LNG NEWS WEEKLY DATE 18th JUNE 2021

LNG MARKET POISED FOR BUOYANT RECOVERY WITH DEMAND GROWING

ACROSS ASIA
Higher oil and coal prices have also helped lift global gas prices with spot Asian LNG prices doubling in just three months.
Liquefied natural gas (LNG) prices are poised for more gains as gas-hungry China guzzles cargoes to feed a rebound in
economic growth while the easing of coronavirus-induced restrictions restores industrial demand in India. Higher oil and coal
prices have also helped lift global gas prices with spot Asian LNG prices doubling in just three months. "We believe this has
been driven by a tightening of Asian LNG balances led by strong generation demand in southern China at the same time that
South Korea reached peak nuclear maintenance, while Covid-hit India LNG demand has stabilized," analysts from Goldman
Sachs said in a note earlier this week. China imported more than 7 million tonnes of LNG in May, a record for that month,
and looks set to import more over the next two months driven by strong industrial activity. "Fuel-switching (from coal) across
households and businesses appears to have regained momentum after a brief hiatus, and now has an added policy boost that
is heavily oriented around increasing clean fuels use and decarbonisation,"

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Fitch Solutions said. South Korea's newest and biggest nuclear reactor, Shin Kori-4, shut last month after a fire, which is
expected to boost LNG demand. An official at operator Korea Hydro & Nuclear Power Co said it was not clear when the
reactor would resume operations. Tokyo Gas, Japan's biggest city gas provider, may boost storage capacity using LNG tankers,
chief financial officer Hirofumi Sato told Reuters in April, potentially lifting imports. Utilities in Japan, the world's top LNG
importer, faced a power crisis last winter which caused LNG prices to spike to record highs. Temperatures in Tokyo, Seoul
and Shanghai are expected to be warmer than usual over the next two weeks, according to Refinitiv Eikon weather data,
further boosting gas demand in Japan, South Korea and China for power generation. India's gas consumption is seen recovering
in June after declining in the previous two months, as states ease restrictions in the wake of a drop in coronavirus infections,
officials said this week.

Gas consumption in the world's fourth largest LNG importer could grow by 6% to 8% in the current fiscal year if the country
emerges from the pandemic, Manoj Jain, chairman of GAIL (India), India's biggest gas pipeline operator, said. Europe's LNG
demand remains robust too, as imports are expected to refill storage levels which hit multi-year lows recently on pipeline
supply concerns stemming from rising Russia-Ukraine tensions and a surging carbon market which may spur power producers
to opt for LNG over coal, Fitch Solutions said. Supply issues, both planned and unplanned, plague some plants in the United
States, Australia, Malaysia and Indonesia, and are also supporting prices, traders said. That's crowding out some demand
from price-sensitive buyers like Pakistan and Thailand, who have received only high offers for tenders seeking cargoes for
July. Overall, Asia LNG prices are expected to average about $7.30 per million British thermal units (mmBtu) in 2021 and
$7.50 per mBtu in 2022, up from $4.20 per mBtu last year, said Kieran Clancy, assistant commodities economist at Capital
Economics. "The outlook for LNG demand further ahead remains bright, as it is used to plug the gaps in power generation
that are not currently able to be met by renewables," he added. source : https://energy.economictimes.indiatimes.com/news/oil-and-gas/

MOZAMBIQUE LNG NEWBUILDINGS DEADLINES PUSHED FURTHER BACK

Total Energies and partners keep the dream alive for East Africa project, four shipowners and two yards. Signing deadlines
on newbuilding and time charter contracts for 17 LNG carriers worth more than $3bn have been extended as Total-Energies
and its partners hang fire on their Mozambique LNG project. Shipbuilding sources said an end-of-May date on the vessels —
nine of which are to be built at Hyundai Samho Heavy Industries and eight at Samsung Heavy Industries — has been pushed
out into September. Delivery dates, originally due to start from about the end of 2023, will now begin in the second quarter
of 2024. Mitsui OSK Lines has signed up to five vessels and K Line four at Hyundai Samho, while NYK Line and Maran Gas
Maritime are on four apiece at SHI. It is unclear if a six-month delay will give shipbuilders any opportunity to conjure up new
berths for other vessels. Newbuilding slots are in short supply at the major South Korean yards because of a rush on
containership orders. Brokers also question whether there will be price rises on the ships in view of recent steel plate cost

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increases. One said the ship specifications had been drawn up some time ago and there may be interest in -updating them,
although this -could prove too complex. Initial contracts on the 17 ships were pencilled in at the end of 2020. But confirmation
of the vessels and the charters on them was conditional on the project moving ahead, with the partners having the option to
cancel before the May deadline. In the interim, lead shareholder TotalEnergies — the French energy major that changed its
name from Total at the end of May — declared force majeure on the 12.88-million tonnes per annum project on 26 April after
a rise in the number and severity of attacks by militant insurgents in the country. The attacks closed in on the project’s Afungi
site in the northern province of Cabo Delgado and all personnel were evacuated. TotalEnergies, which holds a 26.5% stake in
Mozambique LNG, later said it was pushing back the project start date by one year and expressed hopes that the security
situation would improve. TradeWinds has been told by staff handling the newbuildings and shipping elements of the -project
out of Singapore that the number of employees there was slimmed down in the wake of the delays, with just a skeleton team
remaining. The delays to Mozambique LNG, which will be the first major onshore liquefaction project in East Africa, give rivals
the chance to steal a march and mop up LNG buyers. Russian gas producer Novatek has announced plans to advance the
delivery of the third train to 2025 for its under-construction, 19.8-mtpa Arctic LNG 2 project. The company is engaged in a
-tender process for a raft of Arc4 LNG carrier newbuildings to handle part of the shipping requirement. Qatar is also said to
be “on schedule” with its North Field Expansion project, which will boost its exports from 77 mtpa to 127 mtpa. Qatar Petroleum
has reserved more than 150 berths spread across South Korea’s big three yards and China’s main LNG shipbuilder, and is
expected to move forward on the first newbuilding contracts for these this year. source : www.tradewindsnews.com

