LNG: May 31-Jun 4: Kyushu Elec buys a spot cargo for summer delivery
--DES Northeast Asia
Kyushu Electric Power have bought a spot cargo from late May onwards for delivery in July to August. As the rainy season was expected start about one month early than usual, solar power generation was lower than previously planned. Moreover, the 1,000MW Matuura coal power plant was shut down from Apr 16 due to facility problems. As a result, LNG-fired thermal power plants were running at high rates. Among city gas companies, Osaka Gas was seen to have tank space and considered spot purchase for July to August delivery. The company was likely to purchase if cargoes were available at levels below long-term prices. On the other hand, Kansai Electric Power was expected to sell additional cargoes loading July to August. Depending on the weather going forward, Kansai Electric Power was believed to have supply room. As the 826MW No.3 unit at the Mihama nuclear power plant would restart on Jul 3 and the 1,180MW No.3 unit at the Oi nuclear power plant would restart on Jul 5, Kansai Electric Power seemed to have surplus LNG.
Indian state-own Pakistan LNG (PLNG) had closed a buy tender on Wednesday for a total of four cargoes for July delivery and a total of five cargoes for August delivery. The lowest offers were Vitol's $11.6612 for Jul 12-13 delivery, BP's $10.2937 for Jul 28-29 delivery, Qatar Petroleum Trading's $10.5100 for Aug 7-8 delivery, and DXT Commodities' $10.6900 for Aug 27-28 delivery. ENI, Total, POSCO, PetroChina, and Trafigura also participated the tender.
Sources witnessed far stronger demand by Brazil's state-run Petrobras in particular. The company was seen to have already secured far more than 10 spot cargoes for June delivery already. Petrobras seemed to have bought about seven cargoes for April and May delivery. Such active buying came with a significant reduction in supply of natural gas ex-Bolivia via pipeline.