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    Sanctions loom over Russian LNG ambitions [LNG Condensed]

Summary

With the world’s largest gas reserves and growing access to Asian markets, Russia undoubtably has the capacity to play in the LNG premier league. However, project development for Russia requires both foreign capital and technology, both areas where tougher US sanctions could retard the country’s LNG ambitions to the benefit of its competitors. Tougher sanctions would not just slow increases in capacity, but development of indigenous, full LNG supply chain capabilities.

[LNG Condensed]

by: Neil Ford

Posted in:

Complimentary, LNG Condensed, Liquefied Natural Gas (LNG), Russia, United States

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Sanctions loom over Russian LNG ambitions [LNG Condensed]

The head of the Nigerian Gas Flare Commercialization Programme (NGFCP) Justice Derefaka has said that the government is offering to sell gas that would otherwise have been flared, at $0.25/'000 ft³. By 2020, Nigeria's 178 flare sites will be assigned to investors. The top 50 sites account for four-fifths of what is flared and the process has generated a lot of interest among bidders. 

NGFCP expects $3.5bn of inward investments to drive the programme and achieve its targets of ending flaring in Nigeria by 2020.

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Before the flare sites are assigned, the government will appoint international lawyers for the programme, hold a bidders' conference, issue request for proposals and open the gas flare data room to qualified applicants, evaluate investors' proposals, make the award to preferred bidders and then execute commercial agreements with them.

Over 178 flare points collectively flare about 1bn ft³/day and about two thirds are onshore.

Last year. 25mn metric tons of CO2 went into the atmosphere contributing to global warming, and 47.2 TWh of potential power generation went to waste. So far in 2019, the Nigerian gas flare tracker shows 166mn ft³ have been flared.

According to Derefaka, considering security reasons, investors should adopt scalable, containerized, skid mounted or barge type 'plug and play' technologies, virtual pipelines and compressed natural gas trucks to transport gas, as opposed to pipelines.

Following the NGFCP gas flare pricing, a market survey was done by the World Bank, through the International Finance Corporation (IFC), that a realistic pricing range for flare gas to market (FG2M) in the NGFCP, would tempt off-takers to participate in the project.

The IFC report focused equally on current market conditions and potential adverse changes in market conditions within the next five and 10 years. Citing that flare gas-to-market projects will supply gas to unaddressed markets and generate savings through the provision of lower-cost power, and substituting diesel for LNG.

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