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TEPCO struggles with power cuts
JAPAN
TEPCO customers in Japan’s Chiba Prefec- ture could face two weeks of power cuts after Typhoon Faxai caused unprecedented damage to the region.
TEPCO Power Grid, a subsidiary of TEPCO, said the forecast was caused by unprecedented damage in parts of Chiba. The statement fol- lowed TEPCO’s initial response that it could restore within a matter of days.
Just after the Typhoon hit the city of Chiba last week, 935,000 households were without power. This fell to 185,000 by September 13, TEPCO officials said.
The areas most affected by Typhoon Faxai, which made landfall early on September 9, are the cities of Kamogawa, Minamiboso, Tateyama, and the town of Kyonan in south Chiba.
The biggest problem for residents in the lack of air conditioning during high late summer temperatures
Japanese Industry and Trade (METI) Minis- ter Isshu Sugawara said last week that the black- outs could last one week or longer.
The typhoon made landfall near the city of Chiba on September 9 was reportedly one of the strongest to hit the Kanto region.
The typhoon highlights some weakness in Japanese power infrastructure. Most power lines are above ground, and some experts have sug- gested burying power lines to protest vulnerable regions during future typhoons. However, this is rare because of the high cost.
TEPCO Power Grid President Yoshinori Kaneko, apologised for the inconvenience caused by the blackout. He said they will con- tinue to put every effort into restoring power as soon as possible.
However, local people have criticised TEP- CO’s response, as many people living in remote parts of mountainous areas are now left facing week without power.
Japan and especially TEPCO have been espe- cially sensitive to disaster issues since the Fukus- hima nuclear disaster in 2011. The nuclear power plant (NPP) was owned and run by TEPCO, which is still facing the political and financial of the disaster.
TEPCO is now considering mothballing more nuclear reactors, and this week a Japa- nese court will deliver its verdict on whether three TEPCO executives are liable for the 2011 disaster.™
GAS-FIRED GENERATION
Gunvor bids low in Pakistani LNG tender
PAKISTAN
GUNVOR has reportedly emerged as the low- est bidder for most of the cargoes in Pakistan’s recent spot liquefied natural gas (LNG) supply tender.
The commodity trader has submitted the lowest bids for six of the 10 cargoes to be deliv- ered between October and December, Reuters has said citing a document from state-run Paki- stan LNG. The state company declares lowest bidders rather than tender winners.
DXT Commodities, Vitol, PetroChina and Socar Trading are understood to be the lowest bidders for the other cargoes. The companies will deliver four cargoes in October, two in Novem- ber and the rest in December.
The prices in the tender ranged from 8.3% to 10.9% of Brent crude oil prices, which Reu- ters calculated would equate to $4.98-6.54 per mmBtu ($137.75-180.9 per 1,000 cubic metres).
Spot prices have waned in recent years as producers in Australia and the US have com- missioned new plants. This in turn has placed some pressure on long-term LNG supply con- tracts, with Montel reporting on September 9 that Korea Gas (KOGAS) had received bids in a recent tender equivalent to $7 mmBtu ($193.62 per 1,000 cubic metres) at current oil prices. This compared with contracts reportedly signed for
around $11 mmBtu ($304.26 per 1,000 cubic metres).
“What the spot is doing is, it’s influencing the contract market – contracts today are 30% below where they were during the boom years,” Credit Suisse’s head of oil and gas research in Australia, Saul Kavonic, said.
In 2018, Pakistan received 6.86mn tonnes of LNG, up from 4.62mn tonnes in 2017. Given the country’s gas needs, if more capacity can be secured, there is scope for imports to rise sub- stantially. Wood Mackenzie has forecast LNG demand will expand to 11mn tonnes in 2025 and 17.5mn tonnes in 2035, making “Pakistan the 8th largest global market. There is also upside to our forecast.”
Pakistan has two FSRUs moored at Port Qasim. There has been discussion of a third FSRU in the country, potentially starting up in 2020. The Economic Co-ordination Committee (ECC) approved the plan in early July, in rec- ognition of the country’s gas shortages. Talks between companies and the government have only made slow progress, however, amid con- cerns of competition. ExxonMobil had been interested in backing an FSRU plan in the coun- try but dropped out, marking a major setback for expanding Pakistan’s import capacity.™
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