Page 13 - FSUOGM Week 32

FSUOGM NRG FSUOGM

The ministry is unlikely to get everything it be replaced altogether.
is asking for, given the pilot scheme’s popularity Western Australia’s Department of Mines,
among Russia’s powerful oil lobby. On the other Industry Regulation and Safety said the inspec-
hand, some tweaks will have to be made given tion orders for Trains 1 and 3 had to be carried
the huge budgetary shortfall that the country is out before August 21. It is not yet clear whether
facing. The Kremlin will likely have to wade into Chevron may have to shut down the trains in
the dispute and thrash out a compromise. order to carry out the inspection – and effect any
In other news, Lukoil has reported a sharp necessary repairs – but the order raises the pros-
decline in oil and gas production in the first half pect that the whole plant could be shut down.
of the year. This is not only due to OPEC+ cuts This comes as the LNG market continues to
that came into force in April, but also a steep struggle to absorb a global oversupply, which has
drop in its Uzbek gas sales to China. been exacerbated by the hit to demand from the
Chinese gas demand has continued to grow coronavirus (COVID-19) pandemic. Indeed,
this year, in spite of COVID-19 lockdown other LNG producers may welcome an outage at
measures, but at a much slower pace. Chinese Gorgon. And elsewhere in the world, the current
companies have prioritised purchases while market oversupply is not stopping LNG opera-
cutting imports, including from Uzbekistan, tors from moving forward with liquefaction
where Lukoil operates the Southwest Gissar and capacity expansions that were already underway
Kandym projects. before the pandemic hit.
Turkmen state media have reported progress Among those companies reporting progress
at several refining projects being undertaken by recently are Cheniere Energy, which is now
the country’s favoured contractor, US-registered anticipating bringing Train 6 at its Sabine Pass
Westport Trading Europe. But Turkmenistan’s LNG terminal on the US Gulf Coast into service
strict control over information flow makes it dif- earlier than previously announced, in the second
ficult to determine just how much work is taking half of 2022. Meanwhile, Kinder Morgan said it
place on the ground. After all, despite numerous would be ready to bring the ninth of 10 small-
reports of progress over the years, the country’s scale liquefaction trains at its Elba Island LNG
throughput capacity does not appear to have terminal in Georgia online this week. And Train
changed in five years. 3 at Cameron LNG, also in the US, started com-
mercial service this week.
If you’d like to read more about the key events shaping
the former Soviet Union’s oil and gas sector then please If you’d like to read more about the key events shaping
click here for NewsBase’s FSU Monitor . the global LNG sector then please click here for
NewsBase’s GLNG Monitor .
More grief for Gorgon LNG
Chevron and its partners in the Gorgon LNG Latin America: Argentina bond swap offer
project have been ordered by the government In Argentina, Compañía General de Combusti-
of Western Australia to inspect the propane heat bles (CGC) has joined YPF, the national oil com-
exchangers at Trains 1 and 3 at the 15.6mn tonne pany (NOC), in the ranks of companies offering
per year (tpy) liquefaction terminal. This comes a bond swap.
as Train 2 at Gorgon remains offline for repairs Last week, the independent oil and gas
after an inspection of that train’s propane heat firm revealed that it was looking to tender an
exchangers during planned maintenance found exchange of $300mn worth of senior unsecured
weld quality issues and cracks in the equipment. bonds due to mature in 2021 for securities that
The US-based super-major previously said will be repaid in 2025. The move led Fitch Rat-
Train 2 would be returned to service in Septem- ings to downgrade CGC; the agency explained
ber. But the Australian Manufacturing Workers its decision by saying that the company appeared
Union has voiced fears that the cracks may not be to be taking this step in the hope of avoiding a
reparable and may require the heat exchangers to default on its 2021 notes.

Week 32 12•August•2020 www. NEWSBASE .com P13