India Receives Biggest LNG Shipment

 

India has received its biggest shipment of liquefied natural gas (LNG) by ship as it looks to diversify supplies and economize parcel size to meet growing energy demand.

A Q-Max LNG vessel, the largest LNG carrier in its class, with a capacity of about 261,000 cubic meters, was received at Petronet LNG Ltd's Dahej import terminal in Gujarat.

The receipt of the ship, carrying cargo from Ras-Laffan, Qatar, has set another benchmark, the company said in a statement here.

Last year, Petronet had successfully unloaded 1,000th cargo at Dahej in a short span of about 9 years.

"We are glad to receive first Q-Max LNG vessel, one of the biggest size LNG ships available today, at Dahej Terminal and expect to receive more such cargoes in future," Petronet Managing Director & CEO Ashok Kumar Balyan said.

In April, Petronet had signed a short-term contract with Qatar's Ras Laffan Liquefied Natural Gas Co to import 800,000 tons of LNG over 12 months to supply to refineries.

Petronet currently imports 7.5 million tons a year of LNG from RasGas on a long-term contract that was signed in 2004.

"The global energy supplier currently makes regular deliveries to Petronet's Dahej and Kochi terminals. After South Korea, India is RasGas' largest recipient of LNG by volume," the statement said.

RasGas will load its 1,000th cargo destined to Dahej in mid-December.

"The safe berthing and unloading of the Mekaines Q-Max vessel at Dahej is another significant milestone to highlight relationship between RasGas and Petronet.

 

Iraq, Kurds Reach Major Oil Deal

 

The Iraqi government reached a deal with the Kurdish local authorities in the country's north to exchange oil from the autonomous region for a nearly 20 percent share of the national budget, officials said.

The deal resolves a months-long impasse that had undermined national unity amid the fight against the Islamic State of Iraq and the Levant group — a battle in which Iraqi soldiers and Kurdish "peshmerga" troops have joined forces against the extremists.

The agreement stipulates that the semi-autonomous Kurdish government will release 550,000 barrels of oil every day to the Iraqi oil ministry, more than half of which will come from the disputed Kirkuk oil fields, according to Iraqi Finance Minister Hoshyar Zebari.

The Kurds took control of the Kirkuk fields to prevent them from falling to the ISIL group during its summer blitz that captured much of Iraq's north and west.

In exchange, the Kurds will receive the 17-percent share of the national budget allocated to their region, plus installments of as much as $1 billion to boost the capabilities of Kurdish "peshmerga" fighters battling the ISIL militants.

 

Bahrain Oil Output to Grow 4% Next Year

 

Bahrain's oil output is expected to grow by four per cent next year, according to an expert analysis.

However, economic growth is expected to slow to an average of 3.5 per cent over 2015-16, thanks to weaker growth in non-oil activities, says a new report by the Institute of Chartered Accountants in England and Wales (ICAEW).

The report, 'Economic Insight: Middle East' is produced by Centre for Economics and Business Research (Cebr), ICAEW's partner and economic forecaster, said the Gulf Daily News (GDN), our sister publication.

The report warns that the impact of continued oil price weakness could put considerable pressure on GCC economies and affect real GDP growth, unless they step up diversification efforts.

According to the International Monetary Fund, the projected 2015 breakeven prices, at which oil must sell in order to balance the budget, put Bahrain and Oman under the greatest pressure at $116 and $108 per barrel ,respectively.

A cut in production levels could be considered in response to falling prices, as done in the past by Saudi Arabia.

However, the spending plans suggested by the breakeven prices imply that most GCC hydrocarbon exporters do not have the flexibility to endure sustained reductions in either output or revenues.

ICAEW economic adviser and Cebr executive chairman Douglas McWilliams told the GDN that large shares of government budgets in the GCC are swallowed up by public spending.

 

Georgia's Batumi Oil Loadings Down

 

Crude oil and refined oil product shipments from Georgia's Black Sea port of Batumi were down 24.4 percent in the first 11 months of the year from a year earlier, a senior official at the terminal said.

Bad weather in Kazakhstan, where the oil is produced, lower-than-expected output from the Kashagan oilfield at the beginning of the year and re-routing part of oil shipments to Baku-Tbilisi Ceyhan pipeline contributed to the decline, said the official, who declined to be identified.

The Batumi terminal, operated by Kazakh state energy company KazMunaiGas , shipped 3.914 million tons of oil and oil products during the 11 months, down from 5.178 million tons in the same period of 2013.

Shipments in November were 423,940 tons, down from 547,158 in November 2013, but up from 266,791 in October this year.

The terminal shipped 5.63 million tons last year, up from 5.19 million in 2012.

Crude and refined oil products from Azerbaijan, Kazakhstan and Turkmenistan are shipped out of Georgia's Black Sea ports of Batumi, Supsa, Poti and the terminal in Kulevi.

Some products are shipped across the Caspian Sea in small tankers, unloaded in the Azeri port of Baku and then sent by rail to Georgian ports for export to the Mediterranean.

 

Norway Asset Transfer Concluded

 

Wintershall has completed a deal to acquire various exploration and production interests from Statoil offshore Norway.

These include 5% and 24% respectively in the producing Gjøa and Vega fields, and operatorship of the Vega field (from end-March 2015). All three fields are in the North Sea. As a result, Wintershall expects to increase its production in Norway from about 40,000 boe/d to roughly 60,000 boe/d.

In addition, the company is taking a 24% stake in the Aasta Hansteen development project, 19% of the Asterix discovery, 13.2% of the Polarled pipeline project, and interests in four exploration licenses near Aasta Hansteen. All these assets are in the Norwegian Sea, with potential combined resources of about 170 MMboe.

Wintershall has paid $1.25 billion for the package, with a further payment of up to $50 million to follow once Aasta Hansteen has been developed in accordance with the current project plan.

 

Northwest European Gasoil Market Remains Weak

 

Northwest European high sulfur gasoil prices have weakened over the last several weeks following continued imports of cargoes from the US.

The FOB delivered 0.1% sulfur Rotterdam gasoil barge cash premium closed at minus $3.50/mt to the December 0.1% ICE gasoil futures contract, its lowest in over seven weeks, according to Platts data.

Traded levels at such sharp discounts to the front-month 0.1% ICE gasoil futures are indicative of a weak market, with traders expecting continued weakness for at least the first half of the month.

Traders expect gasoil exports from the US to Europe to continue to pick up in the next few weeks amid an open arbitrage from both the US Gulf and Atlantic coasts.

High sulfur heating oil prices in the US reached a 20-month low, Platts data shows, with sources in the US saying high sulfur diesel and gasoil are marketable for most arbitrages although there remain some logistical constraints to exporting, particularly on the Colonial pipeline.