LNG NEWBUILD PRICES EDGE TOWARDS $200M MARK

The price of an LNG carrier -newbuilding is edging up towards $200m because of steel price rises, currency weakness and
the higher cost of equipment. Brokers said levels have climbed by $10m to $15m this year after hovering about $185m for four
years. One senior expert said prices are currently around the mid-$190m level, but extra features to improve efficiency would
push this to the high-$190m level and above. Another, who recently helped conclude an order, said prices had already tipped
over the $200m mark. Shipbrokers cited the rise in the price of steel, which has affected newbuilding costs across all ship
types. The weak US dollar is another factor. Equipment manufacturers are also said to have pushed their prices higher on the
back of the huge number of orders expected from Qatar, which has reserved more than 150 berths. The price increases come
as some LNG shipowners start to take a fresh look at newbuilding berths. TradeWinds reported in April that Danish shipowner
Celsius Shipping had been in talks with shipyards for up to four berths. Chairman Jeppe Jensen admitted to LNG “growth
ambitions” when asked about the company’s interest, without saying more. ­Celsius is said to remain undecided on the ships
at present. Minerva Marine and Capital Gas are also understood to be showing interest in LNG carrier berths. Newbuilding
brokers said quite a few owners have been eyeing up LNG slots for some time. They said some still retain options that they
must make decisions on, as yards are not offering extensions in light of alternative high-margin containership business they
can get in place of LNG newbuildings. Going into 2021, market players were somewhat spooked by the prospect of more than

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50 newbuilding deliveries that were planned for this year, a chunk of which were unfixed. But the year began with a bang and
charterers were caught out by the demands of the cold winter in Asia, which sent them scrambling to fix spot ships at record
rates. To avoid a similar situation next winter, charterers have been mopping up the bulk of that unfixed speculative tonnage,
with brokers and consultants quoting just four or five vessels as remaining without contracts. source : www.tradewindsnews.com

UNIPER UNIT SECURES BIO-LNG FOR GERMAN FILLING STATIONS

Liqvis, a subsidiary of German energy company Uniper, has signed a deal for bio-LNG supplies from EnviTec Biogas for sale
at its filling stations in Germany. EnviTec's bio-methane plant in Gustrow will be able to produce bio-LNG in autumn 2022,
and supplies to Liqvis will begin in the third quarter of that year, EnviTec said on June 7. Liqvis has been operating LNG filling
stations since 2017, providing fuel for heavy goods vehicles. "As supplies of bio-LNG have been limited in the past, it’s likely
that we will not be able to meet customer demand in full initially," Liqvis managing director Sebastian Groblinghoff said.
"However, we are increasing the proportion of bio-LNG in our portfolio as part of a continuous process that will ensure we
can offer an attractive bio-LNG product to all of our customers." source : www.naturalgasworld.com

HÖEGH LNG ACQUIRES MINORITY STAKE IN GEN2 ENERGY

While the market for seaborne transportation of green hydrogen does not exist on a large scale at present, the partnership is
looking to make early inroads in anticipation of future developments. Concurrently, Höegh has agreed to acquire an unspecified
minority stake in Gen2Energy. ‘Green’ hydrogen can be produced at cost-competitive levels, but several optimal production
sites are at remote locations, making transport by land expensive. By transporting hydrogen at sea, the two parties aim to
reduce transport costs. Höegh LNG’s contribution will relate to the company’s experience of shipping and importing natural
gas, establishing energy infrastructure and maintaining the logistics chain. Gen2 Energy will contribute its knowledge and
experience in production and safe handling of green hydrogen. The parties will also explore the use of carbon-free propulsion
systems for vessels and the potential for injecting hydrogen into the natural gas transmission grids. Gen2 Energy chief executive
Jonas Meyer said the agreement brings both companies “one step closer” to the goal of providing European energy markets
with fossil-free hydrogen on a large scale, adding “we are extremely pleased to engage in this important collaboration with
such an experienced actor. It also fits very well with Gen2 Energy’s announcement with Port of Cromarty Firth last week, which
to my knowledge was the first-ever export agreement for green hydrogen from Norway”. Last week, the Port of Cromarty Firth
signed an MoU with Gen2 Energy to develop a channel for hydrogen imports into Scotland. Höegh president and chief executive
Sveinung J S Støhle added “We are delighted to be both shareholder and a partner with Gen2Energy on seaborne hydrogen
transportation. It is a critical element of the hydrogen value chain and one that Höegh LNG is uniquely positioned to serve.
Gen2Energy has the potential to be one of the first large-scale suppliers of green hydrogen to market with Höegh LNG taking
a leading infrastructure role.” source : www.rivieramm.com

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OMAN LNG TO DELIVER SULTANATE’S FIRST CARBON-NEUTRAL LNG
Oman LNG will supply LNG cargo utilising nature-based offsets from a facility in the Omani port city of Sur. Shell described it
as “the first carbon-neutral LNG from the Middle East using nature-based carbon credits to offset the full lifecycle CO2
emissions generated across the LNG value chain.” The agreement is part of Shell’s ‘Nature-based projects’ carbon offset
programme. It is unclear which company is responsible for offsetting the carbon and where this project will be located. A
statement from Shell said, “This collaboration allows Oman LNG to tap into the knowledge and expertise of Shell while it
translates Oman LNG’s bold commitment towards knowledge sharing and exploring suitable mechanisms to reduce emissions.”
"When CO2 emissions are hard to abate, they can be compensated through offset from projects that are independently verified
to capture or reduce CO2 emissions and create carbon credits, which can be retired to demonstrate an amount of CO2
emissions have been compensated for," Oman LNG said. Oman LNG has initiated other projects to eliminate its carbon
footprint, such as the ongoing Power Project Plant. The move to introduce the gas engine power plant is to conserve natural
gas and reduce emissions. Gas savings accumulated through this project are aimed at producing power for the company’s
facility with less natural gas by optimising gas resources and reducing resulting emissions. Oman LNG chief executive Hamed
Al Naamany commented “Using high-quality nature-based offsets for Oman LNG’s first carbon-neutral LNG cargo offering is
a testimony of our commitment to the environment, and our focus on decarbonisation. We continue to be among the top
quartile of the premium LNG market, and aim to remain in this position post-2025”. source : www.rivieramm.com

