Want to share with you all an insight as to the current market glut conversation, after researching all the worldwide BTA contracts from every exporting & importing country. I conducted the study as i was curious of the extent of supply from uncontracted, currently online LNG + projects that are under construction and due to come online... VS demand from existing importing countries and approved FSRU projects that are lock-ins to go ahead. I didn't cover European importing countries and will have missed a couple of South American terminals but apart from that... its a thorough, accurate report that will give you a feel for what suppliers are facing with the current market outlook. GV thinks the market will rebalance around 2022... but i feel it could be sooner in 2020 based on the figures i've dug up. Shell also has the same view.
Starting with the currently online & waiting to come online, uncontracted supply from the following exporting countries:
Qatar 78.2MT Capacity (Ras Gas, QatarGas 1-4) Uncontracted 1.4MT
Australia 86.6MT (Gladstone, Pacific, Pluto, Wheatstone, NWS, Gorgon, Ichthys, Darwin, Prelude, Curtis Island) - 4.32MT
Malaysia 29.3MT - 8.69MT
Indonesia 25.2MT - 4.66MT
Nigeria 30MT - 4.3MT
Algeria 26.5MT - 0.17MT
Oman 10.4MT - 0.5MT
Russia 27.3MT (Sakhalin, Yamal) - 1.47MT
Egypt 12.7MT (El Behera, Segas) Fully Contracted
Abu Dhabi 5.8MT - 1.5MT
Brunei 7.2MT - 0.87MT
Yemen 6.7MT - Fully Contracted
Peru 4.4MT - 0.72MT
Trinidad and Tobago 14.8MT - 4.66MT
Equitorial Guinea 3.4MT - Fully Contracted
Papua New Guinea 7.2MT - 0.7MT
Norway 4.2MT - 0.37MT
Mozambique 3.3MT - Fully Contracted
USA 75.75MT (Sabine Pass, Corpus Christi, Freeport, Cameron, Dominion Cove) - 17.54MT
Total 51.87MT
Contracts that are due to expire in 2018-19'
QatarGas 4 - 2Mt Centrica 5yr contract expiring in 2019. 1.1MT Petronas UK 5yr contract 2019. 1.5MT Eon 5yr contract 2019. Malaysia - 5.34MT Tokyo Electric 15yr contract 2018. 2.6MT Tokyo Gas 15yr contract 2018. Algeria - 7.4MT GDF 12yr contract 2019. Trinidad and Tobago - 3MT Cabot + Enagas 20yr contract 2019. 1.68MT Sonat 17yr contract 2019.
Total 23.52 in contract re-negotiations and I'm sure some of those companies will be looking elsewhere for better deals/contract conditions. QatarGas on June 17 and 19, signed contracts with Shell for a total of 6.6MT on 5yr deals (which covers expiring contracts from QatarGas 4).
Now the demand from existing importing terminals or approved FSRU projects that are locks to go ahead:
Kuwait 4MT Capacity. Looking for supply of 1.5MT - Project completed 2009.
Pakistan 14.3MT 6.89MT - 3rd terminal 5.5MT to be completed 2018.
Thailand 11.5MT 6.3MT - Completed 2011. 5MT expansion to be completed 2017 + 1.5MT completed 2019.
Singapore 9MT 6.3MT - Completed 2013. 3MT expansion to be completed 2017.
Bahrain 6MT 6MT - T0 be completed 2019.
Jordan 3.7MT Fully Contracted - Completed 2015.
Indonesia 6.4MT (West Java, Sumatra, Cilamaya) 3.22MT - Sumatra completed 2014. West Java 4MT to be completed 2020. Cilamaya, West Java, .60MT to be completed 2021.
Bangladesh 7.5MT 7.5MT - To be completed 2019.
Ghana 3.4MT 3.4MT - To be completed 2018-19.
Ivory Coast 3MT 3MT - To be completed 2018.
Abu Dhabi 3.7MT Fully Contracted - Completed 2016.
UAE 6MT Fully Contracted - Completed 2010.
India 14MT (H-Energy, Swan Energy, Ennore) 7.6MT - H-Energy 4MT to be completed 2018. Swan 5MT to be completed 2019. Ennore 5MT to be completed 2018.
