Shell imports 10th spot LNG cargo to Hazira

Vol 10, PW 16 (30 Nov 06) News in Brief
     

Shell and Total have received their 10th spot cargo of LNG at the Hazira terminal.

LNG carrier Fuwairit belonging to RasGas-II and carrying 131,800 cubic metres of LNG from Qatar docked at Hazira on (Tuesday) 27th November. Nothing unusual, as imports at Hazira are routine today.

What was unusual were the preliminary reports that Shell bought the cargo at the unbelievably low price of $6.90 per mmbtu CIF. But a little probing revealed more.

Gujarat market sources tell us Shell did indeed pay $6.90 CIF but that this price is compensation from Qatar for the high price of approximately $11 per mmbtu CIF Shell paid for two earlier spot cargoes. Shell complained to Qatar that it was hit with big losses due to the high price of the two previous cargoes, says a source.

Qatar apparently agreed to compensate Shell with a lower price for the present cargo. Average out the price of the three cargoes and the cost of this cargo is more like $9.63 per mmbtu.

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