A natural gas release was announced by Kinder Morgan shortly before 8:30 A.M. From a pipeline near Goodrich, Texas, in Polk County outside Livingston on Sunday. No fire or injuries was sustained as reported due to timely intervention of the emergency who assisted to evacuate the surroundings responders. Investigation is on-going to know the cause and quantity of the gas flared.   Gas pipeline that was launch in the late 2020 has further put pressure on the strained relationship between Azerbaijan and Russia that started in Nagorno-Karabakh. This gas pipeline has consequently squeeze Moscow's diminished gas sales to Europe and Turkey. The Azerbaijan's giant, Shah Deniz II field in the Caspian Sea has the backing of the European Commission to supply $40 billion Southern Gas Corridor. This action reduces Europe's dependence on Russian energy. Stakeholder at British Petroleum (BP) said presently, all their business operations in the region keeps going as normal and their plans remain constant. In the same vein, Russian plan to increase its pipeline capacity to Europe risk being frustrated by U.S. sanctions.   Reuters reported that Ukrtransgaz opined on Monday, that Ukraine would be exporting natural gas to the European Union out of her endowed gas which reached 28 billion cubic meters (bcm) on Sept. 29, the highest level in the last 10 years. A significant volume of gas was stored due to an unusually warm winter and the export will be made this winter if market conditions are favorable.   On Thursday of the week, OPEC opined that the fall will be as a result of a significant change in the producer output from the effect of coronavirus pandemic. Oil consumption will grow from 90.7 million bpd in 2020 to 107.2 million bpd in 2030. OPEC said, "Due to the residual effects of the COVID-19 related shutdowns and its impact on the global economy including consumer behaviour, demand will likely stay persistently below previous forecasts. Next year, the consumption of oil will jump to 97.7 million bpd, reaching 99.8 million bpd in 2022, above the amount of 2019, and rise to 102.6 million bpd by 2024.  

A spokesperson from Eni said that the talks focused on finding a new agreement to allow for the restart of the idle Damietta LNG export facility in Egypt had resumed. The man also said that the parties continued talks to try to set the basis for a potential new deal to settle all pending legal issues and to reopen the factory. The restart of Damietta, which has been idle since 2012, will provide additional export opportunities for Egypt, which currently has a surplus of gas. The previous deal signed in February fell apart in April, after certain provisions of the deal had not been met. Under the February deal, UFG's 80 per cent interest in Damietta was to be split between Eni (50 per cent) and EGAS (30 per cent), meaning that Damietta 's owners will be Eni (50 per cent), EGAS (40 per cent) and EGPC (10 per cent).     According to an EBRD announcement, the European Bank for Reconstruction and Development (EBRD) will offer a USD 250 million sovereign loan to the state-owned Alexandria Petroleum Corporation (APC). This will enable the APC to partially fund USD 647 million in water and energy quality improvements at the company's diesel refinery. The initiative will put activities at the plant in line with European standards for environmental protection and pollution reduction, the bank said. By improving the efficiency of the fuel provided by the plant, greenhouse emissions will be minimized, whilst the construction of a new wastewater treatment plant intends to minimize the risk of seawater contamination and a new energy conservation scheme will help to reduce the consumption of gasoline.   Agreement has been reached between TransAlta and Tidewater Midstream with ATCO Gas and Pipelines to sell Pioneer Pipeline for CDN $255 million. It was acquired by ATCO through an option agreement with NGTL. The agreement forces the Pioneer to be incorporated into NGTL's and ATCO's Alberta natural gas transmission systems. In order to consolidate the deal, TransAlta entered into another long-term gas transportation agreements with NGTL transportation service of 400 TJ/day by 2023.   Nigeria will terminate the Direct Selling of Crude Oil and Direct Purchasing of Petroleum Products (DSDP) program by 2023, Mele Kyari said. This is triggered by the removal of subsidy from gasoline and the implementation of a market-based pricing. However, 2019-20 crude-for-products swaps programme will be extended for six months. In an attempt to secure gasoline demand in Nigeria, NNPC entered into an agreement with 15 different refiners which include Total, Vitol, Gunvor and some others. This has generated a saving of $1 billion since its inception in 2016.   Kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328  

 

