Shell begins restart activity at Prelude FLNG
Shell has begun restart operations at its 3.6mn t/yr Prelude floating LNG (FLNG) facility offshore Western Australia (WA), which has been off line since February. But it has yet to define the timeline for when production will resume.
"The process for hydrocarbon restart of Shell's Prelude FLNG facility has commenced," a Shell spokeswoman said. "Once we have safely started up, we will be in a stronger position to talk about timing of production and cargo."
Shell suspended cargo loadings at Prelude in February because of technical issues. This followed an order from Australia's upstream regulator the National Offshore Petroleum Safety and Environmental Management Authority (Nopsema) in late January to carry out additional work following three safety incidents at the plant between 18 September and 9 January.
Shell said at the end of July that it expected to reduce LNG output in the third quarter because of the continued impact of Covid-19 on global gas demand, with the reduction expected to take place across several assets in Australia and Trinidad & Tobago. It expected its LNG liquefaction volumes to range between 7.6mn-8.2mn t during July-September, down from 8.95mn t a year earlier and below the 8.36mn t in April-June this year.
Nopsema in August accepted Shell's proposal to develop the 2.2 trillion ft³ (62.3bn m³) Crux gas field in the Browse basin offshore WA, which is expected to provide backfill gas for Prelude. The development of Crux is subject to further regulatory approvals, including an accepted environment plan, a well operations management plan and a facility safety case. Shell is required to obtain all required regulatory approvals before activity on Crux can begin, Nopsema said. The firm in April delayed a final investment decision on Crux until early next year because of weaker global LNG demand and lower oil prices because of Covid-19.
Shell also operates the 8.5mn t/yr Queensland Curtis LNG on Curtis island in Queensland.
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Shell to step up gas exploration in Oman
Shell to step up gas exploration in Oman
Dubai, 23 May (Argus) — Shell Oman is actively looking to explore more wells in the sultanate's onshore blocks after production reached a "little above" the plateau target of 500mn ft³/d (5.2bn m³/yr) in its core block 10 this month, according to the oil company's country chairman, Walid Hadi. Hadi told Argus that the company has embarked on an "aggressive exploration" campaign to unlock the potential in Oman's core onshore blocks 10 and 11 in which Shell has operating stakes. The blocks are part of the gas-rich Greater Barik area in the northern segment of state-controlled PDO's block 6 concession in the central region of Oman. "Oman is a niche gas sector," Hadi said. "It may not be the biggest LNG exporter in the world, but there is quite a sophisticated and high-quality gas system in place." Shell, which is also the majority private shareholder in state-owned Oman LNG, expects to boost gas production for domestic purposes and eventually for exports, according to Hadi. "We will require new gas if we are going into LNG," he said. "We know there is more potential in the blocks, but we still don't know at what scale it can produce as the two blocks are a combination of undiscovered and discovered resources." TotalEnergies said earlier this year that Oman LNG was eyeing a fourth train at its 11.4mn t/yr Qalhat LNG export terminal, having already added 1mn t/yr in liquefaction capacity through plant debottlenecking. Hadi said that Shell is planning on a "material increase" in gas production and would be able to conclude the growth potential of the blocks by mid or late 2025, when it completes the exploration programme. Gas from block 10 is sold to the government through the Integrated Gas Company, which is the entity that allocates the gas across different sectors based on certain policies and value criteria, according to Hadi. Shell has a 53.45pc stake in the block, with Marsa LNG and OQ holding 33.19pc and 13.36pc, respectively. The partners signed the concession agreement for block 10 in December 2021. The adjacent block 11 was awarded to OQ and TotalEnergies in 2021. When it comes to block 11, the company did make a material gas discovery, which is being appraised this year, but it is too early to talk about the production potential, Hadi said. "We also see quite a bit of potential in block 11 already." "Exploration is a very tricky business," he added. "You have to go after a lot of things and only few will end up working. We are at a very aggressive exploration campaign at the moment. We also expect by the end of 2025, we would be in a much better position to determine the next wave of growth and where it's going to come from." By Rithika Krishna Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
China’s natural gas consumption to peak in 2040: CNOOC
China’s natural gas consumption to peak in 2040: CNOOC
