Page 7 - AsianOil Week 10 2022

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Sri Lanka’s Supreme Court dismisses legal

challenge against LNG-to-power project

PROJECTS & SRI Lanka’s Supreme Court on March 4 dis- the coast of Colombo. Under the terms of the
COMPANIES missed a legal challenge against a proposed agreement, the company would have gas supply
LNG-to-power project that is being developed rights to the Kerawalapitya power complex and
by New Fortress Energy (NFE). The company would initially provide Sri Lanka with an esti-
subsequently reiterated its commitment to the mated 1.2mn (4.5mn litres) gallons per day of
project in a March 8 statement. LNG. This would be used to supply both the cur-
“Having considered the merits of all the fun- rently operational 310-MW Yugadanavi power
damental rights petitions filed seeking to halt plant and the 350-MW Sobadanavi power plant,
NFE’s development of natural gas power solu- which is due to enter service in 2023.
tions in Sri Lanka, the court fully dismissed the Sri Lanka’s government has long been calling
petitions without further hearing,” NFE said. for gas to make up at least one-third of the coun-
“We are pleased that the court has dismissed try’s energy mix by 2030, up from zero today.
these petitions, as NFE can now proceed with However, despite the government also trying to
our plans to deliver cleaner fuels and more relia- revive interest in developing untapped offshore
ble, affordable power to Sri Lanka,” stated NFE’s gas deposits, the only way of adding gas to Sri
chairman and CEO, Wes Edens. Lanka’s energy mix currently is via the import of
According to the statement, the company LNG. Various plans to import LNG have failed
struck a definitive agreement with the govern- to gain traction in recent years, with complex
ment of Sri Lanka in September 2021, paving bureaucracy and political volatility acting as
the way for NFE to build an LNG terminal off roadblocks to new projects.™

SOUTHEAST ASIA

Outage reported at Malaysia LNG Satu

PERFORMANCE AN unplanned outage was reported at the
Malaysia LNG (MLNG) Satu – part of the coun-
try’s nine-train Bintulu LNG complex – last
week.
The outage is reported to have resulted from
a leak that led to the second train being taken
offline. Argus Media cited some term offtakers
from the facility as saying the train went offline
on March 2 and would be returned to service on
March 14.
The train has a capacity of 2.8mn tonnes
per year (tpy) of LNG. Malaysia’s state-owned
Petronas has a 90% stake in MLNG Satu and
markets LNG volumes from the venture on MLNG Satu is part of
behalf of its partners – Mitsubishi and the analyst Kaushal Ramesh as saying the outage was Malaysia’s Bintulu LNG
Sarawak state government. MLNG Satu – or likely to take two cargoes off the market between complex.
One – consists of three trains. The Bintulu March and April and that this could potentially
complex also included the three-train MLNG trigger replacement demand.
Dua (Two), the two-train MLNG Tiga (Three) Petronas is also reported to be in the spot
and Train 9. market, potentially seeking replacement car-
Petronas is reported to have approached some goes for the ones lost to the outage. This comes as
Bintulu offtakers requesting that they either load Asian spot prices are rising, spurred by concerns
smaller volumes in March or delay the delivery over disruptions related to Russia’s invasion of
of their March cargoes. Argus reported that Pet- Ukraine and the international response to it.
ronas had also sought to exercise its right to can- Colder weather is also reported to have bolstered
cel at least one term buyer’s April delivery under spot demand among countries including Japan
a downward quantity tolerance (DQT) clause in and South Korea. But gas prices are currently
its contract. higher in Europe, which is more vulnerable to
Reuters cited Rystad Energy’s senior LNG disruptions of Russian supply.™

Week 10 11•March•2022 www. NEWSBASE .com P7