Reuters reported on Tuesday that, Azerbaijan's state-owned energy company SOCAR declared that the country's oil and gas infrastructure was safe while appreciating the army action in the midst of the military conflict in the Nagorno-Karabakh region. On Tuesday, for the third day, the worst outbreak of combat between Armenia and Azerbaijan since the 1990s raged and the civilian death toll mounted. So far, the clashes have not taken place close to the main energy properties. Analysts reported on Monday that Armenia and Azerbaijan have not been subject to military clashes on Nagorno-Karabakh territory, but that they have been unable to impede shipments to oil and gas, as the conflict escalates.
It was reported by the U.S. Energy Information Administration (EIA) on Thursday that for the week ended Sept. 25 domestic supplies of natural gas rose by 76 billion cubic feet. There was a forecast of an increase of 78 billion cubic feet on average by the analysts polled by S&P Global Platts. Nevertheless, the government said that total stocks presently stand at 3.756 trillion cubic feet, up 471 billion cubic feet from a year ago, and 405 billion cubic feet above the five-year average.     It was reported by the U.S. Energy Information Administration (EIA) on Thursday that for the week ended Sept. 25 domestic supplies of natural gas rose by 76 billion cubic feet. There was a forecast of an increase of 78 billion cubic feet on average by the analysts polled by S&P Global Platts. Nevertheless, the government said that total stocks presently stand at 3.756 trillion cubic feet, up 471 billion cubic feet from a year ago, and 405 billion cubic feet above the five-year average.        

Noble Energy has announced that shareholders of the Company approved the pending merger with Chevron and all other proposals related to the Merger at Noble Energy’s Special Meeting of Shareholders held October 2. Noble Energy anticipates providing final vote results for the Special Meeting, as certified by the independent Inspector of Election, on a Form 8-K with the U.S. Securities and Exchange Commission in a later release. Chevron and Noble Energy expect to close the Merger early in the fourth quarter of 2020. Shell and Total will export 30 shipments of natural gas from the Idku liquefaction plant in 2021, Youm7, citing Oil Ministry sources reported that each shipment will average 150k cbm, potentially bringing the total exported by the two companies to 4.5 mn cbm. Egypt’s natural gas exports more than doubled to 4.5 bn cbm in 2019 — its highest level in more than a decade. Sources also said the ministry is preparing an updated investment map and data on potential natural gas concessions to be offered to investors.   Sahara Energy Resource Limited, a member of the energy conglomerate, Sahara Group, has since 2014 ploughed over $450 million into facilitating the supply of Liquefied Petroleum Gas (LPG) to Cote d’Ivoire as the nation continues its quest for cleaner cooking fuel options. Although the 2014 population and housing census (RGPH 2014) in Cote d’Ivoire showed that 78% of households use wood and charcoal as their cooking fuel while 22% use gas, the National LPG consumption has grown from 175KT in 2013 to 380KT in 2019, following increased availability of the butane gas and deliberate policy intervention by the government. The Sahara Gas vessel is owned by West Africa Gas Limited (WAGL), a joint venture between Nigerian National Petroleum Corporation (NNPC) and energy conglomerate, Sahara Group.   Agreement for the development and commercialization of gas from the Oil Mining Lease (OML) 143 that could help reduce gas flaring in the country was signed by the National Petroleum Corporation (NNPC) and Sterling Exploration and Energy Production Company (SEEPCO). Malam Kyari, the Group Managing Director of NNPC, explained that the execution of the deal is a great milestone as well as a testament to NNPC’s commitment to facilitating the nation’s transformation into a gas-powered economy. He also opined that the deal would not only help reduce gas flaring and its environmental hazards but would also promote gas production and utilization in the domestic market.   Kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328

 

Reuters reports that Mountain Valley Pipeline is seeking federal regulatory approval to resume construction on the $5.4-$5.7 billion pipeline from West Virginia to Virginia by Sept. 25. The Company said the approval will allow it to go ahead and complete several activities related to the project before winter, according to a filing with the U.S. Federal Energy Regulatory Commission (FERC) late on Tuesday. Analysts at ClearView Energy Partners said on Wednesday they expect FERC will allow Mountain Valley to resume construction even though some environmental groups and others will oppose the return to work and the new Biological Opinion.   Reuters reports that the world's largest group of shipping insurers have decided not to insure vessels participating in the Russian-led Nord Stream 2 and TurkStream gas pipeline projects so as to avoid sanctions from the U.S. This statement was made public by an associations which is a member of the International Group of P&I Clubs, with associations such as the Shipowners' Club and the London P&I Club. The statement said in a circular on Monday that it has no plans of providing "for any activity involving or related to the Nord Stream 2 or TurkStream construction projects". It said members were "strongly urged to assess and mitigate the risks of entering into contracts on the Nord Stream 2 or TurkStream construction projects and exercise the fullest possible due diligence to avoid exposure to sanctions or enforcement actions".   China's gas demand growth is expected to cap at 4.2% in 2020, its lowest in 5 years, Reuters reports. The coronavirus is said to have slowed demand and hampered the growth of demand due to the slowing level of economic activities. Demand for natural gas slumped to 1.5% in the first half, according to the report by the oil and gas department at the National Energy Administration, forecasting total 2020 consumption of 320 billion cubic meters (bcm). Forecast suggests that China's natural gas output this year would be at 189 bcm. It is also estimated that natural gas imports in 2020 were expected at 140 bcm -- 50 bcm from pipeline gas and 90 bcm from liquefied natural gas (LNG) shipments.   Reuters reports that Austrian utility giant, OMV, plans to to sell a majority of its stake in its gas pipeline subsidiary to ist rival Verbund,. The deal is hopoed will help OMV reduce debt and finance its acquisition of a leading plastics maker. OMV had earlier in the year announced it will embark on divestments in the utility. The divestments were planned for up to $2.3 billion so as to enable it finance a multi-billion dollar deal to buy one of the world's leading polymer producers, Borealis. The planned divestment will also culminate in a debt reduction of more than 570 million euros ($666.16 million), it said.   P&GJ reports that Australian pipeline company Jemena has announced plans to expand its 500-mile (800 kilometer) Eastern Gas Pipeline from Horsley Park in Sydney to the Hunter Valley. “Jemena is looking to invest upwards of $400 million to extend the EGP north from Horsley Park into the Hunter Valley,” Tudor said. Jemena’s Managing Director, Frank Tudor, declared that the proposal will ensure the connection of the Hunter Valley to existing domestic gas fields and emerging new sources of gas including a proposed LNG import terminal at Port Kembla and another proposed import terminal at Newcastle. Nigeria LNG (NLNG) has selected Siemens Energy to provide a cryogenic boil-off gas (BOG) compression train for its Bonny Island plant. The project is located in Finima, Nigeria, the Bonny Island plant has been in operation since 1999. Siemens’ partnership with NLNG and the Bonny Island project can be traced back over two decades to when the plant was first commissioned. The order further establishes Siemens Energy’s leading role in LNG BOG compression. The company has a fleet of cryogenic BOG compressors that have accumulated more than 4.2 million hours in service.      