Singapore, 23 May (Argus) — China's state-controlled CNOOC expects domestic natural gas consumption to peak at 700bn m³ in 2040, said CNOOC's senior economist Xie Xuguang at a liquefied fuel shipping conference in Chongqing over 22-24 May. The conference was jointly organised by the China Shipowners' Association and Langfang International Pipeline Exhibition. CNOOC also estimated China's gas consumption to hit 410bn m³ in 2024. These most recent projections are aligned with earlier estimates from fellow state-controlled CNPC 's economic and technology research institute in Beijing, which forecast Chinese gas demand will rise by 24bn m³ in 2024 in its annual report published on 28 February. International Gas Union's president Li Yalan expects natural gas consumption in China to hit 500bn m³ in 2030 and eventually 650bn m³ in 2040. And all above growth scenarios could in fact be further enhanced should gas prices remain at "reasonable" levels, she added. She did not expand on the definition of "reasonable", but recent buying interest from mostly second-tier buyers in China hinted that the ideal target price considered acceptable for buyers in the country could be no higher than $9-9.50/mn Btu. Current spot prices are still considered way out of reach for Chinese importers. The front half-month of the ANEA — the Argus assessment for spot LNG deliveries to northeast Asia — was last assessed at $11.525/mn Btu on 23 May, $1/mn Btu higher from a week earlier. Factors such as higher-than-average temperatures in northeast Asia, southeast Asia, south Europe and the US, and some remaining concerns over production outages in the Atlantic and Pacific basins have resulted in European gas hub prices strengthening and Asian spot prices also jumping higher as a result. This is despite higher-than-average inventories in traditional major importing countries such as Japan and South Korea, and expectations of higher nuclear availability in Japan and South Korea to weigh on gas-fired generation in the summer . But traders have also pointed out that such higher prices may compel buyers in Asia to withdraw from the spot market, freezing out additional demand and eventually weighing on prices again. China has continued to step up its LNG imports even as domestic gas production extended gains in April . The country imported more LNG in April as compared to in 2023, and imports even hit a record high in March . Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
UK general election set for 4 July
UK general election set for 4 July
London, 22 May (Argus) — A general election will take place in the UK on 4 July, prime minister Rishi Sunak said today. The announcement coincides with official data showing that UK inflation has fallen to its lowest level in nearly three years. Labour, the country's main opposition party led by Keir Starmer, has held a substantial lead in polls in recent months and performed well in local elections earlier this month. It won nearly 200 seats on local councils, as well as several regional mayoral contests, while the ruling Conservative Party lost almost 500 council seats. The Conservatives have been in power since 2010 and have fielded five prime ministers during that time. The two main parties are likely to release more detailed manifestos once the election campaign begins, but their current respective energy policies have many similarities. Both back a windfall tax on oil and gas producers and support nuclear power. They both also support offshore wind and solar power, although Labour has incrementally more ambitious targets for those renewables and has plans for more onshore wind. Labour also wants a zero-carbon power grid by 2030 , while the Conservatives are aiming for that in 2035. The Conservatives have rolled back some climate policy since Sunak became prime minister, while Labour in February backed down on its pledge to spend £28bn/yr ($35.6bn/yr) on the country's energy transition, if it wins the election. For a general election to take place in the UK, the prime minister must request permission from the British monarch — King Charles III — who then dissolves parliament. A general election must take place at least once every five years in the UK, although a prime minister can call one at any point. The UK's last general election was held on 12 December 2019 and Boris Johnson was elected prime minister. There have since then been two prime ministers — Liz Truss in September-October 2022 — and Sunak. Truss was selected by Conservative Party members and Sunak became prime minister in October 2022 after the only other candidate withdrew from the leadership contest. The Conservatives hold 344 seats out of 650 in the House of Commons, the UK's lower house of parliament. But 105 members of parliament have said that they will not run at the next election, 66 of whom are Conservatives. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Japan’s Mol adds to LNG fleet for Jera
Japan’s Mol adds to LNG fleet for Jera
Osaka, 22 May (Argus) — Japanese shipping firm Mitsui OSK Lines (Mol) is to launch a new LNG carrier in 2026, the seventh vessel to be supplied under an unspecified time charter agreement with the country's largest power producer by capacity Jera. The 174,000m³ membrane-type vessel is being built by South Korean shipbuilder Samsung Heavy Industries at its Geoje shipyard. It will be installed with a dual-fuel engine that can run on low-sulphur fuel oil or boil-off gas stored in the ship's cargo tank, Mol said. LNG is dominant in Jera's power portfolio, with its gas-fired output accounting for 75pc of its power generation in the April 2023-March 2024 fiscal year. The company consumed around 23mn t of LNG during 2023-24, which accounted for 35pc of Japan's LNG imports of 64.9mn t. Jera is planning to maintain its LNG handling volumes at no less than 35mn t/yr until 2035-36 , so to ensure power security in Japan through more flexible operations. It is also looking to further promote LNG along with renewable electricity in Asian countries, while helping to reduce their dependence on coal- and oil-fired power generation. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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