Colombia 3.75MT 3.75MT - Completed 2016.
Chile 5MT (GNL Quintero, Mejillones) Fully Contracted - GNL completed 2009. Mejillones completed 2010.
Panama 1.5MT Fully Contracted - To be completed 2018.
Total 55.46MT from offtakers looking for suppliers.
Proposed FSRU projects that are likely to succeed:
Uruguay 4MT - Mitsui OSK Lines has signed a 20yr contract with Gas Sayago of Uruguay. The FSRU is currently under construction and is expected to start operations first half of 2018. On Jan 12, 2017, Shell was in talks to buy 100% of capacity.
India 3.5-5MT - Kakinada Terminal has stalled when on May 23, 2017, Shell and Engine(GDF Suez) exited the project. The 2 firms wanted Gail to guarantee a minimum sale of imported LNG before FID could be taken... Gail however said it couldn't guarantee any minimum off take in absence of indicative price of imported gas. Krishna Godavari Terminal in Kakinada, 9MT VGS??
Sri Lanka 2MT - Governments of Japan and India have reached an agreement to set up the terminal(Kerawalapitiya) as a 50:50 joint venture by Petronet and a Japanese company. It will take 3 years to build.
Chile 4MT - The Penco Lirquen project has been delayed by 12-18 months due to issues with environmental approval. It is making progress towards a FID in accordance with the revised project schedule. Hoegh has signed a 20yr contract to provide the FSRU, which is now expected to be commissioned between late 2019 and the second quarter of 2020. A 20yr SPA has been signed with Cheniere for .6MT starting in 2019.
Colombia 2.9MT - Second LNG terminal in Colombia is likely to be built near the port city of Buenaventura. Mining and Energy Minister German Arce mentioned the facility should be operational no later than 2024.
Vietnam 5MT - PetroVietnam is looking to set up 2 terminals in Thi Vai(1.4MT) and Son My(3.6MT) and is eyeing a 2023 start date. In March 2014, PV signed with Gazprom Singapore a SPA to buy LNG for the Thi Vai project then in June signed another SPA with Shell to supply Thi Vai.
UAE 4MT - Sharjah National Oil Corporation(SNOC) and Uniper have signed a deal with Sharjah Electricity & Water Authority for a 10yr Gas Sales Agreement starting in 2019. Germany's Uniper will design and construct the Sharjah import facility and also be responsible for the sourcing & supply of competitively priced LNG. In 2016, UAE LNG needs were 15MTPA , sourced from Qatar.
Thailand 7.5MT - PTT's CEO, Tevin Vongvanich, has said the company intends to build a second terminal and begin construction 2020 with operations starting in 2023. It has been granted government approval.
Philipines 4MT - With the Malampaya Gas fields nearing depletion in 2024, the energy secretary said its looking to build an FSRU for completion by 2020/21 in Batangas.
Hong Kong 3MT - Government wants an FSRU by 2020.
Mighty China has not been taken into account as there is no news on their demand outlook. So if you look at the big picture, its quite rosy from where I'm sitting... in terms of demand being alive in which it could possibly outweigh supply by 2020. Even with the following proposed projects nipping at our heels, definitely think there's enough growth to come to share amongst us all.
Our competition in the race to FID: Golden Pass (15MT Capacity) - NTP is knocking on the door as they received Non FTA approval on April 26 2017. Rio Grande (27MT) - still has about a year to go before reaching NTP... a tough job to fill there asking quota but their initial start-up production will be only 9MT. Woodfibre (Canada 2.1MT) - June 6, Government approved 40yr export licence and have HOA with Guangzhou Gas for 1MT, 25yr contract. Are looking to begin operations in 2020. Delfin (13MT) - Proposed initial export capacity will be 8MT with the option to expand depending on market conditions. Received NFTA approval on June 8 17' so NTP is just around the corner. I feel Tellurian is not in our rear vision mirror for the time being, having pre-filed in June 2016 with precedent indicating 14-17 quarters from then for greenfield projects... meaning possibly another 2 years till NTP. They do have a genious leader though in Charif Souki, who managed to rush through the approval process for Sabine Pass (trains 1-4) in 18 months and separately trains 5-6 in 27 months!
And the ant lived happily ever after! The end...
Expand