LNG ENVIRONMENTAL PERFORMANCE: CHENIERE DEAL TO QUANTIFY GHG

EMISSIONS AT GAS WELLS
In collaboration with five natural gas producers and several academic institutions, Texas-based Cheniere Energy – the largest
LNG producer in the US – will implement quantification, monitoring, reporting and verification of greenhouse gas emissions
performance at natural gas production sites. The co-operation with the natural gas producers is intended to improve the overall
understanding of upstream GHG emissions and further the deployment of advanced monitoring technologies and protocols. It
will also support Cheniere’s climate strategy initiatives, including the company’s plan to provide cargo emissions tags (CE Tags)
to LNG customers beginning in 2022. The producers participating in the project are Aethon Energy, Ascent Resources – Utica,
EQT Corp, Indigo Natural Resources and Pioneer Natural Resources USA. “Collaboration with our natural gas suppliers is a
key component of Cheniere’s focus on quantifying and improving environmental performance,” said Cheniere president and
chief executive Jack Fusco. “This collaboration reinforces our data-driven environmental transparency, supports our CE Tags
and enhances our efforts with natural gas suppliers to monitor and verify emissions to maximise the climate benefits of
Cheniere’s LNG.” The initiative will use ground-based, drone, aerial and satellite monitoring technologies to establish baseline
emissions levels, monitoring sites for CO2 and for both fugitive and vented methane emissions. The initiative will also verify
emissions performance and identify opportunities to reduce emissions. The initial effort will cover production wells in the
Haynesville, Marcellus, Permian and Utica basins that collectively produce about 360 million standard cubic feet per day

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(mscfd) of natural gas, as well as multiple tank batteries. The project is being run by a subsidiary of Cheniere and is supported
by researchers from the Payne Institute for Public Policy at the Colorado School of Mines, Harrisburg University of Science
and Technology, SLR International and other emissions monitoring technology providers, including Montrose Environmental,
SeekOps, Bridger Photonics. and GHGSat. source : www.rivieramm.com

LOI SIGNED FOR AUSTRALIAN AMMONIA-READY LNG BUNKERING VESSEL

Kanfer Shipping is focused on small-scale LNG sea transportation and bunkering and has signed a letter of intent (LOI) to
bring the world’s first ammonia-ready LNG bunkering vessel to Australia. Oceania is progressing its LNG bunker licence
applications with port authorities and is engaged in preliminary talks with Australian natural gas and green ammonia producers.
Oceania director Nick Bentley said “Australia is uniquely positioned to be the world leader in providing zero-carbon fuels to
the shipping industry. At Oceania, we are thrilled to be working with Kanfer Shipping to activate Australia’s competitive
advantage, connecting its production of sustainable energy with its position at the apex of the Asia-Pacific commodity trade
route. The opportunity will drive new avenues of high-grade technical employment, while preserving our environment and
ensuring future energy security.” Kanfer has an exclusive design licence with LNG technology provider CGR Arctic Marine,
focused on enabling liquid gas transportation with the lowest possible environmental footprint and achieving zero-emissions
marine transportation. The vessel design uses LNG as a fuel and Kongsberg Maritime’s energy-saving technology. With future
modification, the Rolls-Royce Bergen gas engines can be converted to operate on ammonia. The vessel is designed for
simplicity and can be adapted to load LNG, methanol or ammonia. Kanfer Shipping managing partner Stig Hagen said “We
strongly believe in green and blue ammonia as a future fuel and for Australia to become a leading producer. We are proud to
be part of the zero-emissions marine transportation initiative and supply bunker vessels ready-made for future marine fuels,”
Kongsberg Maritime senior vice president engines Kjell Harloff said the company’s LNG technology “already gives a net 18%
greenhouse gas reduction (including methane slip), and it can be converted to ammonia when the technology and infrastructure
are ready.” LNG is seen as a transition fuel on the road to potential zero-emissions fuels and the partnership is also eyeing a
move towards green ammonia and methanol as the targeted fuel for bunkering vessels operating in the northwest and eastern
ports of Australia. The regions have among the highest levels of heavy tonnage marine traffic in the world, making them
potential candidates for adopting zero-emissions fuels. source : www.rivieramm.com

DEMAND FOR LNG SUPPORTS CONTINUED FIRM PRICES AS EUROPEAN

AND ASIAN BUYERS ARE OFFERED FEWER CARGOES
Liquefied natural gas cargo liftings are decreasing this week while North Asian spot cargo prices and benchmark European
values were still strong after the Dutch Title Transfer Facility price reached a 2021 high and North Sea Brent crude was at
levels not seen for two years. Demand for cargoes was backed by high delivery rates to China and South America, for the
Southern Hemisphere winter, and there were more customers for rising gas-fired power needs and storage in Europe. The
Japan-Korea Marker price for July spot shipments heading to North Asia were little changed at $10.924 per MMBtu compared