   

 

U.S. natural gas futures has fallen to almost 10% to a six-week low on Thursday (17th September 2020) as a bigger-than-expected storage build last week kept stockpiles on track to reach record highs by the end of October. The information came from the U.S. Energy Information Administration (EIA) which announced that “utilities injected 89 billion cubic feet (bcf) of gas into storage in the week ended Sept. 11”, Reuters report. According to Reuters, the reported injection level “is higher than the 79-bcf build analysts forecast in a Reuters poll and compares with an increase of 82 bcf during the same week last year and a five-year (2015-19) average build of 77 bcf”, P&GJ reports. Speculators have in recent weeks claimed that the net long position to the “highest in almost three years despite expectations record stockpiles would make price spikes and gas shortages unlikely this winter”, P&GJ reports.

Black Bear Transmission has recently declared it has completed the previously announced bolt-on acquisition of a portfolio of Natural Gas Transmission assets from a subsidiary of the Third Coast Midstream, J&PG. The current transaction is Black Bear’s second bolt-on acquisition. They had previously acquired the Ozark system from Enbridge in April 2020. The portfolio of NGT Assets comprise six intrastate natural gas pipelines stretching nearly 1,400 miles in Alabama, Louisiana and Mississippi. The system has total capacity of more than 800 MMcf per day and benefits from significant interconnectivity to major long-haul pipelines, providing gas supply to utilities and other key end-users. Matt Rowland, President and Chief Executive Officer of Third Coast Midstream expressed the delight of the Third Coast Midstream at completing the transaction.   The combined effect of climate policies and efforts at boost renewable energy consumption and the impact of the COVID-19 is predicted to lead to a historic shrinking of fossil fuel demand, British Petroleum(BP) says in a forecast. BP's 2020 benchmark Energy Outlook depicts the Chief Executive, Bernard Looney's, new strategy to "reinvent" the 111-year old oil and gas company by shifting renewables and power. The BP prediction only expects incomplete recovery from the current pandemic over the next few years even as restrictions are being lifted all over the world. The prediction includes there scenarios wit varying levels of assumptions of government policies aimed at meeting the 2015 Paris climate agreement to limit global warming to "well below" 2 degrees Celsius from pre-industrial levels.     The Government of Argentina is making effort for the construction of a multibillion-dollar gas pipeline from its Vaca Muerta shale gas reserves to Brazil, and is looking for ways to finance the project, a source at the Argentine embassy told Reuters. Conversations regarding the progressing on the project have been on between Argentina's new envoy in Brasilia, Daniel Scioli, Brazilian President Jair Bolsonaro and his Mines and Energy Minister Bento Albuquerque. The project, they say is at the exploration stage and government is looking to go ahead with it. The pipeline Argentina is proposing will run “1,430 kilometers (888 miles) from the Neuquen province shale gas reserves to the border with Brazil at Uruguaiana and another 600 kilometers (373 miles) from there to the city of Porto Alegre, connecting to Southern Brazil's gas distribution network.” The estimated costs are $3.7 billion for Argentina and another $1.2 billion for Brazil. Black Bear Transmission has recently declared it has completed the previously announced bolt-on acquisition of a portfolio of Natural Gas Transmission assets from a subsidiary of the Third Coast Midstream, J&PG. The current transaction is Black Bear’s second bolt-on acquisition. They had previously acquired the Ozark system from Enbridge in April 2020. The portfolio of NGT Assets comprise six intrastate natural gas pipelines stretching nearly 1,400 miles in Alabama, Louisiana and Mississippi. The system has total capacity of more than 800 MMcf per day and benefits from significant interconnectivity to major long-haul pipelines, providing gas supply to utilities and other key end-users. Matt Rowland, President and Chief Executive Officer of Third Coast Midstream expressed the delight of the Third Coast Midstream at completing the transaction.       There are currently no fewer than 78 companies bidding for the rehabilitation of critical downstream pipelines, associated depots and terminal infrastructure of the Nigerian National Petroleum Corporation (NNPC) through the Finance, Build, Operate and Transfer (BOT) model. Group Managing Director of the NNPC, Mallam Mele Kyari, stated that the exercise was in fulfilment of NNPC’s commitment to transparency and accountability as an Extractive Industries Transparency Initiative (EITI) partner company and also as directed by President Muhammadu Buhari that all its operations must be guided by integrity.  

