January 3, 2023

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Uniper Imports Germany’s First Full LNG Cargo

Uniper has imported Germany's first full cargo of LNG at its Wilhelmshaven terminal on the country's North Sea Coast.

The cargo's arrival from the US moves the terminal one step closer to starting commercial operations in mid-January, which will help reduce Germany's draws on gas storage to meet demand.

The Maria Energy LNG carrier arrived on Jan. 3 loaded with around 170,000 cubic meters of LNG from Venture Global's Calcasieu Pass LNG export facility in Louisiana.

The shipment — enough to meet the energy needs of some 50,000 households for a year — is part of the commissioning process at the 5 billion cubic meter per year capacity Wilhelmshaven facility.

The arrival of the Maria Energy comes less than three weeks after the Wilhelmshaven project was officially opened following the arrival of the Hoegh Esperanza floating storage and regasification unit (FSRU) on Dec. 15.

The FSRU will serve the Wilhelmshaven project for the next 10 years. It arrived laden with 165,000 cubic meters of LNG loaded at the Sagunto terminal in Spain.

The Wilhelmshaven terminal has been feeding gas into Germany's grid every day since Dec. 21 and hit its highest send-out level of about 13.7 million cubic meters on Dec. 30, according to Entsog data.

Germany has turned to LNG imports to help fill the gap created by a sharp drop in imports of gas from Russia after that country's invasion of Ukraine in February 2022.

In addition to Uniper's Wilhelmshaven project, Deutsche ReGas has also imported LNG into Germany through its terminal at the Baltic Sea port of Lubmin.

The privately-held firm confirmed on Dec. 30 that the small-scale LNG carrier Coral Furcata lifted LNG from the Seapeak Hispania, which is serving as a floating storage unit (FSU) for the Deutsche ReGas project.

Due to draft restrictions at Lubmin, small LNG carriers are required to shuttle LNG to the Neptune FSRU, which converts incoming cargoes back to gas.

Healthy Storage Levels

Wilhelmshaven is one of three FSRU-based LNG terminals that are expected to come online in Germany this month and help reduce the nation's reliance on gas storage sites to meet winter demand.

During a mid-December cold snap, most of Germany's gas demand was met through storage withdrawals, but the country's storage levels have increased since Dec. 21 as a result of mild weather and commissioning activity at Wilhelmshaven.

Germany's gas stocks stood at around 222 terawatt hours (22 billion cubic meters), or 90.6% of storage capacity as of Jan. 1, 2023 up from 87.2% on Dec. 20, according to Gas Infrastructure Europe. On Jan. 1, 2022, inventories stood at only 50% of capacity.

"Gas consumption in the week beginning Dec. 19, 2022 was 23.8% lower than the average consumption of the past four years and down by 37.4% compared with the previous week. Temperatures were 2.3°C higher than in the previous years," German networks regulator BNetzA said on Tuesday.

Germany's gas consumption is expected to remain relatively low this week as it experiences temperatures in the "normal range for the time of year," BNetzA added.

Mild and windy weather across much of Europe, coupled with lower industrial demand over the Christmas/New Year holiday period, has seen European gas prices plummet in the last two weeks to levels last seen before Russia's invasion of Ukraine.

The front-month Dutch TTF gas futures contract — a benchmark for the broader European gas market — settled around €77/MWh on Jan. 2, according to Intercontinental Exchange (ICE) data. It briefly spiked above €300/MWh in August.

For more coverage of the Ukraine crisis, visit Ukraine Crisis: Energy Impact >
Eric Thorp, London

Bulgaria Signs LNG Deal with Turkey

Bulgarian state Bulgargaz has signed a long-term LNG deal with Turkey’s Botas allowing it access to Turkey’s gas network and LNG terminals as the European state diversifies away from its previous reliance on Russian piped gas.

Under the 13-year deal, Bulgargaz will be able to use Botas’ LNG terminals to receive cargoes, which can then be transported to Bulgaria via the state firm’s pipeline network. Turkish Energy Minister Fatih Donmez said the agreement would allow Bulgaria to transport up to 1.5 billion cubic meters of gas per year, while Bulgarian counterpart Energy Minister Rossen Hristov underlined that the deal allowed Sofia “to buy gas from all global producers.”

Before Russia’s invasion of Ukraine, Bulgaria relied heavily on Russian piped gas and was forced to seek alternative supplies after Russia cut off deliveries last April over Sofia’s refusal to pay for shipments in Rubles.

Options to Diversify

Hristov said late last month that a deal was due to be completed and would allow Bulgaria to book up to 1 Bcm of capacity at a Turkish LNG terminal — enough to meet almost a third of Bulgarian consumption, which is around 3.5 Bcm/yr. Bulgaria will also have the opportunity to join talks with LNG suppliers from the US and Norway, Hristov said.

A new floating, storage and regasification unit in the Gulf of Saros, in Turkey, is due to be commissioned in January, Donmez said last month, and this is located not far from where Turkish gas infrastructure connects to southeast Bulgaria at Strandzha. Bulgaria selected Greek Mytilineos and state Depa to supply it with LNG in November from the Greek Revithoussa LNG terminal, Bulgargaz said last October.

However, greater Bulgarian access to the Turkish market will need to be carefully monitored by Sofia if it wants to avoid potentially importing Russian gas in the future.

Created with Highcharts 9.0.0(million tons)TURKEY'S LNG IMPORTSEreglisiAliagaEtkiDortyol FSRU2013201420152016201720182019202020212022024681012Source: Kpler

Turkish Hub Plans

Turkey is intensifying work on a proposed gas hub, which Russia sees as an opportunity to keep the door open for its pipeline gas in Europe despite the European Union’s plans to phase out Russian imports by 2027 in response to the Russian invasion of Ukraine.