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with last week’s $10.925 per MMBtu, while the August JKM was slightly lower at $11.595 per MMBtu versus $11.700 per MMBtu
a week ago.The total number of LNG shipments being lifted this week declined to around 107 cargoes in the three trading
Basins. Front-month Brent crude oil settled at around $72.41 per barrel on June 18, at almost the same level as last week’s
$72.15 per barrel.However, oil prices had surged during the past week on expectations that full-scale energy demand would
return faster than is happening.The price of Brent had jumped on June 16 to $74.64 per barrel, its highest level since April
2019. At current Brent oil price levels, the long-term, crude-linked LNG price was at around $9.50 per MMBtu.
European prices
The European benchmark the Dutch TTF price hit its highest level in 2021 in the past week, rsing to the equivalent of $10.22
per MMBtu on June 14 on increased demand prospects during summer re-openings. The Dutch TTF fell back to be around
$9.90 per MMBtu, though was still higher than last week’s $9.15 per MMBtu. The UK National Balancing Point natural gas
price declined on the week to $9.65 per MMBtu versus $9.95 per MMBtu last week. Demand for cargoes in India was steady
as industrial activity recovered. In the spot delivered ex-ship (DES) LNG cargoes market for areas such as India and the
Middle East region, the West India Marker (WIM) fell back to $11.062 for August compared with last week’s $11.335 per MMBtu.
The September West India Marker price was quoted at $10.980 per MMBtu. These India-Gulf prices cover LNG spot physical
shipments delivered ex-ship (DES) into ports such as those in India and in Kuwait and are for cargoes in the range of 135,000-
175,000 cubic metres capacity.
US data
The US exported 18 LNG cargoes in the past week compared with 17 shipments in the previous week, with a combined LNG-
carrying capacity of 65 billion cubic feet, according to the US Energy Information Administration. Four cargoes were lifted from
each of three plants, Sabine Pass in Louisiana and the Freeport and Corpus Christi facilities in Texas. The Cameron plant in
Louisiana and Cove Point in Maryland dispatched three shipments each. “Natural gas deliveries to US LNG export facilities
averaged 9.4 billion cubic feet per day, or 0.80 Bcf per day higher than last week,” added the EIA. At the same time, pipeline
natural gas exports to Mexico increased 4.6 percent to 6.8 Bcf per day, a new weekly average record. US Gulf Coast LNG
futures prices showed some decline, though buyers were still seeking volumes from Louisiana and Texas as fewer shipments
were now departing in June than in previous months. The July US GCL free-on-board (FOB) cargo quote was $8.350 per
MMBtu versus $8.364 a week ago. The August GCL FOB was offered at $8.358 per MMBtu versus last week’s $8.445 per
MMBtu. The US Henry Hub benchmark spot natural gas price rose to $3.19 per MMBtu versus $3.09 per MMBtu on June 11.
The New York Mercantile Exchange front-month natural gas futures price was lower at $3.210 per MMBtu from $3.240 per
MMBtu. On the US storage front, net injections into storage totaled 16 Bcf for the week compared with the five-year (2016-
2020) average net injections of 87 Bcf and last year's net injections of 86 Bcf during the same week. “Working natural gas
stocks totaled 2,427 Bcf, which is 126 Bcf lower than the five-year average and 453 Bcf lower than last year at this time,”
said the EIA. The dollar, the base currency in energy, rose against the euro. In April 2020, for example, one US dollar bought
you €0.933 cents in Europe. The dollar was able to be exchanged for €0.831 on June 18 compared with €0.821 last week.

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Shipping
In the LNG shipping market, data showed that there would be at least 107 cargo liftings in the week through Sunday June 20
from producing nations in the Pacific Basin, the Atlantic Basin and the Arab Gulf region. This is lower than the previous week's
120 liftings. The Pacific Basin will account for around 39 shipments in the week through June 20, including 23 from Australia,
around six from Malaysia and five from Indonesia, two from Papua New Guinea and one from Brunei. The Basin’s Pampa
Melchorita facility on the Pacific Coast of Peru shipped no cargoes. A further three cargoes were being lifted from Gazprom’s
Sakhalin Island plant in the Russian Far East, even as maintenance has started through to July.In the Atlantic Basin there
were scheduled to be about 40 liftings, including 20 departures from the US in the week through June 20.Four shipments
were departing from Nigeria, four from Algeria, two from Angola, two from Trinidad and seven from the Russian Arctic Yamal
plant.A further 28 cargoes were scheduled to depart from the Arab Gulf region in the week through June 20, mostly from
Qatar but also including three headed for Asia from Oman and one from Abu Dhabi’s Das Island plant in the United Arab
Emirates. Shipping charter rates for LNG carriers in the spot market rose again in the past week by around $10,000 per day
in the West of Suez market to between $74,000 per day and $68,000 per day for vessels of 155,000-165,000 cubic metres
capacity.For vessels East of Suez spot charter levels were up $6,000 per day to between $60,000 per day and $56,000
per day, according to London brokers. One-year charter rates for the most modern vessels also edged higher to around
$79,000 per day.
UK gas flows
Natural gas pipeline supply to the UK market plunged on the morning of June 18. Data from National Grid showed that
instantaneous pipeline flows from the North Sea fell to 132.31 million cubic metres of supply compared with 144.52 mcm of
flows in the same period last week. The UK’s domestic and industrial gas demand also dropped to 131.45 compared with last
week’s 147.16 mcm as a heat wave ended. Supply flows on June 18 at gas grid connections near the UK’s two LNG terminals
at Milford Haven in Wales, South Hook LNG and Dragon LNG, jumped to 43.94 (24.52 mcm June 11). However, pipeline
flows near the Isle of Grain LNG terminal on the shore of the Thames-Medway estuary, southeast of London, were minimal
at 3.16 mcm (22.95 mcm). North Sea pipeline gas supply increased to the St Fergus terminal in northern Scotland, hitting
32.54 mcm (21.70 mcm). Flows were also relatively higher at 11.52 mcm (4.92 mcm) to one of two terminals at Bacton in
Norfolk on the East Coast of England, with the other facility closed. The Easington terminal on the Yorkshire coast saw flows
drop to 25.57 mcm (40.51 mcm) while flows to the Teesside terminal declined to 11.13 mcm (19.74 mcm). A National Grid
weekly data snapshot also showed that on June 16 natural gas provided the main proportion of the UK’s energy mix for power
generation, amounting to 34.6 percent of the total. Other UK power sources on that date comprised nuclear 20.2 percent,
wind 16.1 percent, imports 10.8 percent, solar 9.0 percent, biomass (wood) 8.5 percent, hydro 0.8 percent and coal 0.0
percent.

