06-21-2012, 08:01 PM
If you were JP/Sk or any garden variety SM, would you rather have 'truly advantage gas' (per Henry) measured by quality, size, location, markets, host Gov't, tax regime, exploration upside, XOM blazing LNG trail on PNG all at $.12/M cost at the LNG plant, after condensates vs PNG LNG $7.5 and Aussie LNGs +$7.5. IOC is still by far the prettiest sweetheart out there taking applications for a marriage. If I were a Burbot, I'd be concerned about some of those Aussie projects and their investors!! The last sentence is kinda redundant to what's been posted multiple times by some that have a clue.
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THE BIG PICTURE:
The makings of an LNG bubble?
Thursday, 21 June 2012
Gomati Jagadeesan
UNDERPINNED by coal seam gas resources in Australia, shale gas in North America and prolific conventional gas discoveries in east Africa, LNG export projects seem to be getting fast and furious approvals but there are increasing concerns the sector’s fortunes may turn on a dime, especially if the demand side falters.
There is much for Australian project backers to worry about as lesser-cost overseas projects may come online sooner since Australian projects face infrastructure and logistical bottlenecks leading to delays and cost blowouts.
Australian LNG projects have become some of the costliest and industry experts are now beginning to doubt whether the country will be in a position to overtake Qatar as the largest LNG exporter by 2020.
The latest to join the LNG bandwagon and one which could potentially tilt the supply balance into Asia is east Africa, which could become the next LNG hub.
Recent natural gas discoveries made in the Rovuma Basin off Mozambique and extending into Tanzania support the probability of such a hub becoming a reality.
Norway’s Statoil was the latest to strike gas in the region, with preliminary data from its Lavani exploration well suggesting 3 trillion cubic feet of in-place gas.
It comes on top of about 6Tcf of gas from its Zafarani well, which is just 10 miles from Lavani, suggesting a broader resource base there.
But it is Mozambique that holds better prospects, with both Italy’s Eni and Houston-based Anadarko striking gas at the prolific Rovuma Basin, where total resources are estimated to be upwards of 100Tcf of which between 30Tcf and 60Tcf are economically recoverable.
Anadarko and its partners are conducting front-end engineering design on an onshore two-train facility, with the potential to expand to up to six trains, each with a 5 million tonne per annum capacity.
Already, industry observers are drawing similarities between these discoveries and the North West Shelf, which can produce about 23 billion cubic metres a year.
The discoveries are on top of Britain’s BG Group and Ophir Energy’s venture in Kenya – which has to date discovered about 6Tcf of gas – and China’s CNOOC also discovered gas in the same basin.
While the gas from CNOOC’s discovery will go nowhere but China, it is not alone in being an offtaker which also has a direct participation in projects.
India’s Bharat Petroleum and Videocon Energy both hold 10% each in 6 blocks and Anadarko’s discoveries will only add to India’s ambition to import cheaper LNG.
Already, Kogas and Mitsui are equity partners in both Mozambique and Tanzania and all of the gas will head to South Korea and Japan.
Add this to the Angolan LNG – slated to come online this year and previously poised for the US markets but now looking for a new destination – and the African LNG exports will become wildcards in the LNG supply side.
It is compared with an expectation that by 2020 the US Gulf, east and Pacific coasts will be exporting about 80MMtpa, combined with about 30MMtpa from the west coast of Canada – all of which will be chasing the Asian markets of Japan, China and India.
Add this to the existing 80MMtpa capacity from Qatar and possibly similar volumes from Australia from planned projects and there appears to be a dormant LNG bubble.
Indeed, many analysts are already forecasting a supply glut by 2017, which means Australian projects, such as Woodside’s Browse and Sunrise, may not see the light of day until the beginning of the next decade.
**********
THE BIG PICTURE:
The makings of an LNG bubble?
Thursday, 21 June 2012
Gomati Jagadeesan
UNDERPINNED by coal seam gas resources in Australia, shale gas in North America and prolific conventional gas discoveries in east Africa, LNG export projects seem to be getting fast and furious approvals but there are increasing concerns the sector’s fortunes may turn on a dime, especially if the demand side falters.
There is much for Australian project backers to worry about as lesser-cost overseas projects may come online sooner since Australian projects face infrastructure and logistical bottlenecks leading to delays and cost blowouts.
Australian LNG projects have become some of the costliest and industry experts are now beginning to doubt whether the country will be in a position to overtake Qatar as the largest LNG exporter by 2020.
The latest to join the LNG bandwagon and one which could potentially tilt the supply balance into Asia is east Africa, which could become the next LNG hub.
Recent natural gas discoveries made in the Rovuma Basin off Mozambique and extending into Tanzania support the probability of such a hub becoming a reality.
Norway’s Statoil was the latest to strike gas in the region, with preliminary data from its Lavani exploration well suggesting 3 trillion cubic feet of in-place gas.
It comes on top of about 6Tcf of gas from its Zafarani well, which is just 10 miles from Lavani, suggesting a broader resource base there.
But it is Mozambique that holds better prospects, with both Italy’s Eni and Houston-based Anadarko striking gas at the prolific Rovuma Basin, where total resources are estimated to be upwards of 100Tcf of which between 30Tcf and 60Tcf are economically recoverable.
Anadarko and its partners are conducting front-end engineering design on an onshore two-train facility, with the potential to expand to up to six trains, each with a 5 million tonne per annum capacity.
Already, industry observers are drawing similarities between these discoveries and the North West Shelf, which can produce about 23 billion cubic metres a year.
The discoveries are on top of Britain’s BG Group and Ophir Energy’s venture in Kenya – which has to date discovered about 6Tcf of gas – and China’s CNOOC also discovered gas in the same basin.
While the gas from CNOOC’s discovery will go nowhere but China, it is not alone in being an offtaker which also has a direct participation in projects.
India’s Bharat Petroleum and Videocon Energy both hold 10% each in 6 blocks and Anadarko’s discoveries will only add to India’s ambition to import cheaper LNG.
Already, Kogas and Mitsui are equity partners in both Mozambique and Tanzania and all of the gas will head to South Korea and Japan.
Add this to the Angolan LNG – slated to come online this year and previously poised for the US markets but now looking for a new destination – and the African LNG exports will become wildcards in the LNG supply side.
It is compared with an expectation that by 2020 the US Gulf, east and Pacific coasts will be exporting about 80MMtpa, combined with about 30MMtpa from the west coast of Canada – all of which will be chasing the Asian markets of Japan, China and India.
Add this to the existing 80MMtpa capacity from Qatar and possibly similar volumes from Australia from planned projects and there appears to be a dormant LNG bubble.
Indeed, many analysts are already forecasting a supply glut by 2017, which means Australian projects, such as Woodside’s Browse and Sunrise, may not see the light of day until the beginning of the next decade.
