Natural Gas Daily: January 7th, 2021
Natural gas prices at the benchmark Henry Hub in Louisiana averaged just $2.05/mn BTU in 2020, the US Energy Information Administration (EIA) said, the lowest in decades.
- Weather-related weakness as the year opened persisted as economic impacts of the Covid-19 pandemic reduced both production and consumption starting in March.
Wind-generated electricity accounted for 6.5% of Great Britain's 44 GW of power supply at time of press, as the cold spell continued. This was even less than coal's 7.8%. Combined-cycle gas turbines contributed just over half (51.9%), nuclear 13.3% and biomass 6.9%. Other sources shown on the Gridwatch website included imports from the continent. The percentages will change over the day depending on the weather conditions.
Grid last issued a wind-related warning in November.
- The problems of intermittency are expected to grow as more wind generation capacity is added to the grid in the coming years.
Terrorist activity near Total's Mozambique LNG construction site in late 2020 has forced the French company to suspend work in the province of Cabo Delgado and evacuate staff.
- It is in the government's interests to crush the uprising, which is already over three years old, as soon as possible on economic as well as humanitarian grounds: it is pinning its hopes of emerging from poverty on revenues from exports of natural gas from its vast offshore resource.
- There are two projects underway, while a third, led by US major ExxonMobil, is awaiting final investment decision.
Engineering, procurement and construction firm McDermott has been awarded a contract from Qatargas to deliver front-end engineering and design (Feed) work for Qatar Petroleum's North Field South (NFS) project, it said on January 6.
- Qatar is working on expanding its LNG production capacity by undertaking North Field East (NFE) and NFS expansion projects. First gas from the NFE expansion is expected by the end of 2025. The second phase, NFS, will further increase Qatar's LNG production capacity from 110mn mt/yr to 126mn mt/yr.
CME Group January 6 said it will launch four new Japanese electricity futures contracts and two new LNG futures contracts for trading on February 8, pending regulatory review.
- Japanese power prices have rocketed in the present spell of cold weather. Demand for LNG has pushed the JKM above $14/mn Btu.