Page 17 - GLNG Week 46

GLNG ASIA GLNG

Sinopec’s gas production to slow this year

PERFORMANCE CHINA’S state-run Sinopec Corp. has revealed in the first nine months comes as all of the coun-
that it expects natural gas production growth to try’s upstream players come under mounting
slow significantly this year, despite the country’s pressure to step up deliveries during the winter
rising demand for the fuel. heating season, which started on November 15
Sinopec said on November 19 that its pro- and runs until March 15.
duction was slated to rise by just 1.1% this year Sinopec, for its part, pledged on November
to around 30bn cubic metres, after gaining 7.2% 16 to boost gas supplies this season by 5.3% year
in 2019 to 29.67 bcm. The state giant revealed on year to 20 bcm. The company added that it
that its output had actually dipped in the first would increase spot purchases of LNG, with its
nine months of the year, shrinking 0.2% to 21.87 terminals in Tianjin and Qingdao set to receive
bcm. 9 bcm this winter.
While the company failed to explain why its Sinopec issued its first tenders to buy LNG
production growth was slowing, it took the time on the Shanghai Petroleum and Natural Gas
to note that “natural gas has become a significant Exchange on October 30, the bourse’s launch
growth point of profit margins” owing to falling date for LNG trading. Sinopec is expected to
development costs. purchase several 65,000-tonne cargoes from the
As questions rise over the long-term future international market over the next few months,
of oil, China’s energy majors have begun switch- the official Xinhua news agency reported at the
ing their focus to gas projects, and Sinopec is no time.
exception. The company has already committed Sinopec unloaded the world’s largest LNG
to boosting gas output to 40 bcm per year by carrier, Al Mafyar, at its Tianjin terminal in
2023, when it will account for more than half of northern China earlier this month.
its total production. In comparison, 2019’s pro- The 345-metre-long vessel, which has a max-
duction of 29.67 bcm was equivalent to 41% of imum carrying capacity of 266,000 cubic metres
Sinopec’s total output. of LNG, delivered 207,000 cubic metres Qatari
Sinopec’s revelation of weaker gas production LNG on November 10.™

AUSTRAL ASIA

Papua LNG boosted by new PNG legislation

PROJECTS & THE Papua LNG project received a major boost
COMPANIES last week after the Papua New Guinea (PNG)
government passed six pieces of legislation that
will allow operator Total to proceed with the
$20bn development. The bills pertain specifically
to various aspects of Papua LNG, including tax
and insurance.
PNG Prime Minister James Marape said
Total would send a delegation to the country in
the coming weeks for talks on how the project
would proceed.
“The Total delegation will arrive in the next
two weeks and I and [Petroleum] Minister A two-part expansion
[Kerenga] Kua will sit in with them for them 2019, pledging to extract greater benefits from involving both the
to tell us the exact timeline of the Papua LNG,” natural resource projects. This has led to talks existing PNG LNG
Marape said. stalling between the government and ExxonMo- project and the
Talks are reportedly also planned with the bil over developing the P’nyang gas field, which proposed Papua LNG
other partners in Papua LNG, ExxonMobil and would feed a new liquefaction train at PNG was initially planned,
Oil Search. The companies had initially been LNG. However, the current government agreed but it is uncertain
aiming to double PNG’s LNG exports through to honour a deal signed by Total with a previous whether more than one
a two-part initiative involving the construction PNG government. of these will go ahead.
of Papua LNG and the expansion of the existing All of these issues had been playing out for
ExxonMobil-led PNG LNG plant. months prior to the coronavirus (COVID-19)
However, the plan ran into obstacles after the pandemic pushing the LNG market into a down-
current PNG government took power in May turn and depressing global demand for the fuel.

Week 46 20•November•2020 www. NEWSBASE .com P17