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GLNG ASIA GLNG
Petronas signs LNG supply contract with Shenergy
PROJECTS & COMPANIES
MALAYSIA’S state-run Petronas has signed a long-term liquefied natural gas (LNG) supply agreement with China’s Shenergy Group.
The agreement will see wholly owned sub- sidiary Petronas LNG Ltd (PLL) supply the Chi- nese state-owned company with around 1.5mn tonnes per year (tpy) of LNG for 12 years from 2022, the Malaysian company said January 20. Petronas said the agreement would also involve a collaboration to build and charter new mid-sized LNG vessels.
Petronas has been supplying LNG to Shen- ergy, which is owned by the Shanghai municipal government, since 2006.
Petronas’s Malaysia LNG Tiga signed sale and purchase agreements (SPAs) with Shanghai LNG to supply up to 3.03mn tpy of LNG for 25 years in July 2006. The deal was Petronas’ first such sup- ply agreement with China. Shenergy owns 55% of Shanghai LNG, while China National Off- shore Oil Corp. (CNOOC) holds the remaining 45%.
The supply deal comes as Chinese demand for LNG continues to expand on the back of govern- ment efforts to increase consumption of natural
gas. Chinese imports of LNG in the first eleven months of 2019 climbed by 13.32% to 53.85mn tonnes of LNG.
China also began importing its first Rus- sian piped gas last month, with the 3,000- km Power of Siberia pipeline opening on December 2. State-owned China National Petroleum Corp. (CNPC) said on January 17 that Russian gas supplies had reached 328mn cubic metres.
At the same time, domestic gas production has surged in recent years in response to the country’s ever-expanding demand. Production climbed by 9.8% year on year in 2019 to 173.6bn cubic metres, according to National Bureau of Statistics data.
However, while pipeline imports and domes- tic production are projected to continue rising in the coming years, the outlook for China’s LNG remains strong, as underlined by Beijing’s recent trade deal with the US. The Sino-US agreement has seen China agree to import $52bn worth of US energy products in 2020-2021, with LNG anticipated to account for a large portion of the final figure.
AUSTRALASIA
Woodside’s 2019 production, revenue slide
PERFORMANCE
At Pluto LNG, Woodside’s share of LNG production shrank from 4.52mn tonnes in 2018 to 3.84mn tonnes in 2019.
AUSTRALIAN developer Woodside Petro- leum announced last week that both its pro- duction and revenue for 2019 had declined year on year.
Production fell from 91.42mn barrels of oil equivalent in 2018 to 89.56mn boe in 2019, while revenue slid to $4.95bn from $5.24bn, the company said in a quarterly performance report published on January 16. At the same time, the company trimmed its capital expenditure from $1.72bn in 2018 to 1.19bn in 2019.
Woodside’s share of liquefied natural gas (LNG) production at the North West Shelf (NWS) project declined from 2.7mn tonnes in 2018 to 2.51mn tonnes in 2019, while conden- sate production slipped from 4.76mn barrels to 4.7mn barrels. At Pluto LNG, the company’s share of LNG production shrank from 4.52mn tonnes in 2018 to 3.84mn tonnes in 2019, while condensate slipped from 3.05mn bar- rels to 2.61mn barrels. The company’s share of LNG production from the Wheatstone project climbed from 866,000 tonnes to 1.25mn tonnes in 2019.
The company has forecast that production in 2020 will reach 97mn-103mn boe, driven
by an anticipated jump in LNG production. The company produced 67.7mn boe worth of LNG in 2019, and forecasts that this will rise to 74mn-77mn boe.
Woodside CEO Peter Coleman said: “We are targeting increased production in 2020 follow- ing the successful execution of our near-term growth projects.”
One of these projects is the Browse LNG project in Western Australia. Woodside said it was ready to enter the front-end engineering and design (FEED) stage of the project subject to finalising a gas processing agreement. The company had been aiming to secure an agree- ment with NWS partner Chevron in 2019 that would pave the way for Browse gas to be pro- cessed at the NWS project’s LNG plant in Kar- ratha. Woodside operates both the Browse and NWS projects, while Chevron only has a stake in the latter.
Woodside said it had reached an agreement with BHP Billiton in November on the tolling price for processing gas from the Scarborough project via PlutoLNG. Woodside said in its quarterly report that it was aiming to finalise the agreement by the end of this quarter.
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w w w. N E W S B A S E . c o m Week 03 23•January•2020
