- Royal Dutch Shell’s floating LNG processing facility ship, Prelude, was launched on Tuesday.
- its the biggest vessel ever sent to sea
- 488-metre long hull
- It will take in the equivalent of 110,000 barrels of oil per day in natural gas and cool it into liquefied natural gas for transport and sale in Asia
- Built in Geoje, South Korea
Posts Tagged: liquefied natural gas
Cabinet will soon decide on putting a cap or limit to which natural gas prices can be increased following a new pricing formula coming into effect from April 1 next year, Oil Secretary Vivek Rae said on Wednesday.
The Union Cabinet had in June decided to price all domestically produced natural gas at an average of the price prevailing at international gas trading hubs and the actual cost of importing liquid gas (LNG).The pricing formula will be effective from April 1, 2014 for a period of five years, with the price being revised quarterly.
The price for each quarter will be calculated based on the 12-month trailing average price with a lag of one quarter (i.E. Price for April to June 2014 will be calculated based on the averages for 12 months ended December 31, 2013).
Using the approved price formula, the price effective for April 1, 2014 is estimated at around $8.40 per million British thermal unit, double the current price of $4.20. >> Read More
Finmin for cap on gas prices from RIL’s KG-D6; higher prices only after finding out reason for output fall11 October 2013 - 7:28 am
The finance ministry has formally launched a move to cap the rise in gas prices and said Reliance Industries should not automatically get higher rates for existing fields, in a stern note that also asserts the State’s power to eject the company from the gas-rich KG-D6 block.
Capping the price of natural gas is in line with existing policy, said the ministry, as the current price was a variable one with an upper limit of $4.2 per unit. “Therefore, there is no ambiguity as to whether the price ceiling is permissible under the PSC (production-sharing contract),” it said.
Reliance contests this interpretation of PSC, saying the contract allows market prices subject only to the condition that these be determined on an arms-length basis. The chief executive officer of Reliance’s partner BP Plc, Bob Dudley, is visiting India next week and is expected to discuss these issues with Oil Minister Veerappa Moily. He is also scheduled to share the stage with BJP’s prime ministerial candidate Narendra Modi at the convocation of a university, where Mukesh Ambani heads the board of governors. >> Read More
Even as the increase in domestic natural gas price is being hotly debated, not much information is available on the actual cost of production, and whether there is any linkage between price and cost.
The gas pricing formula of the government takes into account prices in global hubs and the price of gas being imported into the country without any weightage to the cost of production.
Unlike the power sector, in which the cost of a unit of electricity can be segregated into fixed and variable costs, pricing in the petroleum sector has global linkages. That’s why the cost of producing oil and gas is not readily known.
A questionnaire sent to Reliance Industries Ltd (RIL) seeking the private explorers’ cost of production went unanswered. The company has spent about $14 billion in exploration and production, with about $10 billion spent on the KG-D6 wells, while it has produced 2.2 trillion cubic feet (tcf) of gas from D1 & D3 fields. >> Read More
The new formula for setting gas price may be up for review again with the finance ministry suggesting the need for a cap.
The department of expenditure has asked the petroleum ministry if a ceiling or limit can be imposed on the extent to which gas prices can be raised based on the cabinet-approved formula of using imported LNG and international hub rates as benchmarks. >> Read More
The chairman of the Suez Canal Authority is coordinating a “high alert” military response as protests escalate against President Morsi. The army and navy stepped up patrols of the 190-kilometer (118-mile) canal linking the Red and Mediterranean seas about a week ago, he said. “Closing the canal outright would be very difficult without the support of the military,” Barclays notes as the army and navy steps up patrols of the 190km canal.
While unrest that toppled Hosni Mubarak, Mursi’s predecessor, failed to halt traffic last year, fewer vessels passed along the canal. An average of 1,435 ships a month used the link, the lowest figure since 2005. So far, traffic is “normal and has not faced any disruptions.”
The canal handles about 8 percent of seaborne trade, according to Barclays. It carried about 4.5 percent of global trade in oil in 2011, the bank said. The waterway also carries about 14 percent of liquefied natural gas cargoes, the note showed.
About 800,000 barrels of crude and 1.4 million barrels of refined fuels passed along the canal daily in 2011, the bank said, citing data from the U.S. Energy Department. An adjacent pipeline carried an additional 1.7 million barrels a day, it said. >> Read More
Rosneft has signed a deal to supply China with $270bn worth of oil over the next 25 years, as Russia looks to boost ties with the world’s largest energy consumer.
The contract is set to be followed by an agreement by Novatek, Russia’s largest independent gas producer, with China’s Sinopec to take a stake in its $20bn liquefied natural gas project on Russia’s remote Yamal peninsula.
The two deals mark at least a partial pivot towards Asia as Russia seeks to exploit China’s ever-growing appetite for energy, amid stagnant demand from Europe and attempts by European countries to reduce reliance on Russia.
Igor Sechin, Rosneft chairman, said the state-controlled group would supply 365m tonnes of oil to China starting from next month. He added that the deal with China represented just one of 30 agreements that Rosneft would sign at the St Petersburg International Economic Forum, the state-organised annual investor conference. >> Read More
In the latest step toward internationalising the US shale gas boom, the developer of a $10bn LNG export facility in Louisiana has agreed to sell half its stake in the project to a group of Japanese and French companies.
Japan’s Mitsui & Co, Mitsubishi Corp and Nippon Yusen, together with GDF Suez of France, had previously signed on as buyers of the liquefied natural gas that is to be shipped from the planned Cameron LNG facility starting in 2017.
Now, they have agreed to provide construction financing in return for equity stakes totalling 49.8 per cent, the companies said on Friday. The deal reflects expectations that US restrictions on natural gas exports that have largely limited supplies to domestic customers will soon be eased. >> Read More
So far, so good for “Abenomics”. Japan’s stock markets are soaring, property is bubbling, and consumer confidence is at its highest level for six years.
And after months of expectations for aggressive monetary easing, the yen has been bumping up against the key threshold of 100 to the dollar, a level it last saw just over four years ago.
Since mid-November, when it became clear that Shinzo Abe’s campaign to reflate the world’s third-largest economy would carry him to victory in parliamentary elections, Japan’s currency has lost at least one-fifth against every one of the G10 currencies, causing trading partners from South Korea to Russia to mutter about unfair advantages.
But does a much weaker currency really make Japan Inc a more formidable competitor?
Economists are unsure. In the past, the correlation seemed a reliable one: a weaker yen would lift profits at exporters, who would then plough more funds into hiring, higher wages and capital investment. >> Read More
It is becoming ever clearer that the roaring boom in global equities since last summer has priced in an economic recovery that does not in fact exist. The International Monetary Fund has had to nurse down its global growth forecasts yet again. We are still stuck in an old-fashioned trade depression, with pervasive over-capacity in manufacturing plant and a record global savings rate of 25pc of GDP.
German car sales fell 17pc in March. That should puncture the last illusions that Germany is about to pull Europe out of a self-inflicted slump.
As you can see from the chart below, the divergence between stock markets and the Deutsche Bank index of raw materials is astonishing to behold, so like the pattern in early 1929. >> Read More