 

PETRONAS has brought a new Virtual Pipeline System (VPS) solution to the market through its Regasification Terminal (RGT) in Pengerang, P&GJ reports. The VPS will deliver Liquefied Natural Gas (LNG) to off-grid customers with the aid of cryogenic tanks. This solution will help PETRONAS to reach industrial operators in Peninsular Malaysia that have not been connected to existing the natural gas infrastructure. The new arrangement will provide them with the option to switch to an alternative form of cleaner energy. PETRONAS is piloting the implementation of the solution by delivering its first order of LNG to its client, the Continental Tyre Alor Setar Malaysia Sdn Bhd’s earlier this month.   The Interstate Natural Gas Association of America (INGAA) is appointing a new President and Chief Executive Officer in Amy Andryszak. She will be taking over from the present president current Interim President and CEO Alex Oehler. Until her current appointment, she has worked as Principal at Ogilvy Government Relations, where she manages a portfolio of projects across sectors ranging from policy areas to energy, travel and tourism, telecommunications, and financial services. She has spent a good part of her career growing and nurturing bipartisan relationships in the US legislature and with key regulatory agencies. Experts say she will be very instrumental to advocating on behalf of INGAA and INGAA member-companies. Her key responsibility on the assumption of office is the “reauthorizing the Natural Gas Pipeline Safety Act recently passed the U.S. Senate and awaits consideration in the U.S. House of Representatives”, P&GJ reports.    

The Nigeria Government through its national oil company, the Nigerian National Petroleum Corporation (NNPC), has dismissed mounting criticism of the recently increased fuel prices. The Group Marketing Director of the NNPC while admitting the hardship the recent increase portends for the people however posits that many of those criticizing the recent increase are doing so because they are ignorant of the opportunities that the recent increase comes with. He admitted that the issue of subsidy has been such a huge matter of national discuss and that the government is no longer able to bear the burden of subsidizing petroleum products anymore. The Group Marketing Director insisted that the main beneficiaries of the subsidy has been the elites who own and use several vehicles and not the poor masses who rely on public transportation.   Total Egypt and OLA Energy Egypt recently announced they are in agreement to “jointly own, build, and operate a new petroleum products terminal in Alexandria” Energy Egypt reports. The Terminal will be set up in the Mex Petroleum Zone on a 23,000 square meter plot of land and will have an initial storage capacity of 10,000 cubic metres. The facility will facilitate supply to customers and service stations of both companies in Alexandria, as well as in the North Coast and North Delta regions. Experts say the terminal at Alexandra is a strategic in securing consistent and reliable supply for OLA Energy Egypt which will enable it to serve the company’s network of retail stations all across Alexandria, the North Coast and the North Delta. The deregulation of the downstream sector of the Nigerian Oil and gas industry is gaining support and the node of key players in the market. This support and confidence was recently been expressed by the Major Oil Marketers Association of Nigeria (MOMAN), about the expected outcomes of the N250 billion National Gas Expansion Programme (NGEP) intervention fund launched by the Federal Government of Nigeria. The fund was set up by the the Central Bank of Nigeria (CBN) and the Ministry of Petroleum Resources to help stimulate investment in the gas value chain. The Chairman of NGEP says the introduction and expansion of gas into Nigeria’s energy mix will help to reduce the impact of deregulation and attract new investments. In a related development, the Autogas and Natural Gas Vehicles (NGVs) sub-committee was also put in place to promote the adoption of autogas/NGVs as an alternative fuel in Nigeria and key into the global shift from crude oil to gas.        

