Page 5 - GLNG Week 06 2021
P. 5
GLNG COMMENTARY GLNG
PGNiG will be free of its obligations to Gaz- outbreak and sought to cancel some of its con-
prom. The company has long-term contracts to tracted cargoes.
buy US LNG, and once these come into force, its That year, much of the supply that would have
portfolio is predicted to expand to roughly 9.3 gone to Asia found a home in European stor-
bcm per year of gas. PGNiG said LNG deliver- age. This winter, however, European imports
ies from Qatar – which just sanctioned its giant declined by 55% y/y in January, according to
LNG expansion project – would also continue Tudor, Pickering, Holt & Co. (TPH). Over the
beyond 2022. same month, TPH said Japan and China com-
PGNiG is also intending to increase pipe bined consumed 50% of all LNG cargoes that
shipments from outside Russia, with the Bal- were shipped.
tic Pipe project, which will carry Norwegian But Asian LNG spot prices are now soften- Asian LNG spot
gas to Denmark and Poland, starting up in late ing, and as a result, US cargo loadings destined
2022. for Asia have declined, while those bound for prices are now
Europe have rebounded, according to Goldman softening, and as
European trends Sachs Commodities Research. There have also
PGNiG’s rising imports come as more and more been reports of vessels being diverted back to a result, US cargo
LNG from a variety of sources is being shipped Europe, according to comments from data intel-
to Europe. Croatia’s Krk floating LNG (FLNG) ligence firm Kpler in early February. loadings destined
import terminal started up early this year, and However, cold weather persists in other
more receiving capacity is under construction parts of the world, including China, and this is for Asia have
– notably in Greece, where the Alexandroupo- thought to be keeping LNG supplies to Europe declined, while
lis FLNG project is scheduled to come online in comparatively low. European levels of gas in
2023. storage are also lower than normal as a result. those bound
Goldman Sachs analysts believe that low Euro-
However, recent weeks have seen LNG vol-
umes that would go to Europe disrupted and pean storage inventories “will have a lasting for Europe have
redirected to Asia, where colder-than-expected tightening impact on European gas balances,
weather, supply outages and transport bottle- and hence on global gas prices” this year. rebounded.
necks caused a price spike and a scramble to Nonetheless, shipments to Europe are
procure cargoes. This is a contrast to the previ- gradually rebounding, and PGNiG will likely
ous winter, when mild weather depressed Asian not be the only European company expect-
demand, while China went into lockdown in ing to receive more LNG during the course
response to the coronavirus (COVID-19) of this year.
Week 06 12•February•2021 www. NEWSBASE .com P5
