[Peter2004]

2010 summer nat gas prices are nearly a full dollar lower in the UK than the US.
Guess where the LNG tankers are scheduling to offload this year??

[ben2008]

LNG supply to the U.S. has recently jumped from just .75bcf/day to over 2bcf/day.
as long as prices remain above $5/btu here in the U.S. we should see 2+bcf/day in lng this year.

LNG Daily Flows, bcf/day

Monday
11-Jan-10
3.01

Tuesday
12-Jan-10
2.37

Wednesday
13-Jan-10
2.37

Thursday
14-Jan-10
2.13

Friday
15-Jan-10
1.94

Saturday
16-Jan-10
1.73

Sunday
17-Jan-10
1.75


Weekly Average 2.19 bcf/day

LNG Arbitrage – US/UK
Last Week $0.04/mcf – US gas price higher than UK.
Month Ago $0.54/mcf – US gas price higher than UK.
Year-Ago ($3.58)/mcf – UK gas price higher than US.

European storage now 76% full vs. year-ago of 64% full.

[ben2008]

LNG Daily Flows, bcf/day

Monday
25-Jan-10
1.73

Tuesday
26-Jan-10
1.83

Wednesday
27-Jan-10
1.83

Thursday
28-Jan-10
1.98

Friday
29-Jan-10
2.42

Saturday
30-Jan-10
2.63

Sunday
31-Jan-10
2.64



Weekly Average 2.15 bcf/day





January ~2.3bcf/d vs. year ago of ~1.1bcf/d

Q4’09 ~1.3bcf/d vs. year ago of ~0.9bcf/d

Q3’09 ~1.0bcf/d vs. year ago of ~0.9bcf/d

Q2’09 ~1.3bcf/d vs. year ago of ~0.9bcf/d

Q1'09 ~1.0bcf/d vs. year ago of ~0.8bcf/d

2008 ~0.9bcf/d

2007 ~2.1bcf/d

2006 ~1.6bcf/d



LNG Arbitrage – US/UK

Last Week ($0.98)/mcf – UK gas price higher than US.

Month Ago $0.31/mcf – US gas price higher than UK.

Year-Ago ($4.20)/mcf – UK gas price higher than US.



European storage now 67% full vs. year-ago of 54% full.

[jc]

LNG Shipping Fleet: World Fleet of LNG Carriers

[lknaik]

NG consumption in the Mid-East limits LNG exports.
Oman unlikely to have additional LNG sales for years

by Simon Webb

STRONG DEMAND: Oman LNG said that it is unlikely to have additional cargoes of LNG for years due to strong local demand. (Getty Images)
STRONG DEMAND: Oman LNG said that it is unlikely to have additional cargoes of LNG for years due to strong local demand. (Getty Images)

Strong local demand for gas means Oman LNG is unlikely to have additional cargoes of liquefied natural gas for sale for years, the company's chief executive said on Monday.

Oman lacks the gas needed to meet both rapidly rising domestic demand and to fill the LNG facility, which therefore produces below capacity, Oman LNG's chief executive Brian Buckley told reporters on the sidelines of an energy event.

Oman produces only the eight million tonnes per year (tpy) it needs to meet long term supply contracts, he said, three million tonnes below its capacity to ship gas chilled to liquid form for export on specially designed tankers.
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With Oman prioritising meeting domestic demand from power plants, industry and the oil industry, there would be no cargoes available for trade in the physical, or spot market, for some time, he said.

Buckley said: "For the next two to five years, spot trade volumes won't be available."

He added: "Up to about a year or two ago, we had some volumes for diverting and trading."

Oman itself imports through a pipeline via the UAE from Qatar. Despite this and rising domestic demand from power plants and a growing economy, Oman would meet its long term contractual commitments to export gas in the form of LNG, he said.

Buckley said: "The government is very firm on that, they will meet contractual commitments. It's a reputational issue for them, they will meet their contracts whatever."

Current contracts would expire in 2024-2025, he said.
Oman LNG sent a cargo of LNG to Kuwait last year, he said.

Kuwait imported 11 cargoes of LNG last year after opening a new import facility. The country struggles to meet peak demand for gas for power generation when temperatures soar in the summer and residents crank up air conditioning units.

Domestic demand for gas throughout the Gulf region is growing at around 10 percent per year, Buckley said. The government needed the gas to supply the industries it wants to expand to create employment for a growing population, he said.

Gas was also needed for reinjection in oil wells to maintain pressure and output on Oman's fields, he added.
Oman produces LNG from three trains, or production facilities.