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Norwegian gas for EU
Pipeline natural gas flows from Norway on the morning of June 18 to the European Union increased for Germany and France,
though were slightly lower for Belgium. Flows to the German terminal at Emden rose to 83.4 mcm compared with 77.8 mcm
at the same time last week and flows through Germany’s Dornum terminal jumped to 52.8 mcm versus last week’s 36.9 mcm.
The Zeebrugge (Belgium) flows were slightly lower at 42.2 mcm (43.1 mcm) while flows to Dunkirk (France) were at 45.5
mcm after being interrupted by a technical issue at the same time last week. The Norwegian aggregated (including UK) exit
flows on June 18 jumped to 270 mcm from the 243.3 mcm of flows recorded a week ago. source : www.lngjournal.com

ARCTIC LNG PROJECT SCHEDULE TO BENEFIT FROM NEW AIRPORT

COMPLETED NEAR WORK SITES ON GYDAN PENINSULA
The Arctic LNG export project under construction on the Gydan Peninsula in northern Siberia will benefit from a new airport
that as just come into service to speed-up the transportation of material and engineering personnel to the work sites.The flights
will operate from the city of Tyumen in Siberia to the new Utrenneye airport built specifically for Arctic LNG in the Yamal-
Nenets Autonomous Region and where the first flight landed on June 17. The Utrenniy Airport has a 1,550 metres-long runway
built for year-round transportation of rotational personnel to the Utrenneye natural gas field and the LNG project and is designed
to receive medium-sized aircraft. All three liquefaction Trains at the LNG plant are scheduled to come on stream in a two-
year time span from 2023. The launch of the first Train is planned for 2023, the second in 2024 and the third Train in 2025.
The airline service will replace helicopters previously used for ferrying services to the Gydan Peninsula project, led by Russian
natural gas company Novatek. “The use of airplanes instead of helicopters will significantly reduce the air transportation
dependence on weather conditions, increase the flight safety levels as well as optimizing the schedules for mobilizing personnel
at the project,” said the Arctic LNG project company. The main engineering, procurement and construction company on the
site is TechnipEnergies, formerly part of the TechnipFMC group before the completion of this year’s spin-off. The Arctic joint
venture is constructing three LNG liquefaction Trains of 6.6 million tonnes per annum each of capacity for a total of 19.8 MTPA
as well as cumulative gas condensate production capacity of 1.6 MTPA. The project is utilizing the construction concept of
gravity-based structure (GBS) platforms to reduce overall capital cost and reduce the environmental footprint in the Arctic zone
of Russia. The Utrenneye gas field underpinning the LNG project has 2P reserves totaling 1,434 billion cubic metres of natural
gas and 90 million tons of liquids. The engineering plan is to drop the GBS platforms into the Gulf of Ob and other infrastructure
will include LNG storage facilities of a combined 687,000 cubic metres capacity. Novatek holds 60 percent of the Arctic LNG
II project and four other 10 percent stakes are shared between various shareholder, including TotalEnergies of France. The
others are the Chinese energy majors, China National Petroleum Corp. and China National Offshore Oil Corp., as well as a
Japanese shareholding split between trading house Mitsui & Co and the state body, Japan Oil, Gas and Metals National Corp.
source : www.lngjournal.com

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US LNG DATA SHOWS CHINA STARTING TO OVERTAKE MEXICO IN TOTAL
CARGOES AS SMALLER NATIONS ALSO SUPPLIED
The US Department of Energy has just published its latest liquefied natural gas export data with the average overall price for
the six plants declining to under $6.00 per million British thermal units and as China started to overtake Mexico in overall
deliveries while more supplies reached South America and smaller nations like Malta and Lithuania. The DoE data showed 92
cargoes were delivered in April 2021 versus 96 in March 2021and 62 in April 2020. US cargo prices in April declined to an
average of $5.70 per MMBtu, down from $6.01 per MMBtu in March 2021 and with a year-to-date average of $5.70 per
MMBtu, at the export points, according to the DoE June 2021 LNG report. The Sabine Pass plant remained the volume leader
in April 2021 with its five Trains on stream and supplying 32 cargoes, followed by Freeport with 19, Corpus Christi 18, Cameron
LNG 15, Cove Point five and Elba Island three. Shipments from the Cove Point plant in Maryland cost the most for April 2021
at $6.88 per MMBtu versus $7.09 in March 2021 and for the year-to-date the shipments fetched $6.62 per MMBtu. The year-
to-date total average for all six plants was $5.85 per MMBtu. The average prices for each of the five other plants (from the
export point) from highest to lowest in April 2021 were: Freeport LNG (Texas) $6.00 per MMBtu ($6.28, March) Cameron
LNG (Louisiana) $5.86 per MMBtu ($6.25, March), Elba Island in Georgia $5.84 per MMBtu ($5.90, March), Corpus Christi
(Texas) $5.58 per MMBtu ($5.60, March) and Sabine Pass (Louisiana) $5.32 ($5.77, March). Notable cargoes shipped from
the facilities on the Gulf Coast, particularly Sabine Pass, included one to the Mediterranean island of Malta on the 138,000
cubic metres capacity “Madrid Spirit”, one to Kuwait on the 173,400 cubic metres capacity “Maran Gas Chios” and one to
Thailand on the 174,000 cubic metres capacity “Amberjack LNG”. Sempra Energy’s Cameron LNG dispatched two shipments
to Chile in South America on the 151,383 cubic metres capacity “LNG Alliance” and the 164,000 cubic metres capacity “Maran
Gas Posidonia”. Freeport LNG also supplied South America with two cargoes delivered to Argentina on the 155,000 cubic
metres capacity “British Sapphire” and 174,000 cubic metres capacity “Flex Volunteer”.The three cargoes from Elba Island
supplied Lithuania, Spain and Pakistan. The total number of cargoes dispatched since February 2016 now amounts to 2,239
shipments, or 7,317.9 billion cubic feet of natural gas. The top five countries of destination, representing 51 percent of total US
LNG exports in April 2021, were China (46.8 Bcf-13 cargoes), France (36.1 Bcf - 11), Japan (28.8 Bcf - eight), Spain (23.0
Bcf seven) and South Korea (21.7 Bcf - six cargoes). The list of the Top 10 countries of destination overall since 2016 through
April 2021 showed two Asian nations, South Korea and Japan, still leading, ahead of Mexico and with China just one behind
the Mexicans in overall cargoes. The Top 10 recipients of US LNG by numbers of cargoes at the end of April 2021 were: 1)
South Korea 317 cargoes. 2) Japan 235. 3) Mexico 160. 4) China 159. 5) Spain 143. 6) UK 126. 7) India 110. 8) Brazil 102
9. Chile 99 and 10) France 93. US LNG had been received in vessels by 39 different countries through April 2021. The US
also sends regular ISO containers by cargo ship to the Caribbean nations of Barbados, the Bahamas and Haiti. In April 2021,
a total of 23 containers were delivered, the same as in March 2021. The recipients were Bahamas 17, Barbados five and Haiti
one. source : www.lngjournal.com

