Natural Gas Daily: April 27th, 2020
US Could Buy Stakes in Energy Firms: Mnuchin
The US government is open to acquiring stakes in US energy companies in order to support the oil and gas industry during the Covid-19 crisis, the Treasury Secretary Steven Mnuchin said April 24.
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The Big Picture:
- President Trump also asked Mnuchin to look into acquiring oil cheaply for later use.
Gazprom Still Overcharging for Gas: PGNiG
Russia's Gazprom has failed to comply with a ruling by the Stockholm arbitration tribunal requiring it to cut the price of gas supplies to Poland's PGNiG, the latter company said on its website on April 24.
The Big Picture:
- The court ordered Gazprom in March to amend its pricing formula under the long-running supply deal it has with PGNiG, known as the Yamal contract, tying prices to market rates in Europe rather than indexing them to oil.
BP Revises Terms of Alaskan Sale
BP is still committed to finishing the $5.6bn sale of its Alaska business to Hilcorp, having renegotiated the terms of the deal to take into account recent market volatility and the oil price rout, it said.
The Big Picture:
- Last year, BP CEO Bob Dudley said that although Alaska has been instrumental in BP's growth and success for well over half a century, the company has other opportunities that are more closely aligned with its long-term strategy and more competitive for its investment.
Deal to Restart Damietta Plant Collapses
The deal signed by Eni, the Egyptian Natural Gas Holding Company (Egas), and Spain’s Naturgy to restart the mothballed 7.6bn m³/yr Damietta LNG export plant in Egypt has collapsed, Egas said in a statement April 25.
The Big Picture:
- Damietta LNG was turned off in 2012 as its gas was needed at home. The agreement, which was signed in February this year, fell through because of the uncertainties created in the market by Covid-19 outbreak, Egas said.
Last year was the sixth consecutive year of growing LNG trade, but there are ominous clouds not just on the horizon but already well overhead, according to the International Gas Union's annual report on LNG.
The Big Picture:
- Further ahead, LNG faces problems relating to its manufacture, including methane and carbon dioxide emissions along the value chain.
- Adding to these are a newly-developed set of factors that the gas industry has to contend with.
Canadian Capex Set for 20-Year Low: Rystad
Upstream spending by Canadian oil and gas producers is poised to collapse more than 40% this year, Norwegian consulting firm Rystad Energy said in a report.
The Big Picture:
- “In percentage terms, 2020 represents the most drastic spending reduction in Canada in recent memory, and far surpasses year-over-year declines of 31% in 2015 and 33% in 2009,” the report said.