 

Terrorists operating the Syria area have been blamed for the recent boom blast that cut off gas suppliers and electricity. According to the oil minister, the explosion was said to have hit pipelines that feeds three major power stations in Southern Syria cities. Such attacks have taken place in the past with no one coming out to claim responsibility for such attacks. Attacks like the recent have been a fall out of the 9-Year civil war that has led to the death of at least 400,000 people. Electricity Minister Zuhair Kharbotli says the recent attack its the sixth of such attacks on the pipeline in the city. Staff of the public infrastructure office of the city have been working to address the damages.   P&GJ reports that Baltimore Gas and Electric (BGE) has conclude that the gas explosion that killed two people and injured seven was not sue to bad pipes and equipment. The utility has said it is not limiting its investigations to only the company that operates the facility that was involved in the explosion. Enquiries are being extended to include customer-owned gas piping and appliances at the scene. BGE says investigation are ongoing, and promised that the BGE will share with the federal, state, and city authorities all findings of their investigators. As part of efforts prevent further damages, the part of the gas main in the area of the incidence including 38 gas service pipes for properties along that path Baltimore’s Labyrinth Road were suspended from the operations of the gas system after the explosion.   Reuters reports that Russia's second-biggest oil producer, Lukoil, is suspending gas exports to China from its plants in Uzbekistan due to continued weak demand. Recall that Lukoil was initially prevented from exporting gas from Russia which led it to shift interest to its gas projects in neighbouring Uzbekistan, where investments of about $10 billion have been made with the hope of making returns from exports to China. The combined effect of the low prices and low demand due to the COVID-19 liquefied natural gas (LNG) has become cheaper that pipeline supplied gas with typically fixed prices. These factors have led to a the suspension of gas exports from Uzbekistan to China and a re-direct of as much as 5 billion cubic meters of gas back to the domestic Uzbek market, Pavel Zhdanov, vice-president at Lukoil reports. Lukoil is not allowed to export the gas it produces in Russia. It sells the bulk of it to state gas company Gazprom, which exports it.     Mocoh SA., a private oil distribution, logistics and global trading company, has won a new deal to become the main supplier of petroleum products to Cameroon taking over from Sahara Energy. The contract grants the Mocoh SA. exclusive right to supply gasoline and jet fuel and other derivatives to the Cameroonian market. According to the Marine & Petroleum Nigeria- “Mocoh will supply the country with 465,000MT of petroleum products during the fourth quarter of the current year. The products to be imported are composed of 150,000MT of gasoline, 210,000MT of gas oil, 60,000MT of Jet A1, 15,000MT of fuel oil 1500 and 30,000MT of fuel oil 3500.” The successful implementation of the supplier agreement is estimated to save the country around 150 billion FCFA yearly.   Nigerian energy company Lekoil Limited want to raise around $100 million to enable it commence drilling in its Ogo oilfield, according to its chief executive officer. According to the Chief Executive, Lekan Akinyanmi, Lekoil has been able to finance much of the Ogo field preparation work with finance from its producing field, Otakikpo, and intend to commence drilling once it raises sufficient funds so to do. The company is in conversation with a number of companies to for a mix of investment types for both the asset and vendor financing which is considered the most cost-effective means of raising funds for the drilling operations. For the entire lifecycle of the Ogo project, the company expects to USD1 billion.   The LNG Train 7 Project has saved Nigeria up to US$2bn through the implementation of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act in the Engineering Procurement and Construction (EPC) contract for the Nigeria. This statement was made by the Executive Secretary of the NCDMB, Engr. Simbi Kesiye Wabote stated this at the 2020 Annual Capacity Building Workshop organised by the Board for the Judiciary. The main point of Mr. Wabote is that despite the wrongly held position of many persons about the implications of the Local Content Policy, there have been improvement in the costs of delivering on projects, and also created jobs in the oil and gas industry. The Executive Secretary reiterated that the essence of the Local Content Policy is not a Nigerianization agenda but to encourage the growth of various types of technical capacities in Nigeria as well the promotion of direct foreign investment and home grown investment.

Two natural gas pipelines connecting offshore U.S. Gulf of Mexico production platforms operated by Enbridge Inc have resumed operations, following hurricane-related shutdowns a week ago. After the disaster several energy companies have continued to resume offshore operations after completing damage assessments following Hurricane Laura. The hurricane tore through the Gulf of Mexico with wind power of up to 150 mile per hour (240 kmh) winds. Days after, oil and gas producers have put back crews to up to 228 of 310 evacuated offshore facilities, according to a report from the U.S. Interior Department. The Garden Banks pipeline, a 1 billion cubic feet per day natural gas line that connects to the Auger, Baldpate, Enchilada, and Magnolia offshore production platforms, was halted as a precaution last week.