Ankara will complete a road map for the gas hub in Thrace in the European part of western Turkey by the end of the year and plans to hold a gas conference for suppliers and buyers in January or February 2023, Donmez told the TRT Haber TV channel on Nov. 8.

Apart from Russian gas, which accounts for some 40% of Turkish imports, Ankara wants its hub to trade piped gas from Azerbaijan, Iran and potentially Iraq and Israel, as well as LNG from the Middle East, Africa and US, and its own gas that Turkey plans to start producing soon in the Black Sea.
Tom Pepper, London


In Brief

Spot LNG Prices Sink Post-Holidays

Spot LNG prices in Northeast Asia fell $9 since the last assessment on Dec. 19 to $27 per million Btu, according to Energy Intelligence assessments for deliveries four to eight weeks ahead. Spot prices in Southwest Europe dropped by $10.40 to $20.70/MMBtu.

Slower trading activity during the Christmas and New Year holiday season, combined with low buying interest despite cold winter weather across Northeast Asia, have weakened spot LNG prices. Softer European gas hub prices following mild winter temperatures and strong gas and LNG supplies also helped drive spot LNG prices lower.

In Japan, below-average temperatures were forecast for the second half of December through the first half of January, with a 40% chance of above average temperatures for the rest of January, according to the Japan Meteorological Agency. Korea’s Meteorological Agency also predicts a 40% chance of higher temperatures in January compared with previous years.

Created with Highcharts 9.0.0($/MMBtu)REGIONAL SPOT PRICESNortheast AsiaSouthwest EuropeJan '22Mar '22May '22Jul '22Sep '22Nov '22Jan '23020406080Energy Intelligence

Daniel Stemler, Madrid and Yousra Samaha, Dubai

Northeast Asian LNG Imports Sank on European Competition

Northeast Asian LNG imports hit 17.3 million tons in November, a 25% drop year on year from November 2021, according to customs data. The drop occurred in the wake of intense price competition for LNG from a supply-constrained Europe.

The Northeast Asia region is home to four of the top six LNG importers in the world — Japan, China, South Korea and Taiwan. France and Spain muscled their way into the top six this year amid the Ukraine crisis, according to Kpler data.

Japan regained its spot as the world’s No. 1 LNG importer in 2022 after losing that spot to China the previous year, Kpler data shows.

Yet China surpassed Japan in November with monthly volumes rising to 6.4 million tons, a 59% increase from October when imports were at 4 million tons, according to customs data (see table).

In Japan, LNG imports rose 9% from the previous month, averaging 5.5 million tons, a 5% drop from the same period the previous year.

Northeast Asian LNG Imports
('000 tons)Nov '22Oct '22Nov '22Y-o-Y %Chg.
China6,4244,0326,901-6.92%
Japan5,5495,0875,864-5.38
South Korea 3,7964,1313,871-1.93
Taiwan 1,5991,9141,896-15.66
Total17,36715,16423,356-25.64%

Yousra Samaha, Dubai


Data Snapshot

LNG Netbacks at Key Receiving Terminals

LNG Exporter Netbacks Between Key Receiving Ports
($/MMBtu)AlgeriaAustralia WestAustralia EastMalaysiaNigeriaNorwayOmanPeruQatarRussiaTrinidadUS GulfUS East Coast
Dahej, India23.6724.1323.6724.1223.2223.0724.6622.6124.5623.7222.8922.5722.96
Sodegaura, Japan24.1925.7325.7425.8524.0920.1325.2822.8225.1426.2523.2822.2524.30
Zeebrugge, Belgium27.4625.5825.0925.6826.8727.2826.4625.0926.3125.1327.0025.9127.11
Huelva, Spain20.0418.3017.8518.3919.4619.2319.1117.7418.9817.8819.5218.4019.53
Isle of Grain, UK19.6317.8317.3717.9219.1019.4518.8017.3618.5417.4119.2018.1519.29
Everett, US1.66-0.040.320.051.321.150.010.860.62-0.441.88----
Created with Highcharts 9.0.0($/MMBtu)QATAR TO NORTHEAST ASIANetbackNetback1. Aug15. Aug29. Aug12. Sep26. Sep10. Oct24. Oct7. Nov21. Nov5. Dec19. Dec2. Jan10203040506070Energy Intelligence

LNG Market Indicators

Spot LNG Pricing
Latest WGIDailyDaily Chg.Chg. From Latest WGI
NE Asia27.0027.00----
SW Europe20.7020.70----
Futures Pricing
($/MMBtu)Chg.LatestPreviousWeek Ago
Henry Hub, US (futures)--3.99--5.28
NBP, UK (futures)-1.7920.6222.4224.11
European Spot Pricing
Chg.LatestPreviousWeek Ago
Dutch TTF--22.20----
Zeebrugge (Belgium)--------
German NCG--19.84----
NBP (UK)--20.48----
US Markets
US Spot Prices
Sabine Pass, Louisiana--3.65--4.89
Corpus Christi, Texas------3.93
Cove Point, Maryland--2.56--6.04
Elba Island, Georgia--------
Nymex Henry Hub Futures
Near Month--3.99--5.28
Second Mth--3.64--5.12
Third Mth--3.55--4.48
Created with Highcharts 9.0.0($/MMBtu)GLOBAL GAS PRICINGUS NymexDutch TTFNE AsiaJan '22Feb '22Mar '22Apr '22May '22Jun '22Jul '22Aug '22Sep '22Oct '22Nov '22Dec '22Jan '230255075100125Energy Intelligence