Marubeni LNG cargo for Reliance in April

Vol 14, PW 19 (24 Mar 11) Midstream & Downstream

Shell and Total’s Hazira LNG terminal in Gujarat is likely to be buzzing with hectic activity over the next 12 months.

PETROWATCH learns Reliance could land up to 48 LNG cargoes at Hazira between April 2011 and April 2012, bought under a deal with Japanese LNG trader Marubeni. “Expect the first Reliance cargo from Marubeni to arrive at Hazira towards the beginning of April,” says an industry source.

Reliance, he adds, is believed to have signed a deal with Marubeni in February (last month) to buy 25 ‘firm’ and 23 ‘optional’ LNG cargoes over a 12 month period. This deal is believed to be generally similar to a 24-cargo agreement signed between GAIL and Marubeni last October for 500,000-tonnes of LNG over three years.

Marubeni’s LNG cargoes for GAIL are priced at a 9.85% slope of the Brent crude benchmark, plus a premium of $0.95/mmbtu for the first year, rising to $1/mmbtu in the second year and $1.10/mmbtu in the third year. Details of Marubeni’s price for Reliance are unavailable but we hear it is ‘ex-ship’ which means Marubeni is likely to source the Reliance LNG cargoes from somewhere in the Middle East to reduce its own shipping costs.

Marubeni delivered its first term LNG cargo to GAIL at Petronet-LNG’s Dahej LNG terminal on February 14. This cargo, we hear, was sourced from the ADGAS facility at Das Island near Qatar.

GAIL’s second Marubeni cargo is expected at Dahej on March 26. Separately, Petronet-LNG is believed to have landed a 135,686-cubic metre spot LNG cargo at Dahej on March 12, bought from Spain’s Gas Natural.

This cargo arrived aboard Kawasaki-built LNG tanker Celestine River and was sourced from the Nigeria LNG liquefaction facility at Bonny Island. After discharging its cargo, Celestine River left Dahej on March 13.