San Mateo Midstream has announced that there have been progress on several of its pipeline construction projects as well as the Black River LNG plant in Eddy County, New Mexico which has been completed, P&GJ reports. At the moment, San Mateo Midstream is close to completing the “construction of approximately 24 miles of large diameter natural gas gathering pipelines between the Black River Processing Plant and the New Mexico and Texas state line in southeastern Eddy County, P&GJ reports”. The Black River LNG expansion is said to have the capacity to move an additional 200 million cubic feet of natural gas per day to the current inlet capacity of 260 million cubic feet of natural gas per day. The expanded Black River Processing Plant will provide leverage for San Mateo’s key customer, Matador Resources Company, and also offer processing opportunities for other producer in the Delaware Basin.

Brazil's lower legislative house plans to vote in the coming week for a law that will further liberalize the natural gas market, to encourage pipelines and private investment by putting an end to the monopoly held by state-controlled oil company Petroleo Brasileiro SA (Petrobras), Reuters report. According to the presenter of the Bill to the House, Congressman Laercio Oliveira, when in operation, prices of natural gas in Brazil could drop. Supporters and promoters of the bill estimate that the initiative could attract 60 billion reais ($11 billion) in private investments and generate 4 million jobs. Recall that Petrobras had lost the monopoly in the oil and gas sector by law twenty years ago, but in practice maintained its monopoly in the virtual natural gas industry. Specifically, the law will reduce delays in getting licencing for handling concessions and building pipelines allowing the acquisition of such license to require only one authorization. The new law will strengthen competition in the industry and change the structure of the gas sector.       A new deal between Shell and Hungary will enable Hungary buy 250 million cubic meters of liquefied natural gas for a six-year period from Royal Dutch Shell Plc. through Croatia’s LNG port in Krk, Foreign Minister Peter Szijjarto said in a Facebook post on Friday. Until the new deal, Hungary had always relied mostly on Russian for gas suppliers. The current deal will slightly halt the growing footprint of Russia’s Gazprom within the region. Hungary has been open to receiving gas suppliers from any source for years. These sources include even Western ones, as long there are open routes, insisting that that neighboring countries have not been very eager to develop the needed infrastructure.   (Marine & Petroleum) The Nigerian National Petroleum Corporation (NNPC) is providing a prepayment funding support of about $1billion to the upstream operations of its subsidiary, Nigerian Petroleum Development Company (NPDC). The NNPC reports that the crude oil prepayment has made it possible for NNPC to pay NPDC’s Tax obligations of about US$700million to the Federal Government of Nigeria. The balance of the funds is slated to go to for the funding of NPDC’s capital and operating expenditures. The said repayment financing is is backed by future oil production of NPDC. The payments has been slated for two tranches of disbursement: a 5 year dollar amortizing tranche (“Tranche 1”) and a 7 year naira amortizing tranche (“Tranche 2”). According to the company, both tranches benefit from a cash sweep with the 7-year tranche having a 1-year non-call period, according to NNPC.   (Marine & Petroleum) Nigeria’s federal Government says the Petroleum Equalization Fund (PEF) and Petroleum Products Pricing Regulatory Agency (PPPRA) will be merged as part of the envisaged reforms contained in the Petroleum Industry Bill (PIB). Timipre Sylva, Nigeria’s Minister of State for Petroleum Resources, says in a deregulated petroleum regime, market forces will henceforth determine the prices at the pump, while the government would shift its focus to regulation of the industry. The recent announcement had brought some clarifications to the lingering questions about the fate of the two agencies in the event that the new pricing mechanism that eliminates subsidies and allows prices to be driven by the market. Stakeholders in the market have suggested that total deregulation with an appropriate framework and standard consumer protection is the way to go to ensure fair practices. The emphasized the importance of ensuring that key legislations such as the Petroleum Equalization Fund Act, the Petroleum Products Pricing Regulatory Authority (PPPRA) Act and Price Control Act are all reviewed in line with the new regime.  

 

 