Oman LNG is 51 percent owned by the government. Royal Dutch Shell owns 30 percent, while France's Total and Japan's Mitsui also have stakes. (Reuters)

[billythekidcal]

That's very interesting Ben. Where source do you use for that data?

Also, are your arb spreads based on March forward contract prices?

I wonder what sort of timeframes LNG shippers base their destination point decision on (ie. how far out do they look before they presumably lock in prices and set sail). A couple of months?

[DayTrader]

Found this scouring the web. Granted its from 2007, but it provides a detailed look at the specific demands affecting Omani natural gas.

The Muscatis: Where did the gas go?

And here is the current EIA take on the Oman production/consumption:

http://www.eia.doe.gov/emeu/cabs/Oman/NaturalGas.html

[A320]

QATAR - Gas Quality, Costs & NGL Supplies

North Field gas is very sour but rich in methane. Its ethane ethane (ĕth`ān), CH3CH3, gaseous hydrocarbon. It is a continuous-chain alkane. As a constituent of natural gas, it is used for fuel. It can be prepared by cracking and fractional distillation of petroleum. content is 5%, compared with 10.5% in the case of associated gas, and the condensate portion is quite heavy. This means the North Field can be a major source for methanol, as well as LNG LNG (liquefied natural gas): see under natural gas. (liquid methane), and a poor source of feedstocks for ethanol, ethylene, etc. Its propane and butane contents are low, compared to the yields of associated gas. The net well-head production cost of North Field gas is likely to exceed 30 US cents/m BTU Btu: see British thermal unit. . The plant site unit cost (after piping for LNG), would come to about 40 cents/m BTU. This figure compares favourably with unit costs of Pacific or Australian (N-W Shelf) gas for Japan-bound LNG. The price of gas for Qatargas' and Rasgas' LNG plants is 50 cents/m BTU.

North Field production costs in the next decade might be higher taking into account such factors as increasing wages, equipment prices, inflation, etc. The same would be true in the case of Qatar's oil production and EOR costs. Qatari planners are pinning their hopes on environmental factors which could raise the market value of natural gas.

QGPC QGPC Qatar General Petroleum Corporation
QGPC Qatar General Petroleum Company processes all its associated gas at its three NGL NGL - A dialect of IGL. plants in Umm Said, which produce propane, butane and condensate for export, as well as feedstock for industries and fuel for seawater desalination desalination
or desalting

Removal of dissolved salts from seawater and from the salty waters of inland seas, highly mineralized groundwaters, and municipal wastewaters.
..... Click the link for more information. plants and power stations. The three plants have the capacity to produce a total of 4.6m t/y of butane, propane, natural gasoline, naphtha naphtha (năp`thə, năf`–), term usually restricted to a class of colorless, volatile, flammable liquid hydrocarbon mixtures. , condensate and ethane-rich gas.

Associated gas has been extracted from the Dukhan region since oil production began in 1949, but it was originally used solely in field operations. It began to be utilised for power generation when the first gasline across the country was completed in 1962 enabling 25 MCF/day of gas to be carried from Dukhan to Doha. Non-associated gas is also utilised by local industry and desalination and power plants. The development of production facilities for the non-associated gas of the Khuff reservoir in Dukhan dates back to 1980-1981, when two gas plants with a combined production capacity of 150 MCF/day were installed.

Onshore associated gas produced with crude oil is separated at the degassing stations in the Dukhan field. The gas is collected from the separators and, after compression at field stations, flows to a stripping plant at Fahaheel. After the heavy ends are liquefied and removed, lean gas is routed to the domestic gas distribution system.

Offshore associated gas is separated from crude oil at three gas/oil separator plants at the ISND ISND Information Security News Desk (blog) , Maydan Mahzam, and Bul Hanine fields. The gas is compressed at each of the platforms. Mixed liquids are brought ashore through an 85 km underwater pipeline and carried to an NGL plant at Umm Said.

[A320]

The article above says:
"The net well-head production cost of North Field gas is likely to exceed 30 US cents/m BTU Btu: see British thermal unit.
..... Click the link for more information.. The plant site unit cost (after piping for LNG), would come to about 40 cents/m BTU.
The price of gas for Qatargas' and Rasgas' LNG plants is 50 cents/m BTU. "

Does this mean that the total cost of production and liquification into LNG is only 50 cents? Anyone know how much it costs to transport and regas to the US?

[royh]

Once shale gas goes global, LNG will become extinct.