Having covered GV's solid resume before, would like to delve deeper into JB's impressive background. Mr. Baguley joined LNG Limited in May, 2014 as Chief Operating Officer for the Magnolia LNG project and has since also assumed the role of Chief Technical Officer for LNG Limited. He brings over 35 years of LNG and petrochemical project design and delivery experience to our organization, including 33 years with global LNG EPC contractor KBR. JB's extensive project experience over the past three decades covers some of the world’s earliest and most innovative major LNG export and import facilities, including the delivery of;
Malaysia's LNG Trains 1-3 in Bintulu.
Woodside's Northwest Shelf Trains 1-2 in Karratha, Australia.
CPC's import terminal in Yong An, Taiwan.
Tangguh LNG Trains 1-2 in W Papua, Indonesia.
Pertamina's Bontang Train H in East Kalimantan, Indonesia.
Qatargas LNG Trains 1-2 in Qatar.
He was also responsible for leading the design and delivery planning teams for the Anadarko Mozambique LNG project, Woodside's Browse LNG project at James Price Point in Australia and Petronas's Pacific Northwest LNG project on Lelu Island in British Columbia, Canada (cancelled).
He rates the Tangguh LNG project as "undoubtedly one of the most difficult projects ever built outside of a war zone. The extreme remote nature of the site and the abject lack of any regional infrastructure rendered it an incredible challenge".
KBR, who has been involved in about 40% of the current global LNG production capacity, has guaranteed the production rate, energy efficiency, and costs of OSMR under our executed lump sum contract. All elements of the OSMR technology are well proven. It has been tested on a facility in Karratha, Australia, on the Maitland Industrial Estate which is a small-scale application of the primary elements of OSMR. It is about a 10% scale project – it produces 0.1 mtpa, compared to one of the modules in Magnolia that has 2 x 1.0 mtpa liquefaction units (2 mtpa per train, but each train has two liquefaction units). Potential customers have performed technical due diligence and have universally accepted the technology!
With Brent Crude Oil hitting $73.38 at 09:28am EDT today, Saudi Arabia is targeting a price of $80 a barrel to boost the valuation of its state-owned oil company, Aramco, before its initial public offering.
That also happens to be the forecast of commodity strategists at Goldman Sachs, who forecast that
Brent crude, the international benchmark of prices, would rise to $80 a barrel by the fourth quarter of this year. "We expect that global oil demand will remain strong this year and contribute to further declines in oil inventories," Damien Courvalin, Goldman's head of commodity research, said in an address on Thursday the 17th of April.
During the boom times for new projects reaching FID, between 2002-2005 & 2011-2015, the statistics on the price of Brent Crude Oil during those periods reads as follows. For interest sake, i'll also include what the highs and lows were in the run up to 2002 to indicate how low Brent Crude was many moons ago;
1997 - High $24.83/BBL Low $16.69/BBL
1998 - High $16.28/BBL Low $9.10/BBL
1999 - High $26.46/BBL Low $9.77/BBL
2000 - High $37.43/BBL Low $21.05/BBL
2001 - High $29.80/BBL Low $16.51/BBL
2002 - 19.1mt worth of new projects reached FID * Brent Crude Oil reaches high of $31.49/BBL low of $18.17/BBL
2003 - 17.6mt FID * Brent Crude Oil reaches high of $34.94/BBL low of $23.23/BBL
2004 - 23.4mt FID * Brent Crude Oil reaches high of $52.28/BBL low of $29.02/BBL
2005 - 46mt FID * Brent Crude Oil reached a high of $67.26/BBL low of $40.75/BBL
2006 - 4.5mt FID 2007 - 8.8mt 2008 - 4.7mt 2009 - 17.4mt 2010 - 8.6mt
2011 - 26.9mt worth of new projects reached FID * Brent Crude Oil was above $100/BBL all year bar 24 days, reaching a high on Apr 8 of $126.65 *
2012 - 23.7mt FID * Brent Crude Oil above $100/BBL all year bar 24 days, reaching a high on Mar 12 of $126.22 *
2013 - 29.1mt FID * Brent Crude Oil above $100/BBL all year bar 5 days, reaching a high on Feb 8 $118.90 *
2014 - 27.6mt FID * Brent Crude Oil above $100/BBL all year until Sept 09 where it hits $99.16 and begins to tumble/ crash triggered. Reached high on Jun 19 of $115.06 *
2015 - 20.3mt FID * Brent Crude Oil below $100/BBL all year, reaching a high on May 5 of $67.52 and a low on Dec 22 of $36.11 * Freeport Train 3 (4.4mt), Corpus Christi Train 1 & 2 (9mt), Sabine Pass Train 5 (4.5mt), Cameroon Kribi Train 1 (2.4mt) were the projects to reach FID.
* Note the lull in buying during the period 2006-2010 before the market picked up speed once more. We're experiencing a similar scenario today with a seemingly 3rd quiet year on the trot being on the cards.
Brent Crude is on the march though and I'd say we've crept right up on the "sweet spot" to entice buyers to sign on the dotted line! Coupled with the following report from Sanford C. Bernstein the once hazy macro environment is now shining brightly;
The stalemate between buyers and sellers of LNG that has held back investment in global liquefaction capacity must end soon, Sanford C. Bernstein has warned. The industry must build as much as 200 mtpa of new capacity by 2025 to plug a looming supply gap, the research and brokerage firm said in a new report.
“There continues to be a dearth of new projects approved as the stand-off between buyers and sellers continues,” Bernstein analysts, including Neil Beveridge, wrote in a report on Monday.
“Buyers will have to come off the fence sooner rather than later if they are to ensure supply security,” Bernstein analysts added. “We expect a new capex cycle to start in 2018 or 2019 at the latest, as new projects are required to meet market demand.”
Just awaiting the anticipated CR to see us through till end of 2019 and from that moment... i feel we're
safely home!