Reuters reports that U.S. natural gas futures has reached an eight-month high on Tuesday. This new record is based on rising liquefied natural gas (LNG) exports and the continuous fall in output and forecasts for warmer weather and higher air conditioning demand over the next two weeks than previously expected. Reuters reports that Front-month gas futures rose 7.8 cents, or 3.3%, to settle at $2.417 per million British thermal units, their highest close since Dec. 5. From the beginning of the month, U.S. LNG exports were on track to rise for the first time since the lock-down. Pipeline gas flowing to the plants climbed to a three-month high of 4.4 billion cubic feet per day (bcfd) so far this month from a 21-month low of 3.3 bcfd in July.     Reuters reports that Russia's second-biggest oil producer, Lukoil, has recently suspended gas exports to China from its projects in Uzbekistan, a company official told a conference call on Friday, due to weak demand. After Lukoil was suspended from exporting gas from Russia, has been betting on its gas projects in neighboring Uzbekistan, where it has invested as much as $10 billion in the hope of making returns from exports to China. Lukoil is barred from exporting the gas it produces in Russia. It sells the bulk of it to state gas company Gazprom, which exports it.   Reports say that very high gas supplies mean European gas wholesale prices are unlikely to rise significantly over the peak demand winter months unless the weather is abnormally harsh. European gas prices reached record lows after a glut of liquefied natural gas (LNG) was experienced in Europe owing to the coronavirus lockdowns and reduced industrial output crushed demand. The Dutch gas prices (the European benchmark) fell to an all-time low of around 2 euros ($2.4) per megawatt-hour (MWh) in May, while British gas prices hit 8 pence/therm, the lowest since futures started trading in 1997. At the moment Dutch winter gas prices are trading just above 13 euros, while spot prices are just below 10 euros.         Following the completion of work on the Georgia Elba Island LNG Plant, Kinder Morgan Inc is seeking the permission of U.S. energy regulators to put in service the 10th and final liquefaction train at its nearly $2 billion Elba Island liquefied natural gas (LNG) export plant in Georgia. By design, each train has a liquefaction capacity of about 0.3 million tonnes per annum (MTPA) of LNG or 0.04 billion cubic feet per day (bcfd) of natural gas. All 10 trains at the plant will be ready for service by the end of the summer. Elba, owned up to 51% by units of Kinder Morgan and 49% by EIG Global Energy Partners, has capacity to liquefy about 2.5 MTPA of LNG, equivalent to around 0.350 billion cubic feet per day (bcfd) of natural gas. Royal Dutch Shell Plc has entered into an operations agreement for a 20-year contract to use the facility.       The Nigerian National Petroleum Corporation (NNPC) on recently announced it would reduce importation of Liquefied Petroleum Gas (LPG) into the country when the 100 million standard cubic feet of gas capacity facility at Oredo flow station in Benin City, Edo State, is commissioned. The Oredo Integrated Gas Handling Facility (IGHF) project built by the Nigerian Petroleum Development Company (NPDC) is slated for commissioning on October 31, 2020 by President Muhammadu Buhari, according to Mele Kyari, group managing director of the NNPC. Officials of the NPDC estimate that once the plant comes into operations, importation of LPG into the country will be reduced by about 40%.     Reuters reports that Mexico’s government wants Sempra Energy to commit to building an additional export facility to help sell off excess natural gas as a bargain for granting the energy infrastructure company a historic export permit, according to three people familiar with the matter. Recall that IEnova had previously discussed with the government the possibility of installing such a plant in Topolobampo, according to two of the sources. But having to commit before getting the export permit was not part of its plan, they said.  

 

 

P&GJ reports that the U.S. Federal Energy Regulatory Commission (FERC) has approved an environmental statement for the revised construction for Enbridge’s PennEast Pipeline. Going by the plan, the 118-mile natural gas pipeline project has the capacity to move up to 1.1 Bcf/d of gas from the Marcellus Shale play to markets in Pennsylvania, New Jersey and New York. Recall that the project initially faced regulatory challenges in New Jersey leading to the blocking by the state appeals court of the company’s attempt to condemn the land through the use the pipeline project. PennEast has since appealed that decision to the U.S. Supreme Court but the has court put off hearing the decision and sought the view of the U.S. solicitor general. Phase 1 consists of 68 miles of 36-inch pipe constructed entirely within Pennsylvania and should be operational by November 2021. Phase 2 would include the rest of the route through Pennsylvania and into New Jersey with an expected completion of 2023. The FERC issued its favorable review of the proposed changes on Aug. 3." P&GJ reports   Reuters reports that an EU delegation is not comfortable with a recent U.S. State Department sanctions regarding the construction of the Nord Stream 2 gas pipeline under the Baltic Sea are a breach of international law, a report said on Friday. Following the stances of the US., a European Commission spokeswoman confirmed some informal outreach, or demarche in diplomatic language, which the EU member states were invited to join on a voluntary basis. Its not clear what becomes of the project in the coming weeks as the US. considers Russia's dominance of the Gas space a major threat to its national security.   Natural gas markets have rallied rather significantly during the trading session on Thursday, breaking above the psychologically important $2.50 level. If you recall yesterday, I had suggested that we need to see some type of pullback in order to buy the market but regardless I was not going to be a seller. Years of experience has taught me that you do not sell in an uptrend, regardless of whether or not you will “know the market is going to pull back.” This is a perfect example of that because anybody who has shorted the natural gas markets because it had “gotten ahead of itself”, have gotten their faces ripped off during the session.

 

 

Enegy Egypt reports that "Gulf Energy recently paid off USD 1.4 million in arrears SDX Energy owed to China’s North Petroleum for production at the North West Gemsa concession, which SDX and North Petroleum were operating together, Al Mal reports, citing an unnamed industry source." It was gathered that "SDX sold its 50% working interest in the concession to Gulf Energy last month for USD 1.6 million. The company’s stake was priced at USD 3 million, but the sale was priced at USD 1.6 million to account for the arrears Gulf Energy would have to pay down", Energy Egypt reports.

