Page 8 - AsianOil Week 34 2022

AsianOil SOUTH ASIA AsianOil

Venezuelan petcoke sales to India on rise

PERFORMANCE INDIAN cement manufacturers have been used to generate power, thereby enabling Indian
importing significantly more Venezuelan petro- companies to avoid surging coal prices. It is
Indian cement leum coke in recent months, as they seek to avoid more costly per tonne than coal, but it produces
companies imported US sanctions penalties for sourcing fuel from more energy when burnt and is often utilised by
160,000 tonnes of Russia. cement companies.
petcoke from Venezuela Citing trade sources, Refinitiv ship tracking According to Ramco Cements’ CFO S. Vaith-
between April and July. data and Venezuelan shipping schedules, Reuters iyanathan, the Venezuelan fuel has been a worth-
said last week that Indian cement companies had while investment. “The quality of petcoke is very
imported 160,000 tonnes of petcoke from Ven- good, and it has very low sulphur,” he told the
ezuela between April and July. It also reported news agency last week.
that another 50,000 tonnes of the material was So far, Vaithiyanathan said, the company
expected to arrive at the port of Mangalore on has purchased two 50,000-tonne cargoes that
India’s southwest coast in the coming days, with were delivered in June and July at a discount of
an additional shipment of 30,000 tonnes due to $15-$20 per tonne. The only drawback to these
be transported later in August. arrangements was the 50-day wait for the ship-
Traditionally, the US and Saudi Arabia have ment to arrive, he said.
been India’s main petcoke suppliers. However, Since 2019, Venezuela’s oil sector has been
the surge in coal prices that has followed the under sanctions from the US government.
Russian invasion of Ukraine has led a number of These restrictions have cut off many market
Indian cement makers – including JSW Cement, opportunities, but Venezuelan petroleum
Ramco Cements Ltd and Orient Cement Ltd – to product exports have climbed since the Rus-
turn to other sources. They have settled on Ven- sian invasion of Ukraine, due partly to its pet-
ezuela because that country is offering competi- coke prices.
tive prices, Reuters said. According to Indian cement companies, Ven-
A byproduct from oil upgrading, petcoke is a ezuelan petcoke is typically offered at prices that
highly affordable alternative to coal that can be are at a 5-10% discount below US prices. ™

EAST ASIA

China resells LNG to Europe

PIPELINES & CHINA is selling its surplus LNG cargoes to equal to 7% of Europe’s gas imports in the first
TRANSPORT Europe, providing the latter with some relief sixth months of this year.
as European gas prices soar as a result of the COVID-19 restrictions as well as the fall-out
Following a slump in summer heatwaves and cutbacks in Russian gas from weaker economic growth meant that Chi-
its own LNG needs, supply. na’s real gross domestic product (GDP) growth
China is reselling to European LNG imports soared 60% year on in the first half of the year amounted to a mere
the European market year in the first six months of this year, accord- 2.5%. Meanwhile, the central government has
in desperate need of ing to Kpler, amounting to 53mn tonnes. At the also taken steps to bolster energy production
alternatives to Russian same time, Chinese imports dropped 20.3% y/y amid the energy crisis, and involves bringing
gas. in January to July, as demand has been crippled more coal-fired power plants back online at the
by coronavirus (COVID-19) pandemic restric- expense of LNG demand. According to Nikkei
tions. While those restrictions are starting to be Asia, Shanxi Province, for example, has boosted
eased, in the meantime China has the opportu- its coal output by 100mn tonnes to 1.3bn tonnes
nity to resell LNG it does not need to Europe. this year and plans to add a further 50mn tonnes
According to Nikkei Asia, Chinese LNG of supply in 2023.
trader JOVO Group recently disclosed it had China has also stepped up its own gas supply,
resold an LNG cargo to a European buyer, with domestic production on track to rise by 7%
and a futures trader told the news site that y/y in 2022, according to gas consulting firm SIA
the profit from such a deal could amount Energy. The drop in China’s LNG needs has had
to tens of millions of dollars and possibly implications for international prices. LNG prices
even $100mn. Chinese energy giant Sinopec in Asia are currently at around $45 per mmBtu,
also acknowledged in April that it had been while European prices are exceeding $60 per
diverting excess LNG cargoes to the interna- mmBtu. In a typical year, LNG supplies to Asia
tional market. Local media reports estimate sell at a premium to European deliveries, but
that Sinopec alone has resold 45 cargoes of that long-running trend reversed late last year as
LNG, or around 3.15mn tonnes, and the total a result of Russian cuts to Europe’s gas supply and
amount of resold Chinese LNG was likely other factors. ™

P8 www. NEWSBASE .com Week 34 29•August•2022