Natural Gas Daily: May 4th, 2020
US utility Sempra Energy has sidestepped the sea of red ink washing around its peers, reporting a Q1 2020 profit of $760mn, up from $441mn in 2019. On an adjusted basis, the company's first-quarter 2020 earnings were $932mn, up from $534mn year on year.
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The Big Picture:
- With the sales of its Latin American businesses, the company has some leeway.
- Cameron LNG has reached the final commissioning stage for the third and last train of Phase 1 of the liquefaction-export project in Hackberry, Louisiana, enabling commercial operations to begin in Q3.
First Gas from India's R-Cluster Field by June: Reliance
Reliance Industries (RIL) and its partner BP are expected to produce first gas from the R-Cluster field in the offshore KG basin by June 2020, RIL said in an investor presentation on May 1. The first gas was expected in May but has been delayed due to the ongoing lockdown in India.
The Big Picture:
- In 2017, RIL and BP announced they will invest an additional $6bn in the KG-D6 block off the east coast of India over the next three to five years to develop three projects - R-Cluster, Satellite Cluster and MJ development projects.
Saipem Lands Offshore Pipe Contract
Italian engineering firm Saipem has won a €280 ($343)mn contract to transport and install a natural gas pipeline between Denmark and Poland in the Baltic Sea for Polish transmission system operator Gaz-System, it said. The work is to start immediately.
The Big Picture:
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The 900-km Baltic Pipe is due to start pumping up to 10bn m³/yr of gas from Norwegian gas fields to Poland via Denmark starting in October 2022, with Europipe contracted to supply the tubes.
Loss Widens at Israel's Delek in Q4
Israel's largest energy firm Delek Group reported a widened loss for the fourth quarter on May 3, with auditors attaching a "going concern" warning to the company.
The Big Picture:
- The company, which paid $2bn for Chevron's North Sea business last year, suffered from increased financial expenses.
Uzbekistan Unveils Power Gen Goals
Uzbekistan's energy ministry published proposals for a 10-year strategy to develop the country's power generation sector to meet its growing electricity needs.
The Big Picture:
- Uzbekistan's main fuel for power supply is gas, accounting for around two thirds of its generation mix.
US Freeport LNG Train 3 Starts Up
Freeport LNG's third liquefaction train started commercial operations May 1, the US operator said May 4. Freeport LNG operates under tolling contracts with French Total and South Korean SK E&S. The terminal had regulatory approval a few days earlier.
The Big Picture:
- The plant comes on line when the short-term gas price is low in Europe and Asia, making US LNG exports uneconomic unless the offtaker can add value, for example using the gas to generate electricity for sale in the destination market.
- Freeport LNG's liquefaction facility is the seventh largest in the world and the second largest in the US, and will process more than 2% of US gas output when at full capacity.
