LNG spot prices head south
Indian LNG importers cannot take advantage of the prevailing low spot prices because of a lack of storage facilities.
“Tanks at Hazira and Dahej are full,” says an LNG sector source. Petronet-LNG’s Kochi terminal does offer storage but has no evacuation pipelines.
Spot prices have crashed to below the $10/mmbtu mark since January. “For March deliveries prices will hover around the $9/mmbtu mark,” we hear.
“Prices are down but there is no demand (because of the slowing economy). Where there is demand there is no infrastructure.
” A GAIL source tells us power stations and fertiliser factories have lowered offtake of long term contracted R-LNG since September. Just 11 spot, short and medium term cargoes have arrived between January 1 and February 12 compared to the 20 cargoes that arrived in the same period in 2014.
Reliance remains the number one importer, bringing in four cargoes this year followed by GAIL, Petronet-LNG and GSPC bringing in two cargoes each and Shell with one cargo.