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EUROPEAN DUTCH TTF NATURAL GAS AND LNG PRICE HITS 2021 RECORD
AS ICE EXTENDS FORWARD CURVE TO 2031
The popularity of the Dutch Title Transfer Facility (TTF) price for European natural gas and LNG values in the week that saw
the price hit a 2021 high of $10.22 per million British thermal units has also led the Intercontinental Exchange to extend the
forward curve for TTF futures to December 2031. ICE, the leading global provider of trading platforms and clearing, which also
recently posted record activity on the TTF and the Japan-Korea Marker for North Asian spot cargoes in the year to the start
of June, said the curve would be extended on the 21st of June 2021. The futures and options trading platform said the TTF
Gas Futures curve currently goes out to May 2029, and it currently has open interest out to December 2028.“Following
demand from customers to extend the TTF curve further out, we are extending the curve of the TTF Gas Futures contract up
to and including December 2031,” explained Gordon Bennett, Managing Director of Utility Markets at ICE. “In addition to TTF
monthly futures contracts, we will also make additional quarterly, seasonal, calendar contracts and time spreads available up
to December 2031,” stated Bennett. The length of the curve is an important component particularly for commercial hedgers
who use TTF futures to manage their risk. The extension of the futures curve aligns the TTF gas futures contract close to the
typical lengths of medium-term to long-term deals between LNG buyers and sellers. This in turn allows market participants to
manage long-term risk related to these deals through the futures market. TTF futures hit record open interest of 1.96 million
contracts on 10 June, up 20 percent year-on-year. Open interest in JKM futures and options, which work closely with the TTF
to offer the market the means to hedge global gas price risk, is at 111,800, up 9 percent year-on-year. “Natural gas has
become a global market and the record levels of open interest and strong trading activity in TTF reflect how it is at the forefront
of global natural gas price formation,” said Bennett. “The requests from customers to increase the forward curve for TTF futures
to 2031 has been driven by their need to be able to hedge global gas price risk and further optimize their LNG portfolios,”
added Bennett. source : www.lngjournal.com

SOVCOMFLOT HOLDS KEEL-LAYING CEREMONY IN FAR EAST SHIPYARD

FOR FIRST OF 15 LNG CARRIERS FOR ARCTIC PROJECT
Sovcomflot said a keel-laying ceremony was held at the Zvezda Shipbuilding yard in Russia’s Far East for a new Arctic
liquefied natural gas vessel ordered by the Russian tanker and LNG carrier fleet owner. This is the lead vessel in a series of
15 carriers, ordered from Zvezda, for servicing the Arctic LNG II project being constructed for a consortium including Novatek,
Europe’s TotalEnergies and Chinese and Japanese companies. “She is the first-ever vessel of such dimensions, cargo capacity
and ice-breaking capabilities to be constructed at a Russian shipyard,” said Sovcomflot. This lead vessel of the series is owned
by Sovcomflot, while the remaining 14 ships are owned by Smart LNG, a joint venture between Sovcomflot and Novatek. “All
vessels in the series will operate under long-term time-charter contracts with Arctic LNG II,” explained Sovcomflot. “Their
construction is being financed by Russian bank VEB.RF and 15 carriers will operate under the Russian flag,” added the fleet
owner. The shipbuilding process at the yard in Bolshoi Kamen on the coast of the Sea of Japan, about 12 miles northeast of
Vladivostok, is being supervised by the Russian Maritime Register of Shipping and French class society Bureau Veritas. All 15

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vessels are scheduled for delivery in 2023-2025. The keel for the lead vessel has been laid in line with the contractual
schedule. “This series of ice-class Arc7 vessels is designed for the year-round transportation of LNG in the challenging
conditions along the Northern Sea Route, including its eastern sector,” said Sovcomflot. Each LNG carrier will be 300 metres
long, 48.8 metres wide and will have a cargo capacity of 172,600 cubic metres. The propulsion system includes three azimuth
propulsion units and with a total power capacity of 45 megawatts. Sovcomflot currently has 20 large-capacity tankers ordered
from Zvezda, with a total deadweight of 1.86 million tonnes and a total cost of over $5 billion. These include 15 ice-breaking
LNG carriers and five LNG-fuelled tankers of various sizes, for transporting crude oil and petroleum products.source : www.lngjournal.com

