“Asian LNG prices are down this week despite several regional liquefaction plants facing downtime.
In Europe, hedge funds’ net-long-position on the TTF has grown while a new terminal began operation in Germany.
Asian spot liquefied natural gas (LNG) financial derivatives for November traded at $13.2 per million British thermal units (MMBtu) on 4 September, down 7.5% week-on-week, on weak demand.
The market has already factored in scheduled maintenance in export facilities Australia and Norway, although some gas-buying countries will need to replenish storage levels ahead of the northern hemisphere winter.
Asia
Australia-based export terminal Queensland Curtis LNG experienced an outage on 2 September on both trains.
Although train 2 resumed the following day, train 1 remains offline as of 5 September.
In Western Australia, the North West Shelf’s train 1 is undergoing planned maintenance from 30 August to 28 September.
Oman LNG train 1 also began maintenance on 1 September. As previously reported, supply from Ichthys LNG in Australia and Petronas’ MLNG in Malaysia remain reduced.
Major power utilities in Japan reported combined LNG storage levels of 1.83 million tonnes (Mt) for 1 September, down 11.2% week-on-week but 6.4% higher than at the end of August 2023.
However, levels are 9.4% lower than the five-year average of 2.02 Mt for the end of August from 2019-23.
Japan could import additional spot LNG for 4Q 2024 delivery, but the volume depends on the duration of its current heatwave and the intensity of the upcoming winter.
According to NOAA forecast, the probability of La Nina for this winter (November 2024-January 2025) has declined to 74% from initial forecast of 85% in April.
In western Japan, the 147-megawatt (MW) Oita gas-fired power plant unit 3, operated by Kyushu Electric and Nippon Steel, was briefly offline from 2-3 September, due to limited fuel availability.
Japanese power utility Hokuriku Electric also halted operations at its 424.7-MW Toyama Shinko gas-fired power plant unit 1 from 2-4 September due to a gas-turbine leakage from an exhaust duct.
The plant was running at reduced capacity as of 5 September.
In terms of competing fuel, a combined 2.3 gigawatts (GW) of Japanese power plants were experiencing unplanned outages as of 5 September, including Jera’s coal and biomass co-fired power plant Taketoyo unit 5 which has been offline since 31 January 2024.
Jera did not provide an expected restart date on its press release explaining the status of the plant on 3 September.
Looking ahead, South Korea’s 500-MW coal fired power plant Hadong unit 7 will be offline from 7 September to 14 December 2024, with a further 1.28 GW of gas-fired power plant capacity offline for maintenance for 5 days or longer, according to the Korea Power Exchange.
South Korea’s energy minister announced that maintenance on 2 GW worth of power plant capacity has been deferred to provide additional generation capacity.
Europe
LNG for October delivery to Northwest Europe traded at $11.4 per MMBtu on 4 September, 10% lower than a week earlier, on high storage and healthy supply from the US.
Europe’s Title Transfer Facility (TTF) also traded sideways at around $12.5 per MMBtu on 4 September, despite maintenance work on supply facilities in Norway.
This year, investment funds maintained a neutral position on the TTF until early March but their aggregate long position has been growing to reach 263 terawatt-hours (TWh) as of 23 August.
Total gas pipeline flows from Norway into Europe were down 45.6% week-on-week to around 173.2 MMcmd as of 3 September, due to downstream restriction at Gullfaks, Kollsnes and Nyhamna and planned annual maintenance at Asgard, Heidrun, Johan Sverdrup, Kaarsto, Kristin, Njord, Skarv and Troll.
This compares to 128.2 MMcmd a year ago.
Germany’s Ostsee LNG import terminal in the port of Mukran began operations on 2 September.
Planned maintenance at Germany’s Brunsbuttel LNG import terminal has been extended to early October from its originally planned date of late-September.
US
The front-month Henry Hub gas price was up 2.3% week-on-week to $2.15 per MMBtu on 4 September, with feedgas levels to LNG export projects stable at around 13 billion cubic feet per day (Bcfd) since 30 August, following a brief outage at Freeport LNG.
The US exported a total 8 million tonnes of LNG in August this year, a monthly high and some 6% up on August 2023 levels and 13% higher than in July 2024.
Weather forecasts in the Mountain and Pacific regions point to above-historical average temperatures through 19 September.
