shipments. is comes as spot deals – of less than 90 days – and short-term transac- tions are accounting for a growing share of the LNG trade. Most LNG is still traded under long- term contracts, but buyers are seeking shorter, less rigid deals, spurred in part by the increased
availability of exible supply from the US.
In response to the surge of LNG supply, the biggest energy trading houses have been rap- idly growing their LNG operations in recent years. Moves being made as part of this include chartering vessels, investing in regasification infrastructure and signing long-term supply contracts with end-users that can last for 10 years
or more.
However, traders have been hit by low LNG
prices, under pressure from booming supply and sluggish demand growth. A narrowing price dif- ferential between the Paci c and Atlantic regions has also presented a challenge, as traders tend to use the di erentials to make money.
Pietras noted that over 60% of Gunvor’s LNG volumes delivered in 2018 were under medium- to long-term contracts. He added that the share of longer-term deals would increase as the trad- ing house expands the number of LNG vessels it has under long-term charter.
Gunvor’s growth can be attributed to its “abil- ity to structure cargo opportunities where others cannot”, a GasLog spokesman told Bloomberg. e shipowner has signed two vessel charters with Gunvor.
is week, Gunvor reported a gross pro t of $800mn for the rst three quarters of 2019, thanks in part to the rm’s overhaul that it started last year. is follows a loss of $330mn in 2018. e pro t achieved this year so far has allowed Gunvor to cancel plans to sell its Ingolstadt re n- ery in Germany and stall the sale of a stake in a Russian products terminal.™
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w w w . N E W S B A S E . c o m Week 40 10•October•2019