Page 15 - GLNG Week 33

GLNG AFRICA GLNG

Algerian Energy Minister revises

timeline for drop in gas exports

PERFORMANCE ALGERIA’S Energy Minister Abdelmajid Attar figure of 64 bcm.
has said that the country’s natural gas exports are The North African state has said it expects
not likely to decline significantly before the end this trend to continue in the long term. This is
of the decade. partly because rising domestic consumption lev-
Attar, the former CEO of the national oil els will reduce the volumes available for export
company (NOC) Sonatrach, told reporters at the and partly because the country is not replacing
beginning of last week that export volumes were its reserves quickly enough to compensate for
set to fall in the near future. Algeria is on track to production.
sell 45bn cubic metres of gas to foreign buyers in Declining exports would probably pose a
2020, he said, but annual exports will sink to 26 problem for Algeria’s government, which derives
bcm in 2025 and remain in the 25-30 bcm per fully 95% of its foreign-currency revenues from
year range in the second half of the decade. crude oil and natural gas sales. They might also
Volumes could then fall further to 20-30 bcm affect Sonatrach’s ability to meet all of its com-
per year after 2030, he added. mitments to foreign customers – including buy-
Later in the week, though, he backtracked, ers of pipeline gas in Italy, Spain and Portugal,
saying that he did not believe exports would drop as well as buyers of LNG in Spain, France, Italy,
into the 25-30 bcm per year range so quickly. Greece and Turkey.
This shift is not likely to occur until 2030 or later, The NOC is pinning its hopes for the future on
he stated. unconventional gas projects. Algeria is believed
Algeria exported around 40.9 bcm of gas in to possess some 20 trillion cubic metres of this
2019, including both pipeline and LNG ship- hydrocarbon source, and commercial discov-
ments. This marked a 36.1% drop on the 2005 eries would help boost the country’s reserves.™

AMERICAS

Petronet reportedly considering

scaling back Tellurian investment

INVESTMENT INDIA’S Petronet LNG is reportedly considering in an 18% equity stake in the project. The MoU
scaling back a proposed investment in US-based expired in June, with the two companies failing
Tellurian’s Driftwood LNG project, which had to finalise a definitive agreement in the wake of
previously been pegged at around $2.5bn. This a major market downturn caused in part by the
comes after Tellurian redesigned the first phase coronavirus (COVID-19) pandemic. However,
of its Driftwood plan, reducing its cost by around talks between the two companies were subse-
30% from $28bn by deferring three planned gas quently renewed in July.
pipelines to serve the terminal, among other On August 18, comments from Petronet’s
steps. (See GLNG Week 32) managing director and CEO, Prabhat Singh,
On August 16, India’s Economic Times cited reported by the Hindu Business Line, appeared
sources familiar with the matter as saying the to back up the reports in the Economic Times.
reduced scope of Driftwood’s first phase had “We are exploring the market. But one thing
prompted Petronet to re-evaluate its investment is sure: that investments as such are not look-
plan. The company will reportedly make a deci- ing lucrative at this point of time,” Singh was
sion on this soon, ahead of a December deadline quoted as telling journalists. He went on to note
for finalising an agreement with Tellurian. that spot LNG prices had fallen close to $3 per
It has not been smooth sailing for Petronet million British thermal units ($82.98 per 1,000
and Tellurian since they first signed a memo- cubic metres), while under long-term contracts
randum of understanding (MoU) in Septem- prices remain at around $4.50-5.50 per mmBtu
ber 2019. The initial terms of the MoU called ($124.47-152.13 per 1,000 cubic metres). This
for Petronet to negotiate the purchase of up to makes it more challenging for sellers to negoti-
5mn tonnes per year (tpy) of LNG from the ate offtake deals with buyers that have a range of
Driftwood terminal, as well as investing $2.5bn sources to choose from.™

Week 33 21•August•2020 www. NEWSBASE .com P15