 

"Kom Ombo Petroleum — a JV between the Egyptian General Petroleum Company and Mediterra Energy — will begin drilling two wells at its Baraka concession, which is expected to cost USD 2.5-3 mn, Al Mal reports, citing unnamed industry sources. The Baraka concession has produced some 350 to 400 bbl / d of oil this year, the sources say." (Source: Energy Egypt)

 

After years of delay, Reuters reports that a delayed sub-sea pipeline which a privately owned Chinese gas distributor ENN Group and a provincial gas grid is ready for use. The completion paves the way for more imports into China's first major independent LNG terminal. Recall that the $848 million import facility located on Zhoushan Island in eastern China's Zhejiang province started operations in 2018 however, the actual operational take-off of the facility was hindered due to the delay in the pipeline's launch. A source desiring not to be mentioned says gas has started to flow through the newly completed pipeline. State-owned Zhejiang Energy Group said last week that the 81-kilometer (50-mile) pipeline will start from ENN's three million tonnes per annum (mtpa) Zhoushan terminal and will pass through islands, terminating at Zhenhai in Ningbo.      

Despite the impact of the corona Virus, Reuter reports that "U.S. natural gas futures on Friday jumped to their highest since December after rising by the most in a week since 2009, as LNG exports increased and forecasts called for hot weather through late August." Experts suggest that the bad days of natural gas might be well behind at the moment. More precisely, records show that demand for front-month gas futures increased by 7.3 cents, or 3.4%, to $2.238 per MMbtu, their highest close since Dec. 26, wheile the contract was up 24%, its biggest weekly gain since September 2009.

SHELL Australia has received the approval of the national oil and gas regulator to commence the development of its massive Crux field offshore Western Australia, though the company earlier flagged a delay to the development thanks to pandemic and oil price concerns. According to the Energy News Bulletin, "the development will consist of five subsea production wells tapping into the northern Browse Basin, which will then be tied back to an unmanned platform. This platform will then connect via a 165km long export pipeline to the Prelude facility where it will also be operated remotely. Shell is the operator of the Crux development with an 82% interest alongside its joint venture partners Seven Group Holdings Energy (15%) and Osaka Gas (3%)."  

Ukraine's state energy company,Naftogaz, has insisted it would consider buying natural gas from Russia until Moscow offered it competitive prices and conditions. Ukraine had suspended buying gas from Russian after diplomatics relations broke-down following Russia's annexing of the peninsula of Crimea in 2014. Ukraine now buys its gas from Europe since November 2015.   Close to six months after the coronavirus caused a slowing down of economic activities in the US., analysts say U.S. liquefied natural gas (LNG) exports are on track to rise in August. Based on data from Refinitiv and comments from analysts, the rise in exports is raising U.S. gas export prices by over 15% to a three-month high. The trend of falling prices of natural gas has been around for some time. Starting from the coming into operation of a number of gas processing facilities around the world in 2019, making high supplies available to the market alongside the warm winter that was recorded in Europe in which made sevral utilities to keep high volumes of gas storgae. Currently, natural gas "stockpiles in the United States and Europe are now expected to reach all-time highs at the end of the summer injection season." Reuters reports.      

Equitrans has announced it would commence the use of the Mountain Valley Natural Gas Pipeline (MVP) by second quarter of 2021. The US$5.4 billion project has been under construction for some years. The MVP is said to be a critical project when it comes to ensuring a "reliable, affordable, and clean-burning natural gas in the mid-Atlantic and southeastern United State" , according to Equitrans Midstream President and Chief Operating Officer Diana Charletta. The project was initially slated to be completed by the end of 2018. However, a series of legal battles dragged on causing financial loses as well as delays on the part of Equitrans .

P&GJ reports that Elwood Power/ANR Horsepower's Replacement Project that will involve the replacement, upgrade and modernization of a number of facilities stretching through its ANR Pipeline Company (ANR) natural gas transmission system. The project will enable ANR to provide up to 125,000 Dth/d of firm transportation service to an existing power plant. The pipeline will run from Appalachian basin to the Midwest and Southwest with connections to the Gulf of Mexico. Part of the work that will be done include includes compression and ancillary upgrades as well as other modifications along ANR’s existing infrastructure.The facility is expected to be put to use from the second quarter of 2022.

P&GJ announced that National Fuel Gas Company has recently concluded the process of purchasing integrated upstream and midstream assets in Pennsylvania previously belonging to SWEPI LP, a subsidiary of Royal Dutch Shell. I The acquisition involves a cash transaction of approximately $504 million, after customary purchase price adjustments. National Fuel Gas Company hopes that the new acquisition will significantly enhance its earnings per share from the fiscal year 2021. This improved position is expected to led by a "significant acquired flowing production and related gathering throughput, further unit cost reductions, and its strong hedge position." P&GJ reports