JAPANESE CLASS SOCIETY APPROVES PROJECT RUN BY TSUNEISHI

SHIPBUILDING FOR LNG-POWERED BULKER DESIGN
Nippon Kaiji Kyokai, the Japanese maritime classification society, has approved a project run by Tsuneishi Shipbuilding for
their concept design of an LNG-powered bulk carrier. Nippon Kaiji Kyokai, known as ClassNK, granted an Approval in Principle
based on its Rule Part GF regulation for ships using low-flashpoint fuels and incorporating the international code for the
“Kamsarmax GF” series of vessels. The GF in “Kamsarmax GF” stands for Gas Fuel and the vessel has an installed dual-fuel
engine using LNG as the main fuel and an IMO Type C Fuel tank. The main features of the system being incorporated by the
Tsuneishi shipyard into the Kamsarmax is aimed at having a high environmental performance. Designed to use LNG as its
primary fuel, it has achieved a reduction of carbon-dioxide emissions by 40 percent or more compared with traditional fuels.
In addition, the emissions of sulfur oxides (SOx) and nitrogen oxides (NOx) have also been greatly reduced. “As more
environmental technologies have been developed to realize a low-carbon and decarbonized society in the maritime industry,
developments of LNG-fueled ships are progressed in a variety of ship types and sizes,” explained ClassNK. The class society
earlier in 2021 issued its latest survey guidelines for facilities and equipment on LNG bunkering vessels supplying fuel to LNG-
powered ships at sea. ClassNK noted that there were no established international conventions for the facilities or equipment
of ships that transfer LNG to other ships at sea, and additional safety equipment has been considered individually. Based on
the examinations conducted so far, ClassNK has developed guidelines complying with the requirements for additional equipment
for the safe transfer of LNG. The guidelines stipulate the layout and system design of LNG bunkering ships, fuel transfer
systems, and operation, as well as class notations according to the equipment to be installed. source : www.lngjournal.com

EUROPEAN GAS STORAGE IN A GLOBAL MARKET

Withdrawals from Europe’s gas storage facilities were continuing well into May, more than a month after the injection period
would have started in a typical year. This has raised questions about the continent’s state of readiness for next winter and the
prospect of higher prices for delivery after October. Storage facilities exist because the alternative – major pipelines capable
of carrying the customers’ peak day demand – would be uneconomic. Gas flows at a steady rate over the year and in the

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days of European gas monopolies, it was injected into storage facilities at times of low demand. In a competitive world, by
contrast, the “invisible hand” of the market is meant to take care of storage by responding to summer-winter price signals. But
this year there is no price signal: summer prices are almost the same as winter prices. There is no incentive now to inject.
There were three major reasons for the slow start on both the supply and demand side. First, it had been a very cold April,
meaning gas was needed for heating for longer. Second, other sources of power generation such as wind, hydro and French
nuclear power, were all low, making gas more necessary in the power sector too. And third, carbon prices were also high,
reaching and even exceeding €50/metric ton in early May. The continuing bull run provided a reason to burn gas instead of
coal where possible. There were another three reasons on the supply side: lower than expected deliveries from Russia;
maintenance offshore Norway, which will see less gas produced as essential maintenance work was held from last year by
COVID-19; and US LNG, which might have been expected to come to Europe, went instead to capture the higher netbacks
from Asia as it was cold there too.More predictable is the fact that the Dutch Groningen gas field is no longer allowed to
provide the swing service that it used to. This means that another source of peak gas supply is less. It is true that Gazprom
could have booked more short-term capacity through Ukraine as it did last year, at a cost; but it has chosen not to exceed
the pre-arranged volume so far this year. Had Gazprom been allowed to complete Nord Stream 2 on time, it would by now
be carrying more gas than the annual capacity deal with Ukraine allows: 55bn m³/yr compared with the 45bn m³ booked for
this year. All these factors explain the relatively small quantity of gas in store: 340 TWh as of May 8, which is where it had
been a month earlier.

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 Uniper Storage – the fourth largest operator in Europe and Germany’s largest, with facilities also in the
UK and Austria totalling 7.5bn m³ – told NGW early May that the low inventory level was all the more
remarkable since facilities in Germany had been 94% full at the start of the winter but were now down
to 30% full, at best. Uniper Storage head Doug Waters said that storage had again “proved its worth”
this winter; it met 61% of German gas demand in January, he said. Overall, storage had supplied 717
TWh last winter and it was still meeting demand in May, he said. During the particularly cold snap mid-
month, it was also enabling gas to meet peak electricity demand in the UK for example, as there was
almost no wind generation. “There is no alternative to storage for physical gas supply,” he said. The
surest alternative to storage is LNG and the market had mistakenly assumed that more LNG would arrive
than was the case: in the event, he said LNG deliveries to Europe were down about 45% year on year.
And yet now Europe faces the so-called “storage paradox,” he said. Typically, market appetite for storage
injections is reflected by the summer-winter price difference but at the moment, that has almost vanished.
There is no commercial benefit in buying gas now as the winter price is only €1/MWh higher. That
difference has to cover the shippers’ pipeline exit/entry capacity costs as well as the storage operators'
margin. In order to attract injections, the difference between summer and winter has to widen, meaning winter 2021-2022
prices could rise at the major gas hubs. “Low storage levels at the end of the heating season result in higher injection demand
from storage sites; this further tightens the market through the summer; which in turn drives up summer gas prices more
quickly than the winter contracts and hence reduces summer-winter spreads,” the company explained. Waters said someone
was going to be on the wrong side of this: storage would struggle to get above 80-90% full, he said, unless winter prices rise
– or summer prices fall. Commenting on the situation, consultancy Timera Energy said in a May 10 research note that: “curve
backwardation in commodity markets (when forward prices are discounted against prompt delivery) is often bullish. It may be
the back of the Dutch TTF forward curve that will be dragged up by higher near-term prices as 2021 progresses.” Some of
Uniper’s storage facilities straddle national borders: Etzel is on the Germany-Netherlands border and the Austrian facility
7Fields, which is technically operated by RAG but whose capacity Uniper markets, also allows traders to access the German
market. It sells capacity on either a fixed (for one-year contracts) or indexed basis, where the price varies with the summer-
winter price difference. On those contracts the volume is locked in but the price is not known until the average spread has
been calculated each year. In common with other operators, it sells capacity both as bundled units, where space comes with
injection and withdrawal; and as separate units, allowing owners to trade between themselves on the secondary markets.

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UK: Problems Ahead
Storage capacity, as a proportion of annual demand, ranges
widely across Europe. Most countries have built storage capacity
using depleted gas fields (long-range storage) or developed
them from salt caverns (short-range storage) or aquifers. But
the UK, which had been a gas exporter until almost 20 years
ago, relied on swing production from the Morecambe Bay fields
and the depleted and now unavailable Rough gas field to meet
peak demand. With the closure of Centrica’s Rough facility in
2017 for financial reasons, the UK now only has 2% of its supply
covered by storage, compared with about a quarter elsewhere
in Europe. Demand for peak gas is often synchronised in northwest Europe as the weather tends to be the same across the
region. So the UK is having to bid against others for the molecules. This makes the UK vulnerable, according to Clive Moffatt
founder of the UK Energy Security Group. He toldNGW: “Natural gas is critical in what will be a slow transition to net-zero
and whether it be to secure supplies of power or heat or a possible source of hydrogen, more UK gas storage is essential.
“We are vulnerable on physical supply and price security now and we will continue to be so because, despite the popular tide
of liberal opinion, we are going to be dependent on gas domestic boilers. Hydrogen – be it blue or green – is, as the majors
know, an economic non-starter; and heat pumps are simply too expensive and less effective in winter. And power generation
– both for baseload to compensate for the lack of coal and nuclear and for peakload to combat system imbalance caused by
more wind – will be necessary for many more years. And with our almost total reliance on imports after 2025 we need more
storage. We cannot depend on pipes and LNG to be there when needed.” The UK government and the energy regulator
Ofgem, ever since the closure of Rough, have said that the market, not taxpayers, should decide whether to take the risk of
an investment in new storage facilities. And those that have the potential for conversion, such as the all-but-depleted Saltfleetby
gas field in Lancashire, might be used for storing other gases altogether.It is a complicated argument: for some governments,
strategic stocks are a straightforward matter of controlling prices and responsibly ensuring supply; but nobody will invest in
new capacity if there is the chance of government intervention that will make the asset worthless. Turn on the taps, and the
investment loses its value. And in a theoretically single market, the actions of one operator will affect more than one country.

Refilling: an imperative
Replenishing storage is an “imperative for this year,” Giacomo Masato and Evangeline Cookson, analysts at brokerage Marex,
told NGW in an interview late April. They drew comparisons with the last time the European injection season had got off to
such a low start, which was 2018, and said injection demand had been the most important factor behind the high gas price.

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This was an unusually cold April and this has meant that the customary rebound, with injections starting at the end of March,
did not happen: in fact, facilities went from 30% full to 29% full in late April, before gaining a little afterwards. The comparison
with 2018 suggests worse is to come, because although European storage ended with less gas in store that winter, facilities
were already filling up again during April. They said: “We had gone from 18% full at the end of March to 23% full by late April.
“It was the 2018 ‘Beast from the East that led to a rapid withdrawal from European facilities at the end of the winter. The step-
change came later on, from a large wave of LNG from the US and this lowered prices during the following winter.” They
continued: “This year, stocks had been 12% higher at the end of March relative to March 2018 but now [late April] we are only
6% higher than three years ago. Prices were pulled higher during that restocking phase and rose to $27-28/MWh. “This is
potentially worrying as 2018 ended with EU stocks at 85% full as the withdrawal season was about to start. That is a tight
supply for the beginning of the forthcoming winter and the market is aware that a repeat of 2018 is possible.” The October
2020 season began with storage about 93% full. “April can deliver significant withdrawal, but injections cannot wait any longer
than the start of May, so then injections have to happen, whatever the price. That is why now the price curve is flat from now
until December in Europe: summer trading has eroded the summer-winter spread. If storage reaches only 85%-90% full by
October, that will send a bullish signal. But if it goes above 90% full, the market will happily wait to see what demand does,”
they said. There are some grounds – based on the current Asia-Europe spread from June onward – for believing that the LNG
send-out over Europe may well decline during the second half of the restocking phase. And if Russia had booked incremental
capacity through Ukraine – and it had been expected to do so, they said, judging from the brief drop in EU gas prices in late
April – then that could lower Dutch TTF prices, making storage more attractive. But at the same time it would push more LNG
into Asia, and away from Europe. The lower Europe’s prices become, the less attractive a destination it is for LNG relative to
Asia.The Asian-EU premium for prompt delivery of spot – as opposed to long-term contracted – cargoes was about $1/mn
Btu in late April. “We have noticed that when the difference between the two is well below $0.50/mn Btu then the LNG will
primarily target Europe. But at $1/mn Btu or more, Asia becomes much more competitive and can erode parts of the global
supply share away from Europe.” However, a week later the premium was down to $0.4/mn Btu, suggesting that a turnaround
in Europe’s fortunes is coming. As to the longer term, there are reasons the global market could redistribute LNG more evenly.
“US facilities are now at their highest levels of output but there have been delays across the value chain owing to the COVID-
19 pandemic, slowing down buildout. If Asian import expansion continues to grow faster than expansion from key exporters
(such as US and Qatar, among others) we will see the competition for gas between Asia and Europe maintained and naturally,
prices will rise,” they said. But there is more optionality in Asia where power generation is concerned: gas is not the only fuel
and there is no carbon market. Japan is bringing back more nuclear plants into service and coal is still widely burned. “All
forms of diversification will be taken into account there, while in Europe the soaring price of carbon works against coal and in
favour of gas,” they said. China has been upping the use of facilities that can use LNG and its expansion has been very rapid
as it moves away from coal. Even building LNG import facilities gives it mini-LNG storage, the analysts say, which in turn
fractionally eases the pressure on demand. Source : www.naturalgasworld.com

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and do not necessarily reflect the views of any other associated company. NEWS AND SOURCE: LNGWORLDNEWS, LNG INDUSTRY, NATURAL GAS WORLD, LNG JOURNAL, RIVIERAMM , THE HINDU BUSINESS, ARGUS MEDIA, PETROWATCH, REUTERS, IGU LNG